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Australian cotton production for 2007/08 forecast at 0.7mn bales

May '07
The effects of long running drought, which began in 2002/03, look set to continue for the foreseeable future despite the prospect of rain. Dry conditions have now seriously affected the irrigation catchment over the longer term and have seen dam levels fall again after a period of steady recovery.

ABARE recently published water storage data showing current water storages at historically low levels. In the state of Queensland, which produces over one third of Australia's cotton, dam levels range from 25 percent capacity down to 4 percent capacity.

In the state of New South Wales (NSW), which produces the remainder of Australia's cotton, dam levels range from 25 percent to just three percent. Furthermore, the landscape surrounding the catchment areas is generally dry, suggesting that good rains are required before increased inflows can commence.

In a recent statement, the Snowy Hydro Scheme (located in Southern NSW and northern Victoria), which generates hydro-electricity as well as providing irrigation water for the Murrumbidgee and Lachlan river irrigation areas, announced that it would begin shutting down hydro-electric generators as the scheme begins to run out of water toward the end of May 2007.

The past 11 months have seen inflows fall to 30 percent of the ten-year average and rainfall minimums fall to the lowest for 101 years. Although this irrigation scheme accounts for only a small share of Australia's total cotton production, its forecast closure is a measure of the severity of the drought in eastern Australia at present.

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