Georgia cotton farmers don't want to jinx it. But right now, it looks like they might have something they haven't had in years: a lot of cotton to sell for relatively good prices.
It's rare in farming, or any other business, to have high supplies and good prices at the same time. “But this year, Georgia farmers might get both,” says Don Shurley, a University of Georgia Extension Service cotton economist.
The weather, so far, has been good to the state's cotton growers, and they expect to harvest a lot of cotton. Less fortunate weather in other cotton-growing states and the world's continued demand for more cotton products might mean better prices, too.
“Not every state has enjoyed good cotton-growing weather like Georgia,” he says. Other leading cotton-producing states, such as Tennessee, California and Texas, expect low yields this year.
According to the U.S. Dept. of Agriculture, Georgia farmers expect to yield about 744 pounds of cotton per acre for a total of 2 million bales. That's not a record, but it's a good year.
Cotton prices are about 58 cents per pound right now. Again, this is no record. But it's good news compared to prices in recent years.
Last year, Georgia produced about 1.6 million bales of cotton and sold it for as low as 40 cents per pound.
The 2002 cotton crop was valued at $397 million. Because of improved yields and better prices, the 2003 crop is expected to be worth $571 million, Shurley says.
“And this extra cotton money will for the most part go to the rural areas of Georgia that produce cotton,” he says.
But every silver cloud has a dark lining, so to speak. Georgia farmers still have to get this year's crop through the harvest, starting in October and running through November.
Farmers want dry weather during harvest. Rain hurts yields and prevents farmers from harvesting a quality crop, Shurley says. The Gulf of Mexico has thrown some hard tropical weather punches at Georgia during past cotton harvests.
Prices could drop before the end of harvest, too, he says.
Overall U.S. production is expected to be about 17 million bales this year. This is about 100,000 bales less than last year, but still much more than the U.S. textile industry expects to buy from U.S. sources.
The U.S. textile industry continues to buy less and less U.S.-grown cotton. Last year, it bought 7.3 million bales. This year, it will buy 6.6 million bales.
U.S. cotton farmers now depend on foreign buyers to buy the bulk of U.S. cotton. This year, 11.8 million bales of U.S.-grown cotton are expected to be sold to foreign buyers.
This puts U.S. growers at the mercy of world cotton supply and demand. This year, other countries expect to supply about 7.5 million more bales of cotton, 5 million of which is expected to come from China.
China's cotton production numbers have never been clear, Shurley says. And world cotton buyers never know if China's numbers are right. So for now, world cotton buyers are waiting to see if China begins to dump its increased production on the world market.
If they do, Shurley says, it will certainly lower cotton prices for Georgia farmers trying to sell their cotton in the world market.
The last time the state's farmers had high production coupled with good prices was in 1996. That year they had 747 pounds of cotton per acre and sold it for about 71 cents per pound.