Dunavant: U.S. Acres 8.8 to 9.5 million; Future Demand Lies With China
25 February 2008 William Dunavant III said in a speech at the U.S. Agriculture Department’s annual outlook conference that U.S. 2008 cotton plantings should be between 8.8 million and 9.5 million acres this year.
Dunavant, CEO of Dunavant Enterprises, said a robust rally in grains prices has prompted American cotton farmers to switch wholesale to grains like soybeans and wheat, according to a Reuters article.
The USDA had already forecast U.S. 2008 cotton plantings at a 25-year low of 9.5 million acres.
The cotton futures market in New York would need to see the new-crop December cotton contract rally further to 85 cents in order “to see acreage come back to cotton.”
Dunavant said the key in the years ahead will be China and India, the biggest consumer and the second biggest cotton producer, respectively, in the world.
He said China could lose 15% to 20% of its arable land and would need, along with India, to concentrate on food output in their increasingly affluent countries. “Then (their) need to import cotton will grow by a staggering amount in the next 10 years,” he concluded. “They’re consuming more chicken, more pork, more beef.”
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