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March 18, 2009

World cotton acreage to decline

by Elton Robinson

USDA is projecting a world cotton crop for 2009-10 of 107 million bales, a 2.3 percent decline from the previous year and the lowest output since 2003-04. In a report presented at the Agricultural Outlook Forum in Arlington, Va., in late February, USDA said the decline reflects significant reductions in China, Pakistan and the African Franc Zone countries, which were partially offset by higher production in India and Australia.

The remainder of the world’s major cotton producers are projected to produce the same or slightly less cotton in 2009-10, according to USDA. Global harvested area is projected to fall to 73.4 million acres while average yield is expected to increase to 700 pounds per acre.

In China, 2009-10 production is forecast at 33 million bales, down 3.5 million bales (nearly 10 percent) from a year earlier. Cotton area is forecast at 13.2 million acres, a decline of about 11 percent from the previous year. China’s cotton prices have been weakening and prices to farmers fell below expectations for the 2008 crop.

Prices for food crops in China remain high enough to attract some acreage from cotton. USDA says state reserve purchases of cotton give some price assurance to cotton farmers, but the government is also supporting grain prices. Anecdotal reports suggest that cotton area will be reduced at least 5 percent in the Xinjiang region and more than 10 percent in the eastern production regions.

India’s 2009-10 production is projected at 24.5 million bales, higher than the previous year’s output by 6.5 percent. Area is projected to decline only marginally by 0.5 percent to 23 million acres, mainly because cotton prices to farmers were supported by the government purchase program in 2008-09. The yield is expected to grow by 7.1 percent assuming normal monsoon conditions.

The increased use of Bt cottonseed, improved crop management practices and irrigation systems are expected to support yields. However, the rate of yield increase is slowing as Bt adoption reaches the saturation point. According to the government of India, Bt cotton now accounts for more than 70 percent of total cotton acreage in India.

Delta Farm Press

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