With all eyes on USDA’s 2023 prospective planting report to be released on Friday, March 31, 2023, a general sentiment among stakeholders is that cotton producers in the United States are expected to plant less than what was planted in 2022.
In my interactions on March 28, 2023 with producers and economists at the 66th Annual meeting of the Plains Cotton Growers, Inc in Lubbock, Texas, cotton planting decisions will be predominantly determined by rain and the weather during the planting season.
As cotton is based on discretionary spending by consumers, global and regional economies also play their roles in how the landscape will shift.
China remains a dominant player in the cotton and textile marketplace. With not much transparency in the data coming out of China, it is hard to judge the actual situation about spending revival there.
Geopolitical situation, market volatility, weather in Texas, and economy will all have their respective roles to play in the global cotton situation, as pointed out by Martin Stoerner, President of Lubbock-based Plains Cotton Growers, Inc.
With inflation in the United States still lingering at 5%, interest rate hikes may be expected which may tighten spending, influencing retail sales and hence the demand of non-essential commodities.
Economy and weather are key influencers this season and may be visible in the planting intention report to be published this Friday by the United States Department of Agriculture.
