Cotton producers face an uncertain market future as demand for cotton and cotton products, like apparel, tumbled due to COVID-19 stay-at-home orders and economic recession, said a Texas A&M AgriLife Extension Service economist.

John Robinson, Ph.D., AgriLife Extension cotton marketing specialist, College Station, said cotton and the industries that touch it are sliding alongside the economy.

cotton recession
The cotton market’s post-pandemic recovery could last into late 2021 due to reduced demand during a recession and a subsequent oversupply. (Texas A&M AgriLife photo by Kay Ledbetter)

Retail apparel sales numbers dropped 79% from March to April, Robinson said.

Two contributing factors have been bad for sales of retail apparel and trickled down to cotton markets, Robinson said.

First, sheltering-in-place mandates meant stores closed and people were not making retail purchases, Robinson said.

Second, gross domestic product, which measures the value of all final goods and services produced, is negative in the U.S. and globally, indicating a recession. Millions of Americans have lost their jobs, the economy slowed, and people are spending their money on necessities rather than discretionary items like clothes, he said.

Recession affect on cotton

Robinson said during recessions consumers will often shift spending on food to buy cheaper items like ground beef versus a ribeye steak. But a recession makes the cotton market especially sensitive to economic boons and busts.

“Historically, if you plot a recession, cotton consumption moves together alongside it,” he said. “When times are tough, clothing is discretionary. People will put off buying new clothes until times are better. That makes cotton more vulnerable than any other ag product I can think of.”

Robinson said the export market has been “decent enough,” but suspects those numbers are being propped up by China. The Chinese government supports cotton prices by buying up reserves.

“They ordered 100,000 bales of cotton,” he said. “But they’re just holding them. At this point they’re not spinning them into yarn.”

A major apparel producer like China holding a glut of U.S. cotton worries Robinson about the 2020 season and 2021 marketing year. Reduced demand going forward will likely reflect in slower export sales in 2021.

U.S. Department of Agriculture demand forecasts for total consumption have steadily dropped since March and reflect a slowdown and excess supply, he said. Meanwhile, the USDA’s preliminary estimate for U.S. cotton acres released March 31 was 13.7 million acres.

The cotton acreage estimates won’t be updated until June, but Robinson said expectations are that the number will be closer to 12 million-13 million acres. The USDA reported cotton farmers planted 13.7 million acres in 2019, a 3% reduction from 2018.

Beyond the pandemic response

Despite the reduction in acres, the expectation for 2020-2021 is that the U.S. will have more cotton than it needs. Futures market prices, which have ranged between 48 cents per pound to 58 cents per pound in the last few months, will likely not improve.

By comparison, the futures market price for 1 pound of cotton was 70 cents in January, Robinson said. According to AgriLife Extension budget calculations, most farmers’ break-even price, which is the cotton cash price needed to cover input costs alone, is 60-70 cents per pound, depending on individual costs and eventual yield. Cash prices generally fall 4-8 cents below futures market prices.

“If we end up with excess cotton, it will continue to trade in that low range, because I don’t see any fundamental economic reason for it to rise,” he said.

Robinson said federal price support mechanisms, along with additional funding from the Coronavirus Aid, Relief and Economic Security Act, should get farmers to next season.

He believes the lag, both in economic and logistical terms, could mean cotton markets won’t return to normal until Christmas 2021, if COVID-19 is controlled beyond the initial outbreak.

“If we have a vaccine and all the assurances that we’ve got it licked medically, we might see the economy start picking back up at a rapid pace,” he said. “There has to be demand for products, and the lag will likely take months when you’re talking the global cotton supply chain and people having confidence and ability to spend money. The last thing on an unemployed person’s mind is new apparel.”

AgriLife Extension district reporters compiled the following summaries:


Storms delivered spotty to heavy rainfall with amounts ranging from half an inch to 7 inches. Some flooding was reported. Farmers were not able to harvest due to rainfall. Wheat harvest was expected to continue as conditions allowed. Corn looked good and was pollinating. Conditions were windy, and temperatures were above normal. Crops were in great condition, but rapid corn and sorghum development was depleting soil moisture in some areas. Cotton emerged and was developing well. Pastures were in good condition. Rice, sunflower, soybean and peanut plantings were delayed.


Most of the district received rainfall, hail and wind with some areas receiving up to 12 inches of rain. A tornado was reported in Bowie and resulted in extreme damage to the area. Wheat harvest began, and most fields were ready to cut. Wet conditions halted various farming activities for a few days. Some cotton was planted. Stocker cattle continued to move from wheat fields and pastures to feedlots.


