Cotton Production and Demand
The USDA’s latest crop reports had some upward adjustments for cotton.
Domestically cotton crop production will be up 25% over the last season.
World Agricultural Outlook Board Chair Mark Jekanowski discusses some of the changes in December.
“Domestically, cotton was one of the few commodities for which we got new production data from NASS. With that, they gave us a revised yield estimate. US cotton yield estimates up 5 pounds per acre, a relatively small production increase for cotton. We didn’t make any changes to any of the other major balance sheet components in terms of domestic exports or ending stocks. Such a small amount is all going into the residual category. And not change as well to the season-ending market price for cotton. We’re sticking with $.90 per pound.”
While the price didn’t change,$.90 per pound is almost $.20 higher than the last year.
The reasons cotton’s price is remaining high has something to do with the pandemic. COVID shutdowns and regulations on travel have translated into spending on physical goods like clothing. Relative to the same period in 2019, consumer spending on apparel has been up 25 percent over the past six months, according to the U.S. Bureau of Economic Analysis. Data shows normal rates of spending growth for apparel are 2 to 3 percent.