Cotton Links

Profitable Pima

It’s Simple Economics For California Producers

By Brenda Carol

Cotton acreage has plummeted in California in recent years, but it’s still a viable crop for many producers, and the future is still optimistic on many fronts. The biggest question for a lot of cotton producers is “Pima or upland?”

That’s a tough one, but the pendulum certainly seems to be swinging toward Pima.

“Last year was the first year that Pima plantings exceeded upland plantings statewide,” says Earl Williams, president and chief executive officer of the California Cotton Ginners and Growers Association (CCGGA) in Fresno, Calif.

“There were 260,000 acres of Pima, which comprised 57.5 percent of the acreage, and 192,000 acres of upland cotton that made up the remaining 42.5 percent.”

One of the more amazing statistics about the swing from upland to Pima has been the relatively short time period in which it has occurred. The first commercial crop of Pima was planted in 1989 and totaled a mere 17,900 acres.

“Over the 19 years we’ve seen lots of ups and downs with the Pima acreage, but certainly over the last few years, the percentage of Pima acres in relation to the overall cotton acreage seems to be stabilizing while the percentage of upland acres continues to decline,” Williams says.

Significant Turnaround

For 2008, the overall estimated cotton acreage in California is 300,000 acres. Of that, 100,000 acres are expected to be planted to upland varieties – 33.5 percent of the market – while Pima is expected to make up 200,000 acres or 66.5 percent of cotton plantings statewide.

“I think one can obviously see from these trends that short staple cottons are declining while Pima seems to be holding a more steady line,” Williams says.

Part of the con-undrum can be attributed to the skyrocketing price of grains, such as wheat and corn, mixed in with the uncertainty about the water situation in the state. Less risky crop choices, higher prices in other commodities and the uncertainty regarding the Farm Bill are taking a toll on California’s cotton acreage.

“We do think, hopefully, that many of the uncertainties could be answered by the ‘09 planting season which we believe could bring about a rebound of sorts in cotton plantings,” Williams says. “It’s not going to rebound back to a million acres like we had in California’s heyday, but we believe it could go from the estimated 300,000 acres in ‘08 to something in the 350,000-450,000 acre range in ‘09.”

Weighing The Risks

In the northern areas of California’s cotton acreage, some producers have opted to plant upland rather than Pima due to a weakening price differential situation.

“We have less Pima acreage this year than last,” says Gary Robertson, Pest Control Advisor with Helena in Merced, Calif.

“When Pima is looking like $1.05 a pound and Acala is looking like 80 cents a pound, a lot of growers will switch back to Acala due to the risk of growing Pima this far north. Cotton acreage overall in the Los Banos/Dos Palos area is probably down 30 percent as compared to just three years ago.”

So far the situation in terms of production is looking fairly normal as the season begins.

“We typically need to get cotton planted by the first to the tenth of April,” Robertson says. “We’ve done that this year. It’s out of the ground and growing. It looks like the lygus situation this year may be confined to resident populations from adjacent fields rather than the influx from the foothills.

“That’s good news for growers. The weeds in the foothills dried up early, so we don’t anticipate those populations creating a big problem.”

Price may have been a factor in some producers choosing uplands over Pima varieties, but it doesn’t seem to have made much of a difference in the overall scheme of things, according to Williams.

“There has been some action on the price side with futures going crazy upward on the uplands,” Williams says. “I heard a few folks were able to lock in some pretty high floors (mid 90s) during that run, but that has subsided because of the speculators influencing the market and little relativity to what the real supply and demand picture reveals.”

Some Clear Advantages

Still, the pros in many ways outweigh the cons. On the negative side there are definitely higher costs to grow a bale of cotton in California, and trade policies aren’t all that friendly. On the other hand, California has a lot of advantages, including reliability of supply, consistent high quality lint and an established infrastructure. Pima or uplands are good rotations that fit well into many producers’ cropping patterns and strategies.

With new varieties and technologies in the pipeline, the future is fairly bright, according to Williams. Marketing will continue to be a key.

“Most important in my mind when it comes to the future of Pima in California, is Supima, which is an outstanding grower-owned and supported advertising and promotional organization,” Williams says.

“Supima will, in my estimation, continue to establish American Pima cotton in the marketplace and separate us from all the other Pima cottons in the world.”

Pima Goes Global

California farmers produce more than 90 percent of U.S. Pima cotton. Supima has made impressive inroads into the worldwide textile market by aggressively branding and promoting its product. In recent years, industry representatives have courted the high-end garment manufacturers by participating in some of the most prestigious textile and fashion shows in the world, including Paris and New York’s highly touted annual events.

“We can generate all sorts of brochures and advertising, but it’s that moment when someone actually holds a Supima fabric in their hands, touches it and feels the quality, that Supima becomes a real selling point,” says Jess Curlee, president of the Supima Association in Phoenix, Ariz.

“The competition is fierce among fibers, even if you’re just talking about cotton. For example, there’s a perception among retailers that Egyptian cotton is consistently very high quality, when the truth is it’s all over the board. What retailers don’t realize sometimes is that Supima cotton far exceeds that standard and does it on a consistent basis. That’s the message we are trying to convey, and we have made tremendous progress in doing so.”

No one knows what the future will hold for California Pima producers, but one thing is certain – the quality of the lint is a pretty tough contender against any others – here or abroad.

Contact Brenda Carol at (805) 226-9896 or brenda@brendacarol.net.

Gins Reflect Changing Industry

Gin capacity has tracked the trend toward a greater percentage of Pima cotton in California. Last year, of the 57 gins operating in California, seven were combination gins with the capability to roller or saw gin in the same facility.

“We actually had 49 separate gin facilities operating last year, of which 24 were or had roller ginning capacities,” Williams says. “So those 24 facilities ginned the 765,000 bales of Pima produced in California in ‘07 plus the 138,000 bales of upland cotton roller ginned in ‘07.”

Roller ginning has been a more costly process in the past due to slower speeds as compared to saw ginning, but higher speed retrofits as well as new stand technology has greatly increased processing speed levels.

This new technology is helping bring the per-bale cost down to a more acceptable level for the industry. Adjustments will continue in gin numbers with several more saw gins expected to close over the next year or so, according to Williams.


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