Rainfall amounts were 1.5-2 inches. Soil moisture conditions were excellent in most areas. Crops looked better and yield potential improved. Corn planted early had silked, and stalks were very short with small ears. A considerable amount of grain sorghum began to turn red. Some cotton was blooming and squaring. There was some yellowing in cotton, but it should pass as conditions warm and bolls dry out. Several rice fields were flooded. Some soybeans were beginning to bloom. Wheat and oat harvests were complete. Hay fields were starting to improve after a long period without moisture, and fertilizer applications continued. Weeds were expected to be a problem in hay fields and pastures. Livestock were doing well.


More rainfall was received across most of the district. Gregg County reported saturated conditions, and fieldwork halted. Polk County, however, reported soil moisture conditions in the southern parts of the county were drying out. Pasture and rangeland conditions were good. Subsoil and topsoil conditions were adequate. Most producers have either gotten their first cutting of hay or were preparing for it. Hay production was off to a good start. Gardens showed good production and growth. Livestock were in fair to good condition. Cattle market prices remained low and unstable. Wild pigs caused damage to pastures and hay fields.


Farmers planted irrigated cotton fields. Showers across the district ranged from trace amounts to 1.1 inches. Corn started to emerge across the district. Cotton planted early was starting to emerge following recent rains. Many farmers were waiting to plant dryland cotton. Cattle were in good condition.


Northern parts of the district reported short to adequate topsoil and subsoil moisture. Pasture and rangeland conditions were poor to good. Winter wheat was in fair to good condition. Central parts of the district reported very short topsoil and subsoil moisture levels, while southern areas reported short subsoil and topsoil conditions. Corn was planted and in good condition. Cotton planting was progressing. Sorghum planting began. Dryland cotton farmers were waiting for rain to plant.


Topsoil moisture levels were mostly adequate with some reports of surplus moisture. Heavy rains delivered up to 5 inches in some counties. Pastures looked good, but the wet weather slowed hay harvest. Wheat was looking good as well.


Daytime temperature highs were above 100 degrees with lows in the mid-60s. Precipitation ranged from half an inch to 7 inches. Hail and damaging winds were also reported. Wheat harvest moved along at a rapid pace. Overall yields were above average so far. Cotton planting picked up considerably, but conditions were not ideal. Growers needed significant rain to add moisture to the top several inches of soil. Many producers were irrigating after planting. Producers were dry-planting dryland acres. Chinch bugs were seen in cotton. Corn and sorghum were in decent shape, but crop conditions were starting to decline due to the heat and lack of moisture. Watermelons looked good. Pasture and rangeland conditions were starting to brown. Livestock were in overall good condition despite conditions and not much new grass growth. Producers sprayed for pecan nut casebearer and were monitoring for eggs. Lecanium scale was reported in pecan orchards. Producers continued to work sheep, goats and cattle. Producers continued to feed livestock and wildlife.


Rainfall ranged from half an inch to 4.34 inches. Rains improved conditions, but more moisture was needed. Soil moisture levels were in great shape, and forages responded accordingly. Some areas received hail damage, and some young cotton may have to be replanted. Haygrazer fields looked good, and the first cutting should occur in a few weeks. Pecan orchards were off to a good start.


Recent rains helped conditions. Most northern areas received rain. Some areas reported flooding while other areas remained dry and were drying under high daytime temperatures. Rangeland and pasture ratings ranged from good to excellent. Soil-moisture levels ranged from adequate to surplus.


Moisture conditions improved across most of the district with some areas reporting up to 1.25 inches of rain. Pasture and rangeland conditions also improved. Corn and grain sorghum looked good with the added moisture. Oat and wheat harvests were going well with good yields. Grain harvesting was winding down. Onions were still in the field. Brush control spraying began. Livestock were in fair to good condition. Cattle market prices increased slightly, and sheep and goat prices were steady. Shearing continued. Sightings of fawns and baby turkeys were being reported.


Northern parts of the district reported adequate soil moisture levels. Western, eastern and southern areas reported very short to adequate soil moisture. Atascosa County reported favorable planting and growing conditions. Several counties reported daytime temperatures above 100 degrees. Most counties reported some rain showers. Some counties received 1 inch or more of rain. Zapata and Jim Wells counties reported up to 4.5 inches of rain. More rain was in the forecast for parts of the district. Sun and high temperatures were sapping topsoil moisture in areas that received lighter rains. Peanut planting was underway. Potato and wheat harvests continued. Corn was in the silking stage, and cotton was at the match square stage. Bermuda grass was being cut and baled. Hay producers were fertilizing pastures and hoping rains materialized. Some hay producers were preparing for a second cutting. Pasture and rangeland conditions continued to improve in areas that received moisture. Irrigated wheat fields were being harvested. Rains were expected to help sunflowers and sorghum. Some sorghum fields were headed out and turning color. Growing conditions for dryland crops that received rain improved. Many row crops were expected to have yield reductions due to dry conditions. Heavy rains replenished watering tanks for many cattle producers. Onion harvest was wrapping up.

Source: Adam Russell, Texas AgriLife Extension