U.S. cotton producers could reduce their plantings by nearly 7 percent in 2002, according to the annual early season planting intentions survey released by the National Cotton Council at its annual meeting.
The survey, which the council said reflected growers' thinking in mid- to late January, indicated that farmers would plant 14.7 million acres — 14.49 million of upland cotton and 247,000 acres of Pima — compared to 15.53 million total acres in 2001.
Most of the reduction would occur in the Mid-South states where producers responding to the survey said they were leaning toward reducing their plantings by 19.9 percent to 3.68 million acres when planting begins in April or early May. Mid-South growers planted 4.6 million acres last year.
“Cotton prices have fallen precipitously over the past year and would be consistent with a grower return of loan value or just slightly better for the 2002 crop,” said the Cotton Council's Kent Lanclos. “Even ultra-efficient cotton growers will have grave difficulty turning a profit with prices this low.”
Less in Far West
Growers in the West could decrease plantings 11.6 percent and in the Southeast 3.1 percent. Upland cotton acreage in the Southwest is projected to increase 1.6 percent because of higher acreage in Texas.
This was the 19th year in which the council has conducted the survey by mailing questionnaires to a high percentage of producers across the Cotton Belt in early January. In most of those years, the survey has proven to be a good indicator of eventual plantings.
This year's survey results were within the range of a group of analysts polled by the Oster Dow Jones News Service prior to its release. The 10 analysts' predictions ran from a low of 14 million to a high of 15 million acres.
But one analyst said both the council and the analysts' projections could be too optimistic if the Grassley amendment passed by the Senate makes its way into the final farm bill.
“The failure of Congress thus far to enact new farm legislation has added an additional element of uncertainty to cotton acreage for 2002,” he said. “An uncertain farm policy environment, coupled with extraordinarily low prices and already weak balance sheets, has created significant financing difficulties for some growers, contributing to the expected reduction in cotton acreage.”
The economist stressed that many growers have few, if any, viable alternatives to cotton given that prices for alternative crops also have registered significant declines over the past year.
According to the survey, with average abandonment, total upland and ELS harvested area would be about 12.87 million acres. Applying each state's average yield to its 2002 projected harvested acres generates a crop of 17.1 million bales, 16.6 million bales of upland cotton and 535,000 bales of ELS cotton.
“This compares to 2001's total production of 20.08 million bales, according to USDA's January 2002 estimate,” he noted. Cottonseed production for 2002 is projected to 6.5 million tons in 2002, down from 7.6 million tons the previous year.