Lower yield & subdued prices haunt Aussie cotton farmers

15 Sep '06

2 min read

Even as the United States Department of Agriculture has predicted higher demand and lower cotton output from around the world over the next 12 months, Australian cotton crop faces another tough season, confirming lower yield.

Recently, Frank Rijsberman, Director-General, International Water Management Institute was reported in the media stating that there has been a dramatic drop in water availability due to past five years of continuous drought.

He went on to state that Queensland Cotton is expecting an Australian crop of 1.6 and 2 million bales, which is significantly down on last season's 2.6 million.

Speaking exclusively to Fibre2fashion.com, David Brophy, Cotton Trader at ECOM Commodities Pty Ltd, Australia about the cotton situation says, "Australian cotton faces another tough season, with anticipation of a significantly reduced crop and depleted prices for growers."

"Having spent the most recent two years with the false impression that the drought had broken, another extremely dry year has resulted in low water availability. There is still just over a month in which a miracle may occur, but at this stage acreage of around 170,000 hectares is possible."

He adds that “Prices for a bale of cotton are barely higher than the cost of production, reflecting low futures prices and a strong Australian dollar. Australian cotton crop husbandry is considered the world's best, reflected in the significantly higher yields than other growths. Especially in times of low prices and escalating input costs, yield is absolutely vital.”

“Quality for Australian cotton continues to be exceptional and mill markets will continue to demand machine picked, contamination free, long and strong high grades. The challenge is to keep the micronaire in the premium range of 3.8 - 4.5. With origins such as West Africa, Uzbekistan and India flooding the market with cheap SM 1-1/8", there is great incentive to elevate the benchmark for high grades, towards a longer staple and higher GPT," he rounds off.

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