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January 2013 Cotton Leader

January 1st, 2013

In the September 2012 edition of Cotton Leader we ran a story about how U.S. cotton producers and ginners strive to always provide contamination-free cotton to their customers. The story also talked about how changes in products, processes or machinery used to harvest or gin cotton should be evaluated for their propensity to allow contaminates into the fiber stream. With the addition of on-board module-building cotton harvesters, especially the round modules with the plastic wrap, cutting the wrap in the correct spot on the round module is paramount to prevent contamination. With major input and assistance from John Deere, a diagram illustrating where to cut the wrap was diagramed and posted on Cotton Incorporated's Web site, After further discussions between John Deere, Cotton Incorporated's Director of Agricultural and Environmental Research, Dr. Ed Barnes and the National Cotton Council's Vice President of Ginner Services, Harrison Ashley, a new diagram illustrating the correct cutting point on round modules has been designed. It can be viewed by logging on to and look under the News and Media tab.

The Cotton Board's Communications team will again be hosting a booth at this year's Mid-South Farm & Gin Show. The show will be held at the Cook Convention Center in Memphis, Tennessee, March 1st & 2nd. This year's booth will showcase Cotton's 24 Hour Runway Show, which will be taking place in South Beach, Florida. This 24 hour fashion show will feature one cotton outfit per minute starting at 7pm CST on March 1st and ends at 7pm CST on March 2nd. "We plan on having the event streamed live on TV monitors at the booth," says Bobby Skeen, Cotton Board Mid-South Regional Communication Manager. Visitors who stop by the booth will also be able to taste samples of the new flavored-infused cottonseed oils which are offered in several flavors including hot habanero and smoky chipotle. "Our booth will be located at numbers 1024 and 1025," adds Skeen. And, as always, The Cotton Board booth will be stocked with our always-popular lip-balm, so make sure you stop by.

Five outstanding researchers, Dr. Andrew Paterson, Dr. Jonathan Wendel, Mr. Jeremy Schmutz, Dr. Dan Peterson, and Dr. Dan Rokhsar, have been awarded the 2012 Cotton Biotechnology Award. The announcement was made at the recent Plant and Animal Genome Conference in San Diego. This diverse and talented team led the collaborative community effort to complete the first 'gold standard' Gossypium genome sequence. The gold standard Gossypiumraimondii genome sequence provides the reference blueprint that will revolutionize cotton genetic improvement in the next 5-10 years. This scientific breakthrough leverages new biology to put cotton on a trajectory to increase yields, fiber quality and the efficiency of inputs necessary to grow cotton. Dr. Kater Hake, Vice-President of Agricultural & Environmental Research at Cotton Incorporated, puts the relevance of this breakthrough research into context: "The majority of the 400 research projects funded by Cotton Incorporated each year focus on ways to maximize efficiencies of cotton crops in varied geographic regions, each facing varying issues. Essential to that goal is understanding cotton plant biology at its most fundamental level." This blueprint of the simplest cotton genome will provide cotton breeders a detailed road map of where desirable genetic traits are located. "This research will speed to market improved cotton varieties that address specific soil, weather and pest-related problems in the U.S. Cotton Belt and beyond," adds Hake. The Cotton Biotechnology Award, endowed by a gift from Dr. Norma Trolinder in 2000, has been presented to four previous researchers. Since there were five award recipients this year, Cotton Incorporated gifted supplemental funds to ensure each winner received an appropriate award.

Cotton Incorporated is set to host a series of basic and intermediate workshops addressing topics such as market-based strategies for how to manage price risk for the 2013 crop season and tactics for integrating crop and revenue insurance. The first Cotton Price Risk Management Seminar of 2013 will be held at The Peabody Hotel in Memphis, TN on February 13th. Topics of discussion for the seminar include: Why are options on cotton futures critical to your business? What can options do for you and how? Actionable hedging strategies based on various price scenarios. Dr. Carl Anderson and Dr. John Robinson will discuss when and how to use a variety of option strategies involving puts, calls and spreads. The seminar will begin at 8:30 am and will end at 5:30 pm. There is no fee to attend and lunch will be provided for all participants. To register, contact Kay Wreidt at Cotton Incorporated by phone 919-678-2271 or email kwriedt [at] cottoninc [dot] com. Space is limited so please register as soon as possible. More seminar dates and locations will be announced later in the year.

New York futures prices have drifted higher. Since November, values for the March contract have increased about ten cents/lb and are approaching 80 cents/lb. Movement in the A Index has been marginal, with values fluctuating between 82 and 87 cents/lb. Questions related to future price direction remain centered on the Chinese cotton policy. Since purchasing for the current crop year began in September, the Chinese reserve system has bought 5.8 million tons (26.6 million bales). This volume represents nearly 80% of the current estimate for China's 2012/13 harvest (33.5 million bales). With so much of this year's crop going to government warehouses, where it can be held indefinitely, a major source of uncertainty for the global cotton market has been how China would decide to supply its mills – through releases from reserves or through imports. Given the concentration of global supplies in China (50% of global ending stocks in 2012/13), whatever China decides will likely be the most important influence
on price direction in coming months. Nonetheless, there are several other factors that will also shape the price outlook. Prominent among these is cotton acreage. Since the summer, corn and soybean prices have been high relative to cotton prices. This suggests an important decline in world planted acreage for the 2013/14 crop year. Government guaranteed minimum prices could help maintain acres in China and India. Survey-based estimates regarding U.S. cotton acreage will be released at the National Cotton Council's Annual Meeting on Saturday, February 9th. The USDA will release preliminary figures for world acreage, production, and consumption at their Outlook Forum meeting held February 21-22.

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