Cotton Grower Magazine Annual Acreage Survey: The Slide Continues

In keeping with projections from cotton economists and industry leaders, cotton producers from across the U.S. say they’ll be drawing back their cotton acres in 2013, according to the annual Cotton Grower acreage survey.

The survey results indicate that U.S. producers will plant 9.731 million acres of cotton in the 2013 growing season. That number represents a 21% decrease in U.S. acreage from the final USDA planted acreage number of 12.36 million acres in 2012. If Cotton Grower’s survey results prove accurate, 2013 will be the second year in a row that cotton acres have decreased in the U.S., although the 2013 drop-off in acreage will be more dramatic than the acreage decrease in 2012. Rising input costs and dwindling cotton prices were by far the most cited reasons for a reduction in cotton acreage in 2013 among survey respondents.

As expected, the Southwest region will lead the way in U.S. cotton production in 2013, with 58% of U.S. acreage projected to be planted there. Texas will once again pace the nation in cotton production. The Lone Star State’s projected 5.4 million acres of cotton would represent well over half of the nation’s cotton crop in 2013. Texas respondents cited lingering drought concerns as one of the reasons acreage is expected to decrease in the Lone Star state in 2013.

The Southeast is projected to account for roughly 23% of U.S. cotton acres in 2013. Georgia will once again have a firm grasp on the number two spot in terms of cotton acreage by state, behind only Texas. Georgia’s projected 1.127 million acres of cotton in 2013 would represent only a minor reduction from 2012, when growers in the Peach State planted 1.29 million acres of cotton. Experts in Georgia say rotational benefits with peanuts are a strong draw for cotton production.

The Mid-South could see the biggest reduction in acreage in 2013, according to survey results. Every state in the Mid-South region is projected to have a significant drawback in acreage in 2013. Mississippi’s projected 265,830 acres would be a drop of 200,000 from the 2012 growing season, and could quite possibly represent the smallest cotton crop the state has grown in history.

The Far West will once again produce the smallest percentage of any of the four regions in the Cotton Belt, with a projected total representing just 5% of the total U.S. acreage in 2013. California is expected to lead the way in the Far West, with a projected total of 255,830 acres – down from a final planted acreage total of 367,000 in 2012. If trends hold, over 65% of California’s acreage will be in Pima cotton.

Just as in past years, the Cotton Grower Acreage Survey is conducted over the course of October, November and early December and released in the January issue of Cotton Grower magazine to coincide with the Beltwide Cotton Conferences. Further acreage projections follow. The National Cotton Council releases an annual acreage projection at its Annual Meeting in February, followed by the USDA acreage estimates which are traditionally released in March.

Familiar Situation
When drawing analysis for this year’s acreage survey results, it is difficult to ignore how similar the 2009 and 2013 production seasons could shape up. As more than one industry expert pointed out, 2013 mirrors 2009 in terms of the price relationships between cotton, corn and soybeans – based on the harvest 2013 contracts. According to USDA numbers, U.S. producers planted 9.15 million acres of cotton in 2009.

One factor that is boosting cotton acreage in the coming year is a bearish peanut market, which makes cotton a more attractive option in the Southeast. Competing crop prices will take away cotton acreage in the Mid-South and Far West, however. Corn and soybean prices continue to outpace cotton by a wide margin headed into 2013. Survey respondents indicated this will be the biggest factor driving acreage down in the Mid-South region.

Sources in the Southwest indicate a burgeoning interest in sorghum, which could steal some acres from cotton on the Texas High Plains. In many spots on the High Plains, dwindling water scenarios make cotton a more attractive option than competitive crops, however.

As has been the case in recent years, Chinese consumption will play a large role in determining prices throughout the 2013 marketing year. If the country decides to stockpile its cotton reserves this winter, the resulting bump in cotton prices could boost U.S. acreage higher for 2013.

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