Cotton Grower Acreage Survey: Growers Dialing Back Acres in 2015

From Cotton Grower Magazine – January 2015

 

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With floundering cotton prices fresh on their minds, American cotton producers say they’ll reduce cotton acreage by more than 10 percent in the 2015 growing season. According to data culled from the annual Cotton Grower Acreage Survey, U.S. cotton farmers have indicated that they’ll plant 9.718 million acres of Upland and ELS cotton combined in the coming year.

According to USDA figures, American farmers planted 11.01 million acres of cotton in 2014, a significantly larger total than what growers now indicate they’ll plant in the coming growing season. If 9.718 million total acres holds true, it will represent the smallest crop that has been planted in the United States since 2009, when Americans planted 9.15 million acres of cotton. The 2015 projection is a far cry from the high water mark set in 2011 when American producers planted 14.735 million acres of cotton.

While cotton prices remained the most significant factor in driving acreage totals, there were several other key elements that growers took into account when answering this year’s survey. Many respondents indicated that acreage projections would be even lower if not for poor commodity prices for competing crops “across the board.” Existing cotton-specific infrastructure will also play a key role in propping up acreage through the Cotton Belt.

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In much of the country, water shortages will impact cotton acreage both positively – in places like West Texas where growers switch out of water-dependent corn – and negatively – like farther west in California where landholders consider moving ground out of row crops altogether.

In keeping with recent trends, the state of Texas will lead the way in terms of acreage. Growers and Extension experts there indicated the state will plant over 5.4 million acres of cotton in 2015 – well over half of the total for the entire 17-state Cotton Belt. While the projected total is down significantly from the state’s 2014 total of 6.2 million acres, experts say there are agronomic factors keeping acreage in cotton.

“If it were not for the Sugarcane Aphid infesting sorghum acres in the South, East and Rolling Plains, I would expect a double digit drop in cotton acres in these regions,” said one survey respondent. “However, with Sugarcane Aphid being on producers’ minds, I think the cotton acres will remain within 10 percent of 2014 levels.”

As in most years, respondents to the Cotton Grower Acreage Survey indicated that water and prices will be the main driving factors in determining acreage across Texas.

In the Southeast, cotton growers indicated that they will reduce cotton acreage from their 2014 totals, although the net loss is smaller than many might have guessed. Georgia will once again lead the charge in terms of acres planted, as growers there indicated they will plant just over 1.2 million acres of cotton in 2015. This represents a slight decrease from the 1.38 million acres Georgia cotton producers planted in 2014.

“I expect a slight decrease in acres due to prices,” said one Georgia survey respondent. “On the other hand, cotton is a dryland alternative and will be planted. Also, our growers have capacity needs in place for cotton.”

As in years past, cotton will retain acres throughout Georgia due to its rotational benefits with the state’s sizable peanut crop.

North Carolina is poised to plant the third most cotton acres in 2015 behind Texas and Georgia, respectively. Growers there intend to plant 403,750 acres of cotton, according to survey respondents. On the whole, states in the Southeast will contribute 25 percent of the entire U.S. crop in 2015.

 

Acreage reductions will continue in the Mid-South region in 2015, as growers there indicate they’ll plant 1.25 million acres of cotton – down from 1.45 million acres planted in 2014. Despite a sizable drop in acreage of its own, Mississippi will lead the way in the Mid-South with just over 382,000 acres.

Industry insiders expect Louisiana’s acreage to continue to dwindle towards historic lows, with respondents indicating that only 115,000 acres will be planted to cotton in the state in 2015.

“People are talking about going heavy on beans because it appears to be the best of the worst as far as market prices are concerned,” said one Louisiana respondent. “Corn acres will take a hit as well to beans.”

Several Mid-South respondents said that overall strong yields in 2014 will help cotton hang on to a few more acres in the region in the 2015 growing season.

Meanwhile the Far West continues to account for smaller and smaller percentages of the national total. Respondents in Arizona, New Mexico and California indicated they could plant as few as 362,000 cotton acres combined in 2015 – enough to account for little more than 3 percent of the national total.

In California, nearly every respondent mentioned concerns about water availability in determining the amount of cotton acreage in the state in 2015. Weather patterns in November and early December could ultimately have a positive impact on acreage there.

“Things are looking up with some storms and snowpack these past few weeks, so there may be a little optimism that might increase plantings from 2014 levels,” said one respondent, before adding a caveat. “Water is expensive and there will continue to be competition for supplies with some crops (vegetables, specialty horticultural crops, trees and vines) that may have better profit potential.”

 

Driving Force

As with every year, the impact of the price of cotton on final acreage cannot be overstated. During the time period the Cotton Grower Acreage Survey was conducted, prices hovered near the low 60-cent range. For many growers, this price scenario would pose serious questions about the amount of cotton acreage he or she would need to plant to remain profitable.

It should be noted here that in 2014, this survey projected a total of 10.1 million cotton acres in the United States – a full 10 percent fewer than what was eventually planted. That uptick in acreage was due to a corresponding upswing in cotton prices between December and planting season of 2014.

Prior to this year, the last time the December contract on the ICE Futures U.S. exchange had dipped into the mid-60s was October of 2009. In the following winter months, however, prices rallied enough to support 10.974 million cotton acres in the U.S. in 2010 – a sizeable increase over the 9.1 million acres that had been planted in 2009.

As always, the U.S. grower is highly knowledgeable and responsive to the fluctuations of the cotton market.

State-by-state projections from the survey can be found on the following page.

 

2015 Cotton Grower Acreage Survey

 

STATE                                               2014 FINAL                          2015 CG PROJECTED

SOUTHEAST                                     2,672,000                                          2,409,027

Alabama                                                355,000                                             317,777

Florida                                                   105,000                                               95,000

Georgia                                              1,380,000                                          1,217,500

North Carolina                                      465,000                                              403,750

South Carolina                                      280,000                                             294,000

Virginia                                                   87,000                                                81,000

 

MID-SOUTH                                     1,445,000                                           1,256,409

Arkansas                                             330,000                                              307,600

Louisiana                                             170,000                                              115,000

Mississippi                                           425,000                                              382,143

Missouri                                               250,000                                              240,833

Tennessee                                           270,000                                              210,833

 

SOUTHWEST                                    6,460,000                                          5,690,470

Kansas                                                    30,000                                               50,000

Oklahoma                                              230,000                                             212,000

Texas                                                  6,200,017                                          5,428,470

 

WEST                                                    416,000                                             362,000

Arizona                                                  155,000                                             105,000

California                                               215,000                                             215,000

New Mexico                                             46,000                                               42,000

 

TOTALS                                            11,010,000                                         9,718,000

 

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