West African cotton producers are trimming forecasts as low world prices, a weak dollar and administrative woes dull farmers' enthusiasm for "white gold". Output from the region's main producers is seen dropping to 2.47 million tonnes in 2006/07, from over 2.52 million the previous year, as optimistic targets are cut.
West African producers and their governments accuse Western countries which subsidise their farmers of flooding the world market with cheap cotton, leaving African growers struggling to make ends meet from what is for many their only cash crop.
"Farmers have the illusion they are earning a living, but day by day they are getting poorer," said Tiena Coulibaly, a former finance minister of Mali now reforming the cotton sector.
Mali has hacked its 2006/07 forcecast back to 435,000 tonnes from an initial 600,000 tonnes, versus 585,000 tonnes last year.
African ministers fear that Washington's 2007 farm bill could increase the flow of heavily-subsidised US cotton onto world markets. France's sale of its majority stake last month in leading cotton producer Dagris, which owns or manages several African cotton firms, has also contributed to uncertainty.
Benin is traditionally one of the region's top producers and up to 40 percent of its people depend on cotton. But output last season plunged to 189,000 tonnes from 405,000 the previous year.
As the harvest began in November, the region's top grower Burkina Faso was on track for a record 800,000-tonne crop, but its main ginner SOFITEX has since cut that by 100,000 tonnes.
To stop the crisis spreading across the economy, the state has allocated 50 billion CFA francs ($101.3 million) to guarantee bank loans.
SOFITEX Managing Director Celestin Tiendrebeogo said the euro/dollar exchange rate was inflicting "heavy punishment for businesses exporting from the CFA franc zone".
The CFA franc shared by 14 African countries is pegged to the euro, which since mid-2002 has gained nearly 45 percent on the dollar, in which world cotton prices are denominated.
Even in dollar terms, prices have swung wildly in recent years with spot prices on the New York Board of Trade falling to a more than 10-year closing low of 28.86 US cents/lb in October 2001 amid global growth worries after the September 11 attacks. Chinese demand helped cotton to a long-term closing peak of 82.11 cents in 2003 before another collapse almost halved the price. Cotton ended last week at 58.20 cents.
Togo's state cotton company has run up debts of 21 billion CFA to local producers, and only 83,000 farmers are registered as cotton producers this year, down from over 141,000 last year.
Output is likewise expected to slump, to 42,000 tonnes - less than a quarter of peak production of 180,000 tonnes - with plantings less than 40 percent of the targeted 160,000 hectares.
Nearby Ivory Coast has additional problems after a 2002/03 civil war in which rebels seized the cotton-growing north and set up their headquarters in the second city, Bouake.
"Our cotton research station based in Bouake is no longer operational. It became a battle ground between the two sides in 2002," Nicolas Kouadio N'Guetta, secretary-general of the national industry body Intercoton, told Reuters. This season's forecast 226,000-tonne output is barely half Ivory Coast's record output of 402,000 tonnes in 1999/2000.
"We have a problem with financing inputs. There is only money for inputs for 115,000 hectares out of the 300,000 hectares available for planting cotton," N'Guetta said, although some seeds had been imported from Mali and Burkina Faso.
Cameroon's cotton firm SODECOTON spent more than 4 billion CFA francs, or 40 percent of its reserves, to pay farmers an extra 20 CFA/kg above the market price in 2005/06, and issued a plea a few weeks ago for state aid to deal with low prices.
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