Over the past several months, outside influences on the cotton industry have felt like the Dahlonega Mine Train at Six Flags Over Georgia: ups, downs, dramatic twists, and lots of bumps along the way.
Producers have seen proposed policies fail, others be implemented, a significant market uptick, one of the US’s largest overseas markets be closed then open again, and now significant rains that have slowed down progress on the 2018 crop.
Thankfully there are signs that the ride is about to level off.
The elephant in the room was (and still is) China. Last fall, Beijing announced restrictions on plants that turn recycled goods into cheap polyester to help curb their pollution issues, which was great news to a depressed cotton market.
Then, in what has proven so far to be a war of words, the central government announced new import tariffs on cotton and several other commodities coming from the US.
The importance of this market was seen after President Trump announced a temporary end to the trade war as December 2018 cotton futures closed up 161 points, and have risen further (close to $0.87/lb) as of the time this article was written.
Some lawmakers obviously forgot (and continue to forget) that the commodity title of the Farm Bill is put in place to stabilize markets as well as the food and fiber supply that steadies food and fiber prices to give American consumers the lowest grocery prices in the world.
These thoughts are part of why cotton was left out of the 2013 Farm Bill, and what led to the demise of the Farm Bill draft that was voted down on the House floor on May 18, 2018. However, this is not all doom and gloom, as Congress also made seed cotton a covered commodity in the Bi-Partisan Budget Agreement and leaders have been kind to cotton, so far, in Farm Bill drafts.
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Weather has also been up and down. Rainfall was fairly average until the beginning of May, when it turned hot and dry. Since the middle of May, the Jetstream has brought consistent tropical moisture and seemingly centered it on the main cotton belt of Georgia.
These daily showers combined with Subtropical Storm Alberto, hopefully not related to 1994’s Hurricane Alberto which dumped over 25 inches of rain on southwest and central Georgia and cost the state incurred over $125 million in damage to Georgia’s infrastructure alone, have slowed planting down to a near halt.
While this ride is appearing to level out, I would recommend that everyone keep their arms and feet inside the ride. One stroke of a pen in Beijing, one tweet, or one storm could change that for everyone. Though, as one southwest Georgia cotton producer recently commented, “that’s farming.”