Saturday, February 21, 1998

Mill use of cotton pegged at more than 11 million bales

By J.T. Smith / Abilene Reporter-News

USDA has estimated mill use of cotton by textile mills in this country at 11.5 million bales.

This represents an increase of 100,000 bales from its previous estimate of domestic use.

Production remains steady at 18.98 million bales estimated from the U.S. crop just harvested. Exports are projected at 7.3 million bales.

Ending stocks are expected to be near 4.2 million next August when the new marketing year begins.

The National Cotton Council is projecting a crop for the upcoming 1998-99 of 16.1 million bales. That's based on 11.52 million acres of cotton expected to be planted in the Cotton Belt this season.

This farm writer visited with seasoned grower and cotton leader Herman A. Propst of Anson during the Rolling Plains Cotton Growers annual meeting last week in Abilene.

Propst pointed out that there are some real uncertainties when it comes to guessing cotton acreage.

The crop situation in the Rio Grande Valley is worth watching the rest of this month and in early March, Propst said. Growers there are the first in the United States to plant their cotton.

How much land in the deep South Texas finally winds up in corn (and grain sorghum) -- and how much in cotton -- will have a lot to say about the ultimate Texas acreage, Propst noted.

It will be interesting to watch the amount of grain sorghum and corn that gets planted along the Coastal Bend as well.

Currently, Texas cotton acreage is estimated at 4.9 million acres -- down roughly 10 percent from 5.5 million acres in 1997. That's the estimate from NCC's annual Prospective U.S. Cotton Plantings survey.

Propst is a former president and board chairman of the National Cotton Council, as well as a past president and chairman of Cotton Council International, the NCC's overseas arm. Propst also was chairman of the key Producer Steering Committee of the NCC.

Looking deeper into crystal ball

Obviously, exact cotton production is impossible to predict. But the NCC has an excellent track record of being well within a high and low range.

While roughly 16 million bales is the estimate, NCC puts the upcoming crop within a range of 14.4 million to 17 million bales.

But -- for the sake of projection -- accept the 16.1 million-bale estimate for now.

If that's on target, you could tack on that 4.2 million beginning carryover of Aug. 1 and come up with a total U.S. suply of 20.3 million bales.

If domestic mill use next season again reaches 11.5 million bales (the same as currently forecast this season), and exports amount of 6.2 million bales, that would mean at total offtake of 17.7 million bales.

Subtracted that offtake from next season's projected total supply of 20.3 million bales, and you would come up with only 2.6 million bales of carryover on Aug. 1, 1999 for 1998-99 ending stocks.

With a few months left at that time before Year 2000, that supply would seem pretty manageable, at least for the U.S. part.

Texas cattle on feed up 10 percent

Cattle and calves on feed are up 10 percent from last year at this time.

Texas feedlots with a capacity of 1,000 head of cattle or more showed a total of 2.76 million cattle and calves on feed as of February.

That's up 10 percent from February 1997, said the Texas Agricultural Statistics Service.

But the estimate was down 3 percent from the January level this year.

Cattle and calves on feed for the slaughter market in United States feedlots were at 10.7 million head as of February.

That was up 4 percent from a year earlier.

Will Clinton get Fast-Track trade powers?

During this year's State of the Union address, President Clinton again asked Congress to pass legislation renewing fast-track trade negotiating authority for the White House.

Underscoring the difficulties in such legislation, Clinton made no reference to when he would seek the vote.

While he said the Administration will "forge new partnerships with Latin America, Asia and Europe" -- he did not say how formal trade agreements with countries such as Chile could be negotiated if Congress does not grant him the fast track.

Key Democrats are withholding power support for fast track until President Clinton adds language impsoing greater labor and environmental safeguards on foreign countries.

With fast track, the U.S. Congress must vote either thumbs up or down on trade deals negotiated by the White House without adding changes.

A deal is a deal.