The weather is too hot even for cotton in many parts of the U.S., causing federal forecasters to cut their expectations for this year's crop. The U.S. Department of Agriculture now expects just 78% of the acres planted with cotton this spring to grow anything worth harvesting, down from 86% a month ago.
Cotton futures rose to their highest price of the year in response. It's not as bad as last year, when drought devastated the crop, and just 53% of the land planted with cotton was harvested. At about 88 cents a pound Friday, futures are about 16% lower than they were a year ago.
“Those dry conditions continue to persist and that’s weighing heavily on farmers’ intentions," said Lance Honig, chief of the USDA’s crops branch. "That’s why we see acreage back down this year.”
U.S. farmers planted about 11.3 million acres with cotton, down from 13.8 million last year.
Acreage is down more than 20% in several states, including Texas, Louisiana, Mississippi, Arkansas and California. Other crops that need less irrigation such as eggplant, grapes, and figs are being planted in record numbers as farmers adapt to a new climate reality. This can lead to market trading opportunities as financial experts use available, curated, data to adapt to opportunities in this new, drier, landscape.
Source: WSJ