Cotton Links


TCGA Meeting To Focus On
New Challenges


By Tommy Horton

Texas cotton ginners face a different challenge each year, but as they prepare for the 2009 season, the obstacles seem a bit larger than usual.

Cotton prices are low. Input costs continue to fluctuate. Corn and soybean crops have taken acreage away from cotton. And then there’s the global economic recession.

For those reasons, it’s understandable that the theme of this year’s Texas Cotton Ginners Association Annual Meeting and Trade Show will be “Meeting The Challenges.”

No matter what sector of the cotton industry is examined, the task facing everyone – including ginners – is simple. How can U.S. cotton overcome the current economic crisis and focus on a quick recovery?

That will be the major topic of discussion when TCGA members meet in Lubbock, Texas, on April 2-3 at the Lubbock Civic Center.

“Given the current state of the world economy, I think our theme is pretty relevant,” says Tony Williams, TCGA executive vice president.

“When you combine the cutback in consumer spending with the downturn in the textile market, it affects all of us in cotton.”

Optimism Remains High

Still, given all of those economic problems, Williams remains optimistic that cotton acreage can remain relatively stable in Texas in 2009. He also is confident that the ginning sector can deal with a smaller cotton crop and stay profitable.

It wasn’t necessarily economic problems that caused the ‘08 Texas crop to decrease to 4.6 million bales. Instead it was harsh weather conditions resulting in untimely rainfall, drought conditions and cooler temperatures in the fall.

Although the ‘08 crop wound up being almost four million bales lower than ‘07 production, much of the crop loss was in dryland cotton.

“There was a time when a 4.6-million-bale cotton crop was pretty big in Texas,” says Williams. “So, I think we need to keep things in perspective. After having big crops for several years, our ginners have put some money in the bank, and I think they can deal with a smaller crop.”

While it might not be noticeable to the public, Williams says ginners have learned important lessons in Texas in the last few years. They know how to manage labor costs after processing huge crops – especially in 2007 when cotton production hit 8.1 million bales.

He says gin managers also learned how to keep their labor force efficient in the middle of long seasons that often stretched out over several months.

“Our ginners know that it’s important to give their workers some time off and not go non-stop for longer periods of time,” says Williams. “That is definitely a plus for everybody.”

Value Of Export Markets

As for market forces that represent challenges to Texas, ginners know that their state is crucial in helping the United States move cotton to overseas mills. That fact is made more obvious when half of the cotton planted in the United States is in Texas. And, for several years, three-fourths of U.S. cotton is being shipped to overseas mill customers.

Those export markets, according to Williams, may improve if China and India, for example, reduce cotton acreage in favor of grain crop production. That could create new demand opportunities for U.S. cotton.

“If this kind of scenario were to occur, it could create an environment that could increase the price of U.S. cotton,” says Williams. “That would be welcome news if it happened.”

As for this year’s TCGA trade show, Williams is expecting the event to “sell out” with the maximum number of vendors. Even though some companies may cut back on business expenses and not participate, Williams still thinks all available space will be sold for the show.

“Despite the economic challenges our industry faces, I hope the mood will be positive when everybody arrives in Lubbock,” he says.

Contact Tommy Horton at (901) 767-4020 or thorton@onegrower.com.

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