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Cotton acreage report belies true nature of drought-stricken Texas crop

Cotton acreage report belies true nature of drought-stricken Texas crop
USDA's June 30 planted acreage report indicates Texas producers increased their plantings by 28 percent this spring. Normally, that would mean a sharp increase in the state's cotton production, which would be great news with prices as high as they've been. But the USDA numbers don't take into consideration a near 100 percent abandonment rate on the dryland cotton crop.

Anyone looking at the June 30 USDA Planted Acreage report with no knowledge of the current state of the High Plains/Texas cotton crop would think that a 28 percent statewide increase in acreage and some good weather would translate to some record-breaking yields later in the year.

  However, we all know this is certainly not the case as area producers face a near 100 percent abandonment rate on the dryland cotton crop, meaning that about half of the just over 4.2 million acres planted has failed due to extreme drought that kept planted seed essentially in dry storage underground. That 4.2 million acres planted is about a 14 percent increase from 2010, when 3.7 million acres of cotton were planted.

  Although the increase in acreage came as no surprise, the amount of the increase was a little more than many had originally thought. Experts attribute the increase to many factors, primarily the price of cotton.

  Adjusters have begun working claims in dryland fields in the PCG service area, as the 15-day window from the final planting date has come to pass across the region. Preliminary abandonment rate estimates will be released in August.

  "Right now, if we consider that pretty much our entire dryland crop will be abandoned, that means the High Plains economy could take a hit of around $1 billion, and that's a conservative estimate at this point," PCG's Executive Vice President Steve Verett said. "We could be looking at our highest overall abandonment rate since 1992, when it was 53 percent."

  With little forecasted chance for rain in the near future, producers with irrigated crops could be facing some tough decisions with regard to water and the ability to carry that crop to harvest as well. Some producers estimate that their crop can last another two weeks under current conditions. Each day without rain continues to become more and more costly. Producers in far South Texas received some rain this week, but it could not have come at a more inopportune time as they prepare for harvest.

  Statewide, USDA reports that 7.1 million acres of cotton were planted, a 28 percent increase from 2010 when Texas producers planted just over 5.5 million acres.

  The June Acreage report is based on producer surveys of actual planted acreage information. It is the market's first glimpse of how many acres have actually been planted to various crops during the current growing season and sets the stage for evaluating where the crop stands at this point. Up until now acreage discussions have been based on survey results designed to get a handle on producer intentions before they had actually put a seed in the ground. 

Mary Jane Buerkle is with Plains Cotton Growers.

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