With reduced cotton acreage and a challenging 2015 planting season, attractive cottonseed prices may not hold through the fall.

“Due to the smaller crop, prices are definitely going up and will be relatively strong this fall,” predicts cottonseed merchandiser Larry Johnson of Cottonseed LLC, La Crosse, Wisconsin.

Plentiful global cotton supplies have put market prices below the cost of cotton production, explains Tom Wedegaertner, director of cottonseed research and marketing, Cotton Incorporated. “In addition to growers committing to fewer acres, untimely rains have put a damper on planting and could increase abandonment rates, further reducing the cottonseed supply available to dairies.”

The USDA World Agricultural Supply and Demand Estimates report, released June 10, shows the 2015 anticipated harvested crop at 8.6 million acres, a decrease of 0.75 million acres, compared with last year. The 2015 crop is forecast to produce 14.5 million bales (compared with an estimated 16.32 million bales in 2014), netting about 5.1 million tons of cottonseed, compared with 5.7 million tons in 2014 – an 11 percent decrease.

With softer milk prices, some dairy producers may be weighing their feed options, while others will feed cottonseed “no matter the price,” Johnson says. “Its combination of protein, fiber and energy works well with other ingredients to deliver a balanced ration.”


With cotton production, Texas is king

Experts advise dairy producers who are assessing their cottonseed buying strategies to keep an eye on growing conditions in the Lone Star State. Texas grows about half of the U.S. cotton crop.

“The active El Niño weather pattern has made its presence known in Texas,” says John R.C. Robinson, Texas A&M University professor and extension specialist economist of cotton marketing. He says record rainfalls throughout the state prevented planting in many areas.

Both yield and quality could be in jeopardy, he adds. “South of Corpus Christi, some growers cut their losses by taking preventive planting.”

In the Lubbock area – the densest cotton-growing area of Texas – moisture conditions have not been so extreme.

“Barring no major challenges, this area may achieve high cotton yields on dryland acres due to El Niño’s plentiful moisture,” Robinson says. “This boost could compensate for the losses near the Gulf Coast and potentially support more cotton production.”

In the Mid-South, March through May rainfall was 150 percent of average, reports H. Scott Stiles, University of Arkansas extension economist, who expects a 31 percent drop in cotton acres in the five-state area compared with last year.

“Most of the decline is market related, and about 10 percent is weather related,” he says. “Given the late start, growers will need near-perfect growing conditions from here forward to be profitable.” PD

—From Cotton Incorporated news release