The latest U.S. Department of Agriculture (USDA) estimates for 2017/18 project global cotton production at approximately 120.8 million bales, 13 percent above the previous season, as relative prices favored the planting of cotton versus alternative crops.
India, China, and the United States lead the global increase and remain the largest cotton producing countries. In 2017/18, these countries are forecast to account for 63 percent of world cotton production, similar to the previous 3-year average.
General Comments
U.S. 2017 Cotton Crop Forecast Higher in September According to USDA’s September Crop Production report, the 2017 U.S. cotton crop is forecast at approximately 21.8 million bales, 1.2 million bales above the August estimate and nearly 4.6 million higher than the 2016 crop. The higher September forecast is attributable to an increase in both area and yield, and would be the largest U.S. production since the 2005 crop, if realized.
Total 2017 U.S. cotton planted acreage was raised more than 4.5 percent in September based on acreage reported to USDA’s Farm Service Agency (FSA). Planted area was estimated at 12.6 million acres by USDA’s National Agricultural Statistics Service (NASS), while harvested area was projected at 11.5 million acres—up from 11.1 million acres forecast in August.
As a result, abandonment in 2017 is expected near 9 percent, compared with 5.5 percent in 2016.
The national yield is forecast 41 pounds above 2016 at 908 pounds per harvested acre, a record. For current production estimates by State, see table 10. Also, note that NASS indicated in the latest Crop Production that the impact of Hurricane Harvey may not be fully reflected in the September report.
The 2017 U.S. upland production is forecast at 21.0 million bales, 27 percent above last season and the highest in 12 years. During the previous 20 years, the September upland cotton forecast was below the final estimate 11 times and above it 9 times. Past differences between the September forecast and the final upland estimate indicate that chances are 2 out of 3 that 2017 production will range between 20.5 million and 23.1 million bales.
Compared with last season, the 2017 upland cotton crop is expected higher in each region of the Cotton Belt (fig. 2). For the Southwest, upland production is projected at about 10.5 million bales, 19 percent above 2016 and a record. Planted area is estimated at about 7.6 million acres, the largest since 2011.
With growing conditions relatively favorable this season, harvested area is currently estimated at 6.5 million acres—a 36-year high; however, abandonment is reported at about 14 percent, compared with 8 percent in 2016. The Southwest yield is forecast at 769 pounds per harvested acre, which is slightly above 2016 and the second highest on record behind 2007’s 840 pounds per acre.
In the Southeast, cotton production is forecast at nearly 5.2 million bales in 2017, above the last two seasons but similar to 2014. The larger crop is the result of higher area—slightly above the 5-year average—and expectations for improved yields.
In 2017, the Southeast yield is forecast at 990 pounds per harvested acre, 91 pounds above the average and the second highest on record behind 2012’s 1,033 pounds per acre. In the Delta, 2017 cotton production is also expected to expand to 4.4 million bales, as area and yield increase for the second consecutive season; if realized, production would be the largest since 2011.
Area this season is 500,000 acres above the 5-year average at 1.9 million acres, while the yield is near a record at 1,113 pounds per harvested acre.
In the West, the 2017 upland crop is projected at 951,000 bales, 34 percent above 2016, as area reaches its highest level in 5 years. With area at approximately 300,000 acres and a yield of 1,507 pounds per harvested acre forecast, the region’s upland crop is near the 10-year average.
In addition, the extra-long staple (ELS) crop—grown mainly in the West—is forecast at 727,000 bales in 2017, up from 569,000 bales in 2016 and the highest since 780,000 bales were produced in 2012. Although harvested area is forecast to rise in 2017, yield is expected to decrease slightly to 1,441 pounds per harvested acre.
U.S. cotton crop development in early September is running behind last season and the 5-year average. As of September 10, 34 percent of the cotton crop had bolls opening, compared with 40 percent for both last season and the 2012-16 average. However, U.S. cotton crop conditions have continued above last season and the 5-year average since early July.
As of September 10, 63 percent of the 2017 crop area was rated “good” or “excellent,” compared with 47 percent last year, while only 11 percent was rated “poor” or “very poor,” compared with 16 percent in 2016.
Export and Stock Estimates Increased in September
Along with the U.S. cotton crop increase this month, 2017/18 demand was raised 700,000 bales to nearly 18.3 million, the largest since a similar amount was recorded for 2010/11. While the 2017/18 forecast for U.S. mill use was unchanged at 3.35 million bales, U.S. exports accounted for the entire increase this month.
For 2017/18, U.S. cotton exports are projected at 14.9 million bales, similar to 2016/17’s final estimate. Despite increased export competition in 2017/18, larger foreign import demand for raw cotton—supporting an above-average gain projected for world consumption—along with the larger U.S. crop is expected to keep U.S. exports at one of the highest levels on record.
As a share of global trade, U.S. cotton exports are projected to account for 39 percent of world exports in 2017/18, slightly below 2016/17.
U.S. 2017/18 ending stocks are now forecast at 6.0 million bales, more than 3 million bales above last season’s estimate. With the expected stocks-to-use ratio rising to 33 percent by the end of the season—more than double that of 2016/17— the ratio would be at its highest since 2008/09 when the stocks-to-use ratio approached 38 percent.
Based on the current supply and demand estimates, the 2017/18 upland cotton farm price is forecast to range between 54 cents and 66 cents per pound. The midpoint of 60 cents per pound is 8 cents below last season’s estimate. The final 2016/17 upland farm price will be released in October.
For 2016/17, U.S. demand and stock estimates incorporate final data for the season. Cotton mill use reached 3.25 million bales in 2016/17, 6 percent below the previous season as competition with synthetic fibers pushed cotton mill use to a level not seen in over a century.
Final U.S. cotton exports reached 14.9 million bales, nearly 5.8 million bales above 2015/16 as a large supply of high quality cotton pushed shipments to the second highest on record.
Based on the supply and demand estimates and stocks data collected by FSA and NASS, U.S. cotton ending stocks for 2016/17 are estimated at 2.75 million bales, compared with 3.8 million bales in 2015/16.
Source: http://agfax.com/2017/09/15/cotton-outlook-world-production-projected-highest-in-5-years/