Industry analysts are divided over how much cotton US farmers planted, but they unanimously declared on Wednesday that a withering drought may severely pinch production and yields in 2006/07.
The US Agriculture Department will release its annual plantings report on Friday. Some analysts believe US cotton sowings will rise from the USDA estimate last March of 14.6 million acres, but most others feel the number will be down.
Mike Stevens, an analyst for brokers SFS Futures in Mandeville, Louisiana, said US cotton plantings will likely hit 14.76 million acres.
"After two successive profitable bumper crops, why switch horses in mid-stream when you have been riding a winner?" he said.
Sharon Johnson, cotton expert for First Capitol Group in Atlanta, Georgia, believes total plantings will amount to 14.38 million acres, the highest since 2001 but below the USDA's March planting intentions figure of 14.6 million.
Alan Feild, an analyst at broker iamhedged.com in Memphis, Tennessee, also pegged the crop at 14.38 million acres. But John Flanagan of Flanagan Trading Corp in North Carolina forecast US cotton sowings 100,000 acres lower, at 14.63 million. The common thread among analysts is the impact that parched conditions will have on the size of the crop.
"Weather-related concerns appear to be escalating in the US," Johnson said, adding that given the expected high level of abandonment this year, the trade will be paying close attention to the amount of harvested area in US cotton. "You're seeing other regions suffer," she said, adding farmers in China, the world's biggest producer and consumer of cotton, also "got off to a poor start."
With heat zapping the crop, yields and output are seen taking a serious hit. Feild, for one, believes "only 12.78 million acres will be harvested because there will not be a dry land crop in Texas this year."
"High abandonment can mean a downturn in yields and given the latest crop conditions, that scenario may play itself out," Johnson said.
Feild said US cotton production may fall to 17.9 million (480-lb) bales in 2006/07, sharply lower than the USDA estimate in its June crop production report of 20.7 million bales, although cuts by other analysts of their crop estimates are far more modest.