In the news this week is Tropical Storm Erika. Most of the weather forecast have Erika going up the East Coast or going into the Gulf of Mexico along the coast of Florida. Either way, producers should be very aware of Erika and its potential to interrupt defoliation and harvest in the next week. There are already a few fields of peanuts that have been dug/inverted in South Georgia and there are a many cotton fields that will see defoliation in the next week or two. We are encouraging all producers to vigilantly check the weather forecast and understand the potential damage that Erika may produce. Almost all producers check the weather daily, but with hurricanes and tropical storms it becomes even more important as some storms can linger for several days longer than anticipated.
While some of our later planted Georgia cotton could use a good rain, Erika may be more than producers are wishing for at the moment. With a cotton market still struggling to make it to 70 cents throughout the growing season, the last thing we need is trouble at harvest time.
There are several good resources available to track the latest updates on the weather and climate in Georgia.
Pam Knox, UGA Agricultural Climatologist, daily blog. Here is the latest post about Erika.
GaClimate.org for daily updates on current weather/climate conditions in Georgia.
The National Weather Service’s National Hurricane Center.
And of course there are others like The Weather Channel’s hurricane page and Accuweather’s hurricane updates.
Celebrities have recently been in the news as supporters of mandatory GMO labeling. We have written in the space before about how mandatory GMO labeling will not be good for anyone, be it a farmer, food processor, or the consumer. Going a step further and investigating the data will show one that GMOs have been beneficial to cotton farmers.
Using USDA-NASS statistics from 1866 – 2013 to generate the graph below, one can see that the Georgia cotton farmer has gone from producing 2.7 million bales on 5.1 million acres in 1914 to producing 2.9 million bales on 1.45 million acres in 2012.
This is a true testament of the combined hard work of farmers, scientists, and the industry to increase the per acre yield and quality of Georgia cotton. Many events such as the eradication of the boll weevil, introduction of strip-tillage, and new crop protection chemistries have lead to this dramatic increase in yields. One that is less talked about though is the introduction of GMO cotton. The graph below is a zoomed in version of the above graph but only showing 1980 – 2013. The vertical line represents 1997, the year Roundup Ready and Bt cotton was introduced in the U.S. market. Though prior to 1997 we saw production (red line) go above acres (blue line), the per acre yield increase (the spread between the two lines) has risen dramatically since the introduction of GMO cotton.
Looking specifically at the farm-level economic impact of this we can see that the five-year average GA cotton yield from 1991 – 1996 was 717 lbs/acre. From 2010 – 2014 the five-year average yield was 887 lbs/acre. Using NASS data again we can see that the five-year average price received of cotton in GA from 2010 – 2014 was $0.82/lb. That means that GMO cotton has increased the revenue of the GA cotton farmer by $139.40/acre. It must be noted that this doesn’t take into account the additional cost of GMO seed, we are only looking at the additional revenue from growing GMO cotton.
The biggest news this week was the cotton market jumping about 5 cents in just a few days. Just last week we were talking about 70 cents being a far stretch as the Dec15 contract approached 60 cents. Today (8/14/15) we are approaching 66 cents for the Dec15 contract. Here are some good analysis for further reading.
Cotton Futures Soar Limit Up, as US Slashes Harvest Hopes
USDA Catches Cotton Market by Surprise With Big Drop in Forecast
Cotton Rises on Surprise Forecast…
Last week we had the pleasure of meeting some cotton producers from California and Arizona at the NCC Producer Information Exchange (PIE) tour of Georgia.
Click here for our PIE Tour photos from Facebook.
Click here to see photos from the PIE Tour visit to 1888 Mills in Griffin.
This week the UGA research station in Midville held it’s annual grower field day. Click here for some photos of the event from the UGA Tifton Campus.
Lastly, hold September 9th on your calendars for the annual Cotton & Peanut Field Day at the UGA Tifton Campus. More info to come soon.
This week the cotton market took another blow by dropping a few more cents. While almost everyone has been waiting for the market to climb its way back to 70 cents, it seems now that the chances of that happening are bleak. Since there are many sources of market analysis available we will not try to analyze the market here other than trying to hash out some of the fundamentals behind the price moving lower. Of course the largest factor weighing down the market is the huge surplus of cotton that has been built up in China over the last 5 years. Add in the fact that the Chinese and Indian (the two largest cotton producers) governments continue to have cotton programs that do not encourage their growers to reduce acreage when cotton prices drop. In the US (the third largest producer) cotton farmers have reduced the number of acres planted to levels not seen since the 1980s. This would seem to help pull the market up and force some of the cotton stockpiles to be sold, but it has done little to the market. Also, it would appear that the US crop is going to be quite large, at least in Texas and Georgia, the two largest US cotton growing states. Reports from West Texas indicate that they could produce a bumper crop given the moisture levels present there that haven’t been seen in four years. Across Georgia it appears that the cotton crop is doing well. There are isolated areas that have seen little to no rain all season but the overall crop looks to be on track or surpass the 850-950 lb/ac levels we have become accustom to in South Georgia.
Even with a good looking crop now the real story will come at harvest. Harvest time can be very nerve racking for producers since most producers in the Southeast know that we are always one hurricane away from losing a whole crop. A recent UGA Extension blog, Climate and Ag in the Southeast (which I recommend you follow), recently posted the latest climate predictions for the tropical storm season. NOAA is predicting a 90% chance of having a below normal tropical storm season. While this is just a prediction, hopefully it will ease the nerves cotton producers who know that making a bumper crop this year is imperative to surviving these low cotton prices.