Cotton yield lowest in 40 years

Cotton yield for the 2007/2008 season is estimated to be the lowest in 40 years, according to the latest market report by Cotton South Africa (Cotton SA).
South African production is estimated to be 3% down since last season at 52 497 lint bales. Local cotton imports from Swaziland, Botswana and Namibia are expected to decrease by 2% to 1 477 lint bales.
Hennie Bruwer, CEOo of Cotton SA, ascribed the downward trend in production to a growing perception that cotton farming is no longer a viable production option, especially in view of the more favourable prices achieved by crops such as maize and sunflower. Soaring prices offer farmers greater profitability, while requiring fewer management inputs.
Cotton prices currently trade at around R1 195,86/t compared to white and yellow maize trading at around R1 681/t and R1 760/t and sunflower seed trading at around R4 850/t.
Bruwer said the same trend is visible in the US and other Western Countries. Cotton production in the US declined by almost 12% due to better prices attainable for other commodities and the increased demand for biofuels.
In some countries production has declined due to climatic conditions. Production in China declined by 3%, and it declined 11% in Pakistan, 12% in Tturkey and 22% in West Africa. As a result, total international production has fallen 3% to 25,8 million tons.
India and Brazil are the only two major cotton producers where production is expected to increase this season – in India by 11% to a record 5,3 million tons and in Brazil by 5% to 1,6 million tons.
The International Cotton Advisory Committee forecasts a 10% decline in world stocks to 11,4 million tons. World trade is expected to increase by 9% to 8,9 million tons, due to larger Chinese imports. Iimports by the rest of the world, however, are expected to decline by about 200 000t.
World cotton consumption is projected to increase to 27,1 million tons, which is only 2% higher than last season. Bruwer ascribed the slower rate of growth to a decline in global economic growth as well as the increase in cotton prices. – Glenneis Erasmus