US cotton sowings in 2011 are expected to hit a five-year high, propelled by a rally in prices of the fiber to 150-year peaks last year, a Reuters survey showed on Thursday. The survey of 10 industry players and analysts showed US cotton farmers would likely plant 12.48 million to 12.53 million acres of cotton, the highest since 2006's 15.274 million acres.
-- US cotton plantings seen up 13-13.5 percent
"This increase (in plantings) is all off the price," OA Cleveland, a cotton economist at Mississippi State University, told Reuters at the annual Beltwide cotton conference in Atlanta.
Cotton prices hit a record $1.5912 per lb on December 21, 2010, and the new-crop December contract on ICE Futures US touched a contract high of $1.025 on Thursday.
Analysts said US cotton sowings would be tempered by weather during spring plantings and competition from grains such as soybeans, which are trading around $13 per bushel and tempting for farmers in states from Louisiana to Georgia.
"It's all going to depend on weather and other commodity prices," said Eddie Smith, a farmer in Floydada, Texas.
Terry Barr of CoBank, which lends to agribusiness around the country, said there were many variables going into this season.
One of the most pressing would be global economic growth, especially that of top cotton consumer China, he said.
James Robinson, an economist at Texas A&M University, said a further complication going into 2011 would be drought in states such as Texas, the top US cotton-growing region.
"It is worsening the further west you go," he said.
The drought is being caused by a La Nina weather pattern that is near its peak strength, government weather scientists said.
Comments
Comments are closed for this article.