A well-known U.S. analysis agency believes that although ICE futures fell sharply last week, the December ICE futures contract in February still rose 8.55% to 84.33 cents/pound, which not only made cotton the best performance in February The most eye-catching agricultural product has also kept the income from cotton cultivation at an all-time high.
In February, the Chicago November soybean contract in the United States rose by 7.06%, while corn rose by only 2.2%. From the perspective of technical graphics, neither soybeans nor corn have risen to new highs in this round of rebound like cotton, but are only close to previous highs. Judging from these data, the US cotton planting area in 2021 may be higher than the 12 million acres predicted by the USDA Outlook Forum, reaching 12.5-13.2 million acres. This means that US cotton production will increase significantly.
Based on 13 million acres and a 10% abandonment rate, the US cotton harvest area this year is expected to be 11.7 million acres. Based on a yield of 850 pounds per acre, U.S. cotton production will reach 20.7 million bales, an increase of 5 million bales from this year’s 14.95 million bales. Of course, the rejection rate in western Texas is a big uncertainty. It has fluctuated significantly between 15-30% in recent years, which has a decisive impact on US cotton production.
Judging from current demand, the United States can easily export 15.5-16 million bales of cotton in 2021/22. In other words, only when the output reaches 18-19 million bales will the US cotton output appear to be on the high side, putting pressure on the market. As global cotton demand continues to increase, US cotton exports should be able to reach 16 million bales. </p
