NEW YORK, June 29 (Reuters) - Cotton plantings in the
United States in 2011 are expected to hit a five-year high,
with farmers sowing as many acres as they can to offset adverse
growing conditions in much of the South.

A Reuters poll of industry participants forecast cotton
plantings in the top exporting country would rise to 13.26
million acres (5.37 million hectares), above the U.S.
Department of Agriculture's March projection of 12.566 million.

The USDA will release its annual planted acreage report on
Thursday at 8:30 a.m. EDT (1230 GMT). If accurate, the survey
projection would make it the biggest area planted in cotton
since 2006, when 15.27 million acres were sown.

(Graphic: http://r.reuters.com/quj42s )

It would also be up 20 percent from the 11.04 million acres
planted in 2010.

'The June 30 report will reflect the cotton producers'
extremely strong incentive to plant or attempt to plant on
heavily insured acreage,' said Mike Stevens, an independent
cotton analyst in Louisiana.

Farmers in Texas normally insure their cotton crop against
adverse weather such as drought. Insurance payments are higher
for crops that are planted than those that have not been sown.

This creates a situation in which farmers are planting
despite one of the state's worst droughts ever, knowing the
cotton would unlikely germinate, let alone mature to harvest.

That way, a disastrous drought does not wipe out farmers in
the area, analysts said.

'The guys out in west Texas ... when they sense a drought
coming on, they plant every acre they can find to collect the
insurance,' said John Flanagan, president of brokers Flanagan
Trading Corp in North Carolina.

Texas is the biggest cotton-growing U.S. state, accounting
for about half of the acres the government expects to be sown
in 2011. It has been reeling from the worst drought in a
decade, according to the U.S. Drought Monitor.

The culprit is the weather anomaly La Nina, an abnormal
cooling of waters in the equatorial Pacific Ocean that is often
linked to severe droughts in the southwestern United States.

The 2010/11 La Nina is one of the strongest in a decade.
Farmers have also increased their plantings to take
advantage of the highest-ever spring prices for the new crop.

With the December contract trading at over $1.20 a
lb, compared to levels in years past of well below $1, cotton
has become competitive against other high-priced agricultural
commodities such as soybeans, corn and wheat.

Cotton was the best-performing commodity in 2010, rising
more than 90 percent to levels unseen since the U.S. Civil War.
The rally spilled over into 2011, hitting a peak of $2.27 a lb
in the first quarter of the year as tight supplies and robust
demand, especially from top consumer China, fueled the surge.

Sharon Johnson, senior cotton analyst with commodities
brokerage Penson Futures, said if the June 30 cotton planted
figure is higher than trade expectations, the market may
respond accordingly if current prices are deemed too high.

'We may trade that report for a day or two, but it is
already obsolete,' she said.

'It's not going to tell us what we need to know, and that
is how high is abandonment ... not just in west Texas, but
across the southern U.S. because of adverse weather
conditions.'