As most of you may know, I usually try starting my yearly Publisher's Note with some profound quote. This year, there is a couple that come to mind. The first one is, "to everything there is a season." Some of us may initially think the verse is from the hit song of the mid-60s; but it is actually from Ecclesiastes. It is proverbial.
On pondering this verbiage, I think about the ups and downs of agriculture…cotton, in particular. My point is, it is cyclical, much like the production season itself.
While many of our producers had a very good year, the short-term outlook may seem daunting, which brings me to my second adage: "This, too, shall pass." The second quote has been attributed to King Solomon. Upon researching this quote, it translates to "all material conditions, positive or negative, are temporary." Perhaps this quote is where optimism was born. While we have some hurdles to cross, there are some short-term positives such as mill use stabilizing. While China imports have been declining for the last few years, the growth outside of China is predicted to offset the China loss. Yarn imports to China are on the rise.
Like most everything else, it comes down to supply and demand. Gary Adams, National Cotton Council economist, says we are dealing with "the hangover from $2 cotton." In our December issue of Cotton Farming, both cotton economists Carl Anderson and Don Shurley agree that it is not any great surprise that the price would drop and that acreage reduction would follow.
John Bass of the World Bank predicted that it would be three to five years before we see prices improve. His reasoning is that biotechnology, globally, has improved yields, thus increasing supply. As other countries become more populated, the shift of acreage to food products will help, and as other countries capitalize on higher prices for corn and soybeans, the increase in supply would, theoretically, drive prices down for those commodities.
After attending Cotton Council International's Sourcing USA Summit this past November, it is clear that American cotton is viewed as some of the finest in the world market. I am continually impressed with this organization's commitment and success in building our global cotton brand.
Cotton is truly one of the most traditional crops with a personality of its own. In looking at the cover of this issue, it evokes a sense of pride…something that comes from a rich heritage. I can't think of a cotton farmer where the operation has not been passed along from several previous generations.
What would happen if our farmers decided to get out of cotton production? Would other farmers take over? While I don't claim to be as wise as King Solomon, my suspicion is that they would. The land itself seems to require it as part of its ancestry.