A big U.S. cotton crop could be a much needed salve for U.S. producers and consumers around the world, according to Joe Nicosia, Allenberg president and CEO.
“We’re going to need the cotton,” said Nicosia, speaking at the Cotton Roundtable in New York City. “Earlier estimates of U.S. production at 15 million bales to 16 million bales would have been a disaster for customers and consumers.”
Nicosia projects U.S. 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 so far across the rest of the Cotton Belt. Cotton production last exceeded 19 million bales in 2006, when the United States produced a 21.5 million-bale crop on 15.2 million planted acres.
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The world will be thirsty for a big U.S. crop, Nicosia says. He projects usage at just under 18 million bales, including exports of 14.3 million bales and domestic mill use of 3.5 million bales. That would leave ending stocks for 2010-11 at 4 million bales, providing a bit larger cushion than this year’s 2.7 million-bale beginning stocks estimate.
U.S. export demand figures are already moving higher with significant sales activity over the last 10 weeks, Nicosia said. “The United States has sold over 50 percent more cotton than it ever has during that time period. This year already, we’re at 4.3 million bales. What that says is our export potential is off to a tremendous start. We’re seeing numbers that we haven’t seen in many years.”
Nicosia says that from now until the world new crop starts coming out of fields, the United States “faces very limited competition for export sales. Literally, every country in the world is sold out. So we’re going to continue to be able to build an export base and put on a great deal of sales.”