U.S. cotton acreage is expected to decrease in 2025 as falling prices and waning demand for the natural fiber might push farmers to scale back, analysts said.

Cotton is currently very cheap compared to alternative crops, and this might severely curtail acreage in the U.S., Rogers Varner, president of Varner Brokerage, said.

A National Cotton Council of America survey this month suggested that U.S. cotton producers may plant 9.6 million acres of cotton this year, which is 14.5% lower than in 2024.

"With prices at 60 cents (per lb), we used to make great money. Now our inputs are so high, we need around 90 cents or so to make it work," said Steve Olson, a cotton farmer in Hale County, Texas.

ICE cotton futures have fallen 3.5% so far this year, marking the fourth consecutive year of losses, on weak global demand and fears of tariff wars under U.S. President Donald Trump.

"Cotton prices have dropped nearly 20% from a year ago, and with 11.18 million acres planted in 2024-25, it's hard to see us holding above 11 million acres in 2025-26," said Justin Cardwell, head of research and technology at Alternative Option.

The U.S. Department of Agriculture said farmers planted 11.18 million acres of cotton in 2024, up 9.3% from 2023.

The government is scheduled to release preliminary forecasts for 2025 on February 27, ahead of its March 31 planting intentions report based on a survey of roughly 70,000 farmers.

"Our challenges are high input cost. You know the fertilizer, the fuel and of course equipment cost, with an increase in interest rates, equipment costs are one of the high input costs. Our equipment is fairly old," said Martin Stoerner, a farmer in Floyd County, Texas.

Farmers will likely reallocate to more profitable crops, such as soybeans or corn, when they cut back on cotton, depending on regional market conditions and demand, Cardwell of Alternative Option said.

"For many, the math is simple: if cotton isn't paying the bills, you plant what does."

Low cotton prices could cause some planting to go over to probably corn and maybe a little bit to the wheat market, said Jack Scoville, vice president at Price Futures Group.

The likely reduction in acreage and tightening U.S. cotton supply may offer near-term support to declining prices, analysts said.

Cotton prices could rise 10 cents in the coming months if growers scale back production or exit farming altogether, said Keith Brown, principal at Georgia-based cotton brokerage Keith Brown and Co in Georgia