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Agricultural News

Empty Oklahoma Cotton Storage Warehouses May Fill This Fall With Big Southwest Crop

Mon, 02 Aug 2010 12:05:45 CDT

Empty Oklahoma Cotton Storage Warehouses May Fill This Fall With Big Southwest Crop Last week, Jay Cowart, director of warehousing operations for the Plains Cotton Cooperative Assn., walked across the concrete floor of one of the many empty warehouses located on the southwest edge of this city well-known for being a center for cotton production. (the picture here is of Jay in some of that empty storage space in Altus.)

To be accurate, all of the PCCA cotton storage located in North Texas, Oklahoma and Kansas will hold 1,150,000,000 480 pound cotton bales. Last week, when interviewed, Cowart said there were 4,840 bales stored in all of the warehouses.

Using US Dept. of Agriculture predictions on how much cotton will be harvested in the three states, Cowart believes his farmer-owned cooperative will receive 1.6 million bales this fall, more than can be currently stored.

Approximately three years ago when the last economic depression dismantled world economies and global trade, retail stores and wholesale suppliers and clothing manufacturers and mills, followed by raw product suppliers like PCCA were stuck in a pipeline with no light at the end, Cowart said.

"Then in 2009," Cowart said. "the global economy began to recuperate and department store managers, to satisfy the demands of consumers, began once more to order denim clothing, but the wholesalers and garment companies had nothing to send them right away.

"All of the production from the farmer to the retailer had stopped and supplies had dwindled. To satisfy the new demands, cotton production cooperatives like PCCA began once more to sell cotton. And as the supply became short, demand and the price paid for cotton increased."

Thus, Cowart's cotton warehouses are nearly empty now. Any more cotton to feed the growing demand for consumer clothing worldwide will have to come from the current crop still growing in the fields of North Texas, Oklahoma, Kansas and other cotton-producing areas in the US and foreign countries.

Encouraged by the demand for cotton, this spring, US farmers planted 19.2 percent more cotton acres than in 2009.

"We are going to need all of the predicted 1.6 million bales we are supposed to get," Cowart said.

As reported in Southwest Farm Press, a big US cotton crop could be a big help for cotton producers and for world consumers.

Joe Nicosia, president and CEO of Allenberg Cotton Co., Memphis, Tenn., a member of the Louis Dreyfus Group, speaking at a Cotton Roundtable in New York City, said, "We're going to need the cotton. Earlier estimates of US cotton at 15-16 million bales would have been a disaster for customers and consumers."

Nicosia projects US cotton production at 19.2 million bales on 10.9 million planted acres in 2010, based "on the potential for a record Texas crop and good growing conditions."

Cotton production last exceeded 19 million bales in 2006 when the US produced a 21.5 million-bale crop on 15.2 million acres.

World markets will be eager for a big US crop, Nicosia said. He believes there will be usage of less than 18 million bales, including exports of 14.3 million bales and US mill use of 3.5 million bales. At the end of the 2010-11 marketing year, he said, these projected figures would leave four million bales. This, he said, would provide a little larger supply of cotton than the 2010 2.7 million bale beginning stocks estimate.

Already, he said, US cotton export demand figures are moving higher with important sales activity during the past 10 weeks.

"US has sold 50 percent more cotton than it ever has during that time period," Nicosia said. "Already, this year, we are at 4.3 million bales. This means we are off to a tremendous start and we are seeing numbers we haven't seen in many years."

From now until world new crop cotton starts being harvested, the US will have very little competition for export sales, he said. Every country in the world is sold out of cotton, he said. He believes the US will continue to build its' export base and "have a great deal of sales."



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