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Cotton-tastrophe Averted? (Nathan Reed Commentary)

4 min read

Cotton has been shrinking in Arkansas and around the country, and hot water has nothing to do with it. 

In 2015, U.S. cotton production declined by some 3.4 million bales from the previous year. Cotton prices hit a six-year low in 2015 and, according to data from the U.S. Department of Agriculture, farmers planted the fewest acres of cotton since 1983. 

In Arkansas the downward trend in cotton has been going on for most of the last decade. In 2005, farmers in the state planted just more than 1 million acres, while in 2015, the total was down to around 200,000 acres. 

As a cotton producer and the son and grandson of cotton producers, I’ve witnessed this decline firsthand and I know the challenges Arkansas cotton growers face. There are a number of factors in play, from consumer demand problems to overabundance, weather and the expense of growing the crop. 

Nevertheless, I’m planting substantially more cotton in 2016 than 2015, and, while “King Cotton” may no longer hold its throne, early indications for 2016 show that the crop still has a seat at the Arkansas agriculture “Round Table.”

The National Cotton Council’s Early Season Planting Intentions Survey, which was released in early February, showed that growers in the mid-south (which includes Arkansas, Missouri, Louisiana, Mississippi and Tennessee) intend to plant 1.2 million acres, an increase of almost 25 percent over 2015. According to the survey, respondents in Arkansas, Louisiana and Mississippi indicated a reduction in planting of wheat, soybeans and “other crops” in favor of cotton.

The mid-south as a whole is planting substantially more cotton, because cotton produced in the region – commonly referred to as Memphis East cotton – is selling for a premium over cotton produced in other parts of the country. In other words, our cotton is of a very high quality, and that still means something in the marketplace.

Another factor in a potential 2016 uptick is a shift in market demand for other crops. For example, in 2015 there was a major increase in demand for sorghum by Chinese buyers, which resulted in a premium for grain sorghum when the price of all other commodities grown in the area were depressed. This inspired many cotton farmers in Arkansas to experiment with sorghum, but the Chinese appetite for grain sorghum has been filled and the premiums have disappeared.

This, combined with the recent emergence of the sugarcane aphid pest in grain sorghum, have tempered enthusiasm for the crop in the Delta. I am personally reducing sorghum acreage substantially and I know many others doing the same.

Another piece of good news in the Cotton Council report is that U.S. textile mills are expected to consume 3.6 million bales of cotton in the current marketing year, up 25,000 bales from 2015 and marketing the fourth consecutive year of increased consumption. 

While this is all positive, numerous challenges remain for cotton producers in 2016. In fact, some would say that there’s more stress in the cotton production sector now than there has been in years. What seems to be a major issue now is the higher cost of production — seed costs are high, equipment costs are high and land rents are taking time to readjust.

Heavy regulations and unpredictable weather patterns have also played a role in the cotton rollercoaster and this, turn, is leading to banking challenges for some farmers. Many growers are bringing carry-over debt into the season, making it difficult for some to refinance. 

There is a unique infrastructure surrounding cotton that is absent for other commodities — from gins and warehouses to merchants and seed processors — and the cost of necessary equipment and services can be an insurmountable obstacle without adequate funding.

But while cotton growers remain in a survival mode, we continue to plant and believe that things will improve in the years to come. We know that long-term outlooks could improve if the cotton industry does more to compete with the growing man-made fiber industry. 

“It’s yoga pants versus blue jeans.” That’s how my friend Craig Brown, vice president of producer affairs with the National Cotton Council, describes the ongoing battle for consumers in the world of fibers. It’s a colorful and reasonably accurate way to illustrate the erosion of cotton’s share of the market. 

With the downturn, cotton is now more competitively priced compared with man-made fibers, but a gap remains. We need new technologies and more innovation. Most importantly though, we need to get consumers to ask for cotton.

My greatest hope is that consumers realize that cotton is a natural, environmentally friendly, sustainable product that is produced by small, family owned businesses in America. I hope that, in 2016, they will look at the tags of clothes that they are buying and begin demanding 100 percent cotton.


A fourth generation farmer, Nathan Reed raises cotton, corn, soybeans and grain sorghum on more than 6,000 acres in Lee County. He serves on the board of the Lee County Farm Bureau and the National Cotton Council of America, and he is the owner and operator of Nathan B. Reed Farms, a farming equipment ownership entity, and Eldon Reed Farms, Inc., a row crop farming corporation. He and his wife, Kristin, were named 2014 Arkansas Farm Family of the Year.
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