Released Dec. 13, 2007

MISSISSIPPI STATE, Miss. -- High production cost and better marketing opportunities for grain crops have ended cotton’s perennial run in the top three of Mississippi’s agricultural commodities.

Cotton’s value in 2007 is almost $415 million, which places the commodity behind soybeans ($511 million) and corn ($438 million) in the row-crop category. It is fifth in the overall ranking of agricultural commodities, according to figures released by John Anderson, agricultural economist with Mississippi State University’s Extension Service.

“Historically, cotton ranked first in row-crop value and has placed first, second or third in the comparison of overall farm commodity values,” he said. “This change marks a dramatic shift in the landscape for Mississippi agriculture.”

In its heyday, cotton was king in Mississippi. Agricultural experts recorded 1930 as a banner year for the crop as farmers planted more than 4.1 million acres of cotton in the state.

The first sign of a new order occurred with the release of planting intentions in April. Mississippi farmers typically plant between 1 million and 1.2 million acres of cotton each year. When planting was completed, final figures from the U.S. Department of Agriculture put the crop at 660,000 acres, a 46 percent lower than in recent years.

"Two economic factors played a big role in the acreage drop,” Anderson said. “Strong prices in corn and soybean markets convinced farmers to shift acreage that normally would have gone into cotton. Higher fertilizer and fuel costs discouraged many farmers from committing more resources to a crop that is already one of the most expensive to produce."

A significant amount of cotton acreage was diverted into the production of corn and wheat. Acreage for corn doubled from 340,000 in 2006 to more than 960,000 in 2007. Wheat acreage quadrupled from 85,000 in 2006 to more than 370,000 in 2007.

Cotton experienced a complicated production year because of extremes in temperature, moisture and field conditions, said Extension cotton specialist Darrin Dodds. A freeze at Easter slowed some planting, and ill-timed rain with cloudy skies in July caused boll shed in many fields. August turned miserably hot and dry, which hurt overall plant health.

Despite the setbacks, the crop as a whole produced the second-highest yield on record, Dodds said. Farmers averaged 975 pounds of lint per acre, surpassed only by the 1,024 pounds per acre they averaged in 2004.

Still, cotton was not able to recover its elite-value status, said Extension agricultural economist Steve Martin of the Delta Research and Extension Center in Stoneville.

“Market prices for cotton are marginally higher than they were in the past few years, but they are still not high enough to cover the cost of production or to be competitive with other crops,” he said.

Cotton may have lost its luster, but it remains important to Mississippi agriculture, Martin said. The absence of the crop would have a dire impact because cotton has a high multiplier effect on the state’s economy.

“More people are employed and more economic activity is generated by cotton production than from any other row crop,” he said. “Rural economies will eventually see reduced economic activity if cotton acreage is lost without anything else to replace it.”

In the meantime, forecasters predict that cotton will have a hard time regaining acreage lost to other crops as production costs are expected to climb again in 2008, Dodds said. High futures prices for soybeans will make it hard for cotton farmers to return to their traditional crop favorite. However, if soybean seed is in short supply, farmers who can’t obtain seed might have no choice but to plant cotton once again.

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http://msucares.com/news/print/agnews/an07/071213cotton.html

Contacts: Dr. Darrin Dodds, (662) 325-4072

Dr. John Anderson, (662) 325-1788