Is The World Market Ready To Pay $1.50 A Pound For Pima Cotton?

Our contacts in California keep hearing projections that shortages in extra long-staple (ELS) cotton could push the price for the state's Pima cotton to $1.50 a pound this year. The state's ELS acreage would dramatically increase in that case, provided enough irrigation water is available to support the acres. That point is still in question, though. A couple of our contacts -- mainly professional crop advisers (PCAs) -- have said their cotton acreage could likely go up by 40% to 60%.

But running in the background is an argument that we're moving into a low-demand period for ELS fiber, notes Robert Antoshak, President of FCStone Fibers & Textiles.

In an article posted on his blog, Antoshak notes:

"Some may say this shift in favor of LS varieties is due to a lowering of cotton standards around the world, as textile companies look for alternative sources of supply that are offered at a cheaper price to ELS cotton. Yet others say that in reality overall quality of average crops has improved thanks to the expansion of LS cotton at the expense of traditional upland cotton and despite declines noted in ELS varieties around the world."

In his blog, Antoshak recently reported on a study about ELS demand, looking at acreage trends and the attitudes of buyers, millers and companies that use cotton in their products.

Here's a link to his posting.

- Owen Taylor