Soybean rust's arrival in the U.S. is rearranging the domestic cotton trade's perspective on American cotton acreage in 2005.
It has gone from anticipating reduced cotton acreage this season in the wake of a module-busting 2004 crop of 22.82 million bales to predicting acreage similar to 2004 or maybe even slightly more, according to Robert Norris, president of Cotton Council International.
Norris, who heads Calcot, the largest cotton marketing cooperative in the West, added “duplicating yields is another story.”
Acreage may well increase, but it would be a miracle to repeat yields in a virtually perfect growing season and a record yielding year not only in the U.S. but the Northern Hemisphere as well, Norris reported at a CCI briefing during the recent Beltwide Cotton Conference in New Orleans.
Regardless of yields this season, a repeat of 2004 acreage this spring will serve to heighten the marketing challenge CCI, Cotton Incorporated, Supima and others face in selling U.S. cotton and American made yarn and textiles worldwide into a market where for the first time in nine years cotton production significantly exceeds demand.
It has become an all-out marketing blitz for CCI as the export market for U.S. cotton, yarn and textiles take Norris worldwide in his role as chief spokesman for CCI.
High quality U.S. cotton is coveted by world textile mills willing to pay a four-cent per pound premium for contamination free U.S. cotton delivered with a worldwide sanctity behind its contracts backed by technical assistance from Cotton Incorporated.
As much as Norris and the CCI staff promoted U.S. cotton, it was China that seemed to dominate in talks with mills worldwide. Coming into the era of quota free textile exports into the U.S., many of the non-Chinese customers of U.S. cotton are concerned that their U.S. markets will disappear under the onslaught of virtually unbridled Chinese exports.
The message the mills received at gatherings sponsored by CCI is that companies like Wrangler and others which rely heavily on China's textile industry for products are not “putting all their eggs in one basket” and there will be business for textile mills outside of China.
Of course China is the biggest market for U.S. cotton, taking 5 million bales last season.
Just as the Cotton Seal has driven the sales of cotton products in the U.S. to unprecedented levels, CCI's Cotton USA is attempting to do the same thing with U.S. cotton products worldwide. It generated $190 million in sales for the Cotton USA logo worldwide and that number is expected to grow as more licensees sign up for the branded marketing program. CCI has 266 licensees worldwide.
This cotton merchandising goes on in a politically charged world where not everyone views America kindly, but Norris said he has yet to find any anti-American sentiment stigmatizing the Cotton USA logo.
Norris said U.S. cotton faces a “dramatically changing world” ahead. International trade issues have taken on “even greater significance” against a backdrop of changing global dynamics in apparel sourcing and gyrating prices.
Norris pledged that CCI will continue to adjust its Cotton USA program to stay in step with those changes.
The longtime marketer of California and Arizona cotton said cotton fiber and textile production must meet synthetic competition head on in rapidly developing markets like India, China, Brazil and Turkey to be successful, said Norris.
Norris made it clear CCI will travel to anywhere in the world to meet that competition.
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