NICOLA BELL, The Weekly Times
COTTON prices have started the year more strongly than anticipated.
Cotton Australia chief executive Adam Kay said the cotton price was at $535 to $540 a bale this week.
And while these are historically high prices, Mr Kay said they were down on the $550 to $560 of a few weeks ago.
Rabobank commodity analyst Georgia Twomey said prices were higher than anticipated, but were expected to be “fairly volatile” for the remainder of the season.
“A near-record speculator net long position and a lot of mills with no fixed price on contracts have helped drive prices up,” Ms Twomey said.
She said the stronger Australian dollar had also played a part in the price volatility.
However, prices were expected to comfortably stay above $500 a bale for the picking period.
While picking the cotton crop has only just started at Emerald in Queensland, Ms Twomey said they were predicting another large area of cotton would be planted in 2018-19 due to the high prices.
“I was in Emerald last week and the early picking crops are really positive, with strong yields,” Ms Twomey said.
In the southern areas there are still a couple of months of crop development and weather risk, however Ms Twomey said the feedback in the southern areas was that crops had had a good start to the season and good establishment.
Cotton Australia is expecting a total of 4.3 million bales of cotton to be picked this season, which will come from 370,000ha of irrigated cotton and 150,000ha of dryland cotton.
“There are some areas that have had long, hot summers and low rainfall and about 30,000ha damaged by spray drift, but lifts in yield in other areas, and we have factored all of that in to the estimates,” Mr Kay said.
He said across most areas growers were hoping for average to above average yields, particularly for irrigated crops.
He said dryland crops in northern NSW had struggled due to patchy rain.
“The price is good, the potential yields are looking good and in general the bulk of the crop looks good,” Mr Kay said.