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January 2014 Cotton Leader

January 1st, 2014

The Cotton Board will again be hosting a booth at the 2014 Mid-South Farm and Gin Show on February 28 and March 1 at the Cook Convention Center in Memphis, Tennessee - and we want your used denim! The Cotton Board’s Regional Communications Managers will hold a Blue Jeans Go Green denim drive where each piece of donated denim earns a chance to win a $300 gift certificate from Cabela’s. “Cabela’s adopted an apparel finishing technology developed by Cotton Incorporated called ‘STORM COTTON’ and have applied the technology to a line of camoflagued hoodies,” explains Bobby Skeen, Mid-South Regional Communications Manager for The Cotton Board. The booth will include bins where showgoers can drop off their donated denim items and enter for their chances to win. The denim will be converted into UltraTouch™ insulation by Bonded Logic, a leading manufacturer of natural fiber insulation. The insulation will then be provided to building organizations working in communities in need - often in area affected by natural disasters. The Blue Jeans Go Green denim drive recently collected its one-millionth piece of used denim. “In addition to bringing your denim, make sure and get one of our always-popular lip balm,” adds Skeen.

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 2014 crop season and tactics for integrating crop and revenue insurance. The first Cotton Price Risk Management Seminar of 2014 will be held at The Peabody Hotel in Memphis, TN on February 11th. 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? ; and 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 5:00 pm. There is no fee to attend and lunch will be provided for all participants. To register, contact Lynda Keysat Cotton Incorporated by phone 919-678-2269 or email lkeys [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.

Agriculture Secretary Tom Vilsack recently announced the appointment of 17 members and 17 alternates to The Cotton Board. The Cotton Board is appointed by the Secretary to oversee the Cotton Research and Promotion Program. All appointees will serve 3-year terms beginning Jan 1, 2014, and ending Dec. 31, 2016. The Cotton Board Chairman, Gary Ross, an importer from Yardley, Pennsylvania was pleased with Secretary Vilsack’s appointments saying, “The re-appointed Members and Alternates bring experience and exceptional knowledge of the cotton industry to The Cotton Board. I also look forward to working with the new appointees, who will bring a fresh perspective to our Board’s activities.“ The re-appointed members are: Walter L. Corcoran of Eufaula, Ala.; David J. DeFelix of Campbellton, Fla.; James L. Webb of Leary, Ga.; Suzanne R. Drouhard from Danville, Kan.; and Dwight W. Menefee from Lake Arthur, N.M. Also reappointed are Arthur W. James, Jr. of Sumter, S.C.; Willie L. German, Jr. of Somerville, Tenn.; Madison Farmer of Lamesa, Texas; Lance V. Everett of Stony Creek, Va.; Gary E. Ross from Yardley, Pa.; Michael D. Wallace from Bentonville, Ark.; Flora J. Wong from Mercer Island, Wash.; Peter M. McGrath from Dallas, Texas; Arlene M. Eastwood from Neptune, N.J.; and A. Mark Neuman from Champaign, Ill. The re-appointed alternate members are: Timothy J. Mullek of Robertsdale, Ala.; Alan J. Edwards of Jay, Fla.; Thomas L. Lahey of Moscow, Kan.; Jackie L. Joy of Antesia, N.M.; and Clint D. Abernathy of Altus, Okla. Francis G. Darby from Chester, S.C.; Debra R. Barrett from Edroy, Texas; MarvinL. Everett from Capron, Va.; Helga L. Ying from Piedmont, Calif.; Tara E. Hoffmann from New York, N.Y.; and, Kristine T. Arabia from Hudson, Ohio have also been reappointed as alternates. New to the board are members Kim M. Mayberry-Holifield of Kennett, Mo. and Jess M. Nichols of Altus, Okla.; and alternates Benjamin R.Grimsley of Weston, Ga.; John H. Hunter of Essex, Mo.; Catherine S. Via, Bells, Tenn.; Sarah M. Gilligan of San Francisco, Calif.; Joe D. Long of Hollywood, Fla.; and, James C. Self III, of Greenwood, S.C. Secretary Vilsack also selected importer Stefanie M. Rotta of Elkins Park, Pa. as an alternate member whose term expires on Dec. 31, 2014.

Louisiana cotton producer and Cotton Board Member George LaCour was named 2014 Cotton Farmer of the Year at the 2014 Conservation Systems Cotton & Rice Conference in Tunica, Mississippi this month. Cotton Incorporated continued their “Title Sponsorship” role along with the U.S. Rice Producers Association and the United Soybean Board. “The Cotton Board’s Bobby Skeen suggested LaCour be considered for the award and after learning more about George, his farm, his environmental stewardship and industry leadership history, it was an easy choice,”says, John LaRose, Publisher of Mid-America Farm Publications and conference host.

Economic update
Outside of China, global cotton prices increased slightly last month. After drifting 3 cents/lb higher in the first half of December, the New York March futures contract has held to values between 83 and 85 cents/lb in recent trading. The A Index also increased about 3 cents/lb last month, climbing from levels near 87 cents/lb to those approaching 90 cents/lb. In both international (146 cents/lb) and domestic terms (19,510 RMB/ton), the CC Index (Chinese mill-delivered price) was virtually unchanged last month. This month’s USDA report featured an increase in world roduction (+978,000 bales to 117.8 million), a slight decrease in global mill-use (-182,000 bales to 109.5 million), and an increase in world ending stocks (+1.2 million bales to 97.6 million). One source of uncertainty is the production and consumption outlook for 2014/15. Next month, a series of forecasts will be released that willaddress questions elated to supply and demand. The National Cotton Council (NCC) will publish estimates for 2014/15 U.S. cotton acreage at their annual meeting on February 8th. Expectations are that U.S. cotton acreage will be higher next crop year. If West Texas receives more rainfall than they have gotten the past two crop years, U.S.production could increase by a million bales or more. The USDA will release a preliminary set of global estimates and a partial set of country-level statistics at their Outlook meeting February 21st. Although supply and demand figures are relevant for the global price outlook, the most important information for the cotton market in coming months will likely be any announcement from the Chinese government that details reforms to cotton policy. Any details related to Chinese import demand in coming crop years can be expected to heavily influence price movement. Lower levels of Chinese imports should imply higher stocks in exporting countries and downward pressure cotton prices around the world.

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