USDA: Drought Takes 3.1% Bite Out of U.S. Crop

According to USDA, the stubborn drought conditions that have plagued huge sections of the cotton-growing regions of the United States will reduce the country’s total production by more than 3% this season. As the drought has dragged on, it has pushed up futures prices, which are hovering around 75 cents/lb at press time – a gain of 11% since June 1.
The exceedingly dry conditions will drop U.S. fiber output from 17.65 million bales – the amount USDA estimated in August – to 17.11 million bales. The production of extra long staple cotton (ELS), primarily grown in the U.S. Southwest, is expected to take an especially large hit, dropping 23% from last year’s total to 657,000 bales.
The estimated yield of 786 lbs/acre is up slightly from the August estimate of 784 lbs/acre, but down about 0.5% from last year’s yield of 790 lbs/acre. Total exports from the United States, the world’s largest exporter, are expected to reach 11.8 million bales this marketing season (which began Aug.1), up from the previous year’s total of 11.71 million bales. Stocks are expected to increase dramatically, rising 58% from 3.35 million bales this year to more than 5.3 million bales for 2012/13.
Although the U.S. production estimate was revised downward between August and September, the country’s total output is still expected to generate a 10% increase from last season. That’s contributing to the 2 million-bale, year-over-year increase in global stocks , which USDA are now projecting to reach 76.5 million bales.