Doane Daily Cotton Commentary

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Mississippi:

Cotton Prices Lag behind production

Patti Drapala
MSU Ag Communications

Starkville, Mississippi (August 8, 2008) – Cotton farmers are having a good production year despite a late start, but time is running out for prices to catch up.

  Mississippi State University Extension agronomist Darrin Dodds said a wet spring across Mississippi’s cotton-growing areas in east Mississippi and the Delta delayed planting.
 
  The wet planting season was followed by extremely dry conditions in a large portion of the state. Both the planting delay and the dry weather in June and July may lead to a later-than-normal harvest in some areas.

  “We may see a delay of two to four weeks for harvesting irrigated cotton,” Dodds said. “Dryland cotton harvest probably will occur within the normal timeframe.”

  He said by early August cotton consultants and farmers were reporting occurrences of cut-out, or cotton’s final growth stage before bolls open, in many dryland fields. Bolls there have filled out well.

  Irrigated cotton also is developing well, Dodds said. Farmers are seeing a range of four to seven nodes above white flower, which is promising.

  Insects and weeds have not hampered the crop’s development this year. Problems creeping up in isolated spots have been controlled with timely applications of specific pesticides.

  “The No. 1 insect problem in cotton in the central and south Delta is spider mites,” said Extension entomologist Angus Catchot. “Hot, dry weather is ideal for spider mite outbreaks, and farmers worked hard to control them.”

  Catchot said farmers reduced populations of tarnished plant bugs and bollworm moths in some areas. Aphid outbreaks in the hills area have been thwarted with a naturally occurring fungus.

  Some farmers in the Delta encountered weed resistance to glyphosate-based herbicides developed for today’s cotton production systems.

  “Glyphosate resistance is a hot issue in weed control because there are not many alternative chemistries available with the systems we have,” said weed scientist Jason Bond, who is based at MSU’s Delta Research and Extension Center in Stoneville.

  Farmers may have to re-evaluate their production schemes if glyphosate resistance in weeds becomes widespread.

  Despite problems they face, many farmers expect yields to be good in 2008, but their expectations for better prices are tempered by the economic reality of the past two years.

  “The 2008 crop appears to be as good as or even a little bit above the average, but it probably won’t surpass the statewide average of 960 pounds per acre reached last year,” Dodds said.

  Cotton yields in 2007 were the high point of a production year hampered by higher fuel and fertilizer costs and lower prices.

  In 2006, farmers planted 1.2 million acres of cotton. Then fuel and fertilizer prices rose dramatically, but cotton prices did not. Farmers responded to the situation by planting 665,000 acres of cotton in 2007, a decrease of 46 percent from the previous year.

  Cotton prices held steady, but expenses continued to climb. Soybeans and corn became attractive because their prices kept increasing. After assessing the economic outlook at the end of 2007, farmers cut back cotton planting intentions to 365,000 acres in 2008.

  On average, the cost of production for cotton is about $700 an acre, Dodds said. However, fertilizer prices, pest pressure and pumping expenses could inflate this cost for individual farmers.

  Cotton prices approached 98 cents per pound early in the spring, but farmers had a difficult time finding buyers, he said.

  “Price is the determining factor for acreage,” Dodds said. “Farmers compare the relatively low prices for cotton with the higher prices for grain crops. For cotton acreage to go back up, the price farmers receive must be competitive with soybeans and corn.”