Cotton prices up
Published 8:50 am Friday, February 18, 2011
CAPRON—Even with cotton prices at a modern-day high, Capron farmer Cliff Fox isn’t counting on his crop to make up for last summer’s drought.
“We’re steadily getting bombarded with higher costs for fertilizer, fuel, chemicals and land rent,” said Fox, who co-owns Foxhill Farms with his brother, Clarke. “Everyone wants to get a piece of the action.”
That’s not to say Cliff Fox won’t plant more cotton this spring, just like other farmers in Virginia are expected to do.
The state Department of Agriculture and Consumer Services said Thursday that cotton acreage is expected to increase by nearly 27 percent in 2011, from 82,250 acres in 2010 to an estimated 105,000 acres.
“In 2010, cotton prices moved higher, but with limited rainfall in Virginia, our yields were low,” said VDACS Commissioner Matthew J. Lohr. “Prices right now are the highest they’ve been in years, and that has influenced farmers’ planting decisions. They can book some of their crop at a very good price, and weather permitting, even with higher fuel and fertilizer costs, they should be able to have a profitable crop year.”
Neil Clark, agent for Virginia Cooperative Extension in Southampton County, expects that some farmers will plant 70 to 75 percent of their fields with cotton. Other crops grown locally include corn, soybeans and peanuts.
“One thing that farmers did find out last year, even with the drought, is that cotton is fairly resilient,” Clark said. “Commodity prices can come and go rather quickly. Signs are cotton should stay up.”
In 2008, farmers got an average of 72 cents per pound for cotton, and in 2009, 61 cents per pound, he said. As of Jan. 31, it was getting $1.65 per pound for delivery this March, and $1.02 per pound for March 2012 delivery.
Lohr credits the resurgence of cotton acreage to several other factors in addition to record prices. They include the eradication of the cotton boll weevil, the dedicated research staff at the Tidewater Agricultural Research and Extension Center, and strong cotton exports.
Virginia exports cotton and cottonseed to Turkey, China, Indonesia, Korea, Vietnam, Hong Kong, Japan and other countries.
Lohr also credits funding for innovative research such as using cotton gin waste for packaging supplies, cotton chemical wipes that absorb liquid toxins in warfare, cotton oil-absorbing booms used in the Gulf oil spill clean-up, as well as making cottonseed for human consumption.
Cliff Fox said he plans to plant cotton on a little over 900 acres this year; last year he planted 800 acres.
“Our cotton didn’t take the hit that corn and soybeans (did), and with the price the way it is, we decided we would put in a little more cotton this year,” he said.
Windsor-area farmer Cecil Byrum planted about 1,100 acres on his 2,400-acre farm last year. This year, he’s considering 1,400 acres.
“For us, it’s the way the cards fell into the rotation and the prices are very high,” said Byrum, who has been growing cotton for nearly 20 years. “I mean, we’re in unchartered territory, looking at record prices since I’ve been raising cotton.”
He also remains cautious.
“In farming, everything is relative, but it’s a wonderful opportunity,” he said. “A few short years ago, cotton was in the 40s (cent per pound range). So I guess we’re on the high swing now.”
Michael Drake with Sandy Ridge Farms in Newsoms normally plants 350 acres of cotton on his 1,200-acre farm. This year, Drake’s considering 400 acres.
“It’s slightly more, but not excessively more due to the rotation,” he said. “I’m also a peanut farmer, and of course, the price (for cotton) is attractive. That’s probably the biggest reason. Cotton is a little more drought-resistant than other crops.”
Drake noted too the cost of production is up.
“Fertilizer is up and gasoline and fuel,” he said. “Tires for some equipment is up 30 percent.”
When it comes to finances, Drake has his farm on a five-year cycle.
“We will have one year that is extremely good, and we will have one year that’s extremely bad, and hopefully the other three will be in the norm,” he said. “You can save in a good year to prepay for the bad year, and the rest of the time, it’s just paying the bills.”