Cotton growers in the United States have good reason to worry about the potential for Brazilian farmers to increase cotton acreage, according to a visiting crop consultant who spent the summer touring much of this country.
After traveling from Iowa to Georgia to the Mississippi Delta, and many spots in between, Haroldo Hoogerheide says he is convinced that the farmers in Northeast Brazil pondering an increase in cotton acreage could successfully compete with U.S. growers in the cotton market.
“Brazilian farmers can produce a high quality cotton crop with a lower cost of production,” says Hoogerheide of Balsas, Maranhao, Brazil. What's more, he says, the potential is there for farmers in the country's northeast region to increase their crop plantings to roughly 1 million acres.
According to the International Cotton Advisory Committee, Brazil produces about 2.6 million bales of cotton annually with an average yield of about 540 pounds per acre. Brazil exports about 14,000 bales and imports 1.3 million bales. There are 460 cotton gins across the country's cotton producing regions.
Despite the fact that U.S. cotton production is about six times that of Brazil, Hoogerheide believes competition for the cotton market will continue to heat up between the two countries.
Hoogerheide, who works for a crop consulting company in the northeastern region of Brazil, says his region of Brazil is experiencing a resurgence of cotton farms. After almost dying out a few short years ago, crop acreage is building back and is reaching new levels, sometimes displacing the area's traditional soybean, corn and rice crops on newly cleared land.
Although Central Brazil is traditionally the country's cotton growing region, Northeast Brazil has a transportation advantage over the central region due to its proximity to the ocean, he says.
In addition to the transportation advantage available to growers in Hoogerheide's area, cropland in the region is relatively inexpensive. Cropland in Northeast Brazil sells anywhere from $300 to $1,000 per hectare, or about $125 to $422 per acre. Cotton can be grown during the six-month rainy season, which eliminates the need for costly irrigation treatments.
The consulting firm that Hoogerheide works for currently handles 100,000 acres of cropland, 85 percent of which is soybeans and the remainder is split between rice, corn and cotton.
“I believe in this region. We have the potential to make high yields of high quality cotton, but we are in need of increased infrastructure, such as cotton gins, to handle any acreage increase,” he says. “A lot of land that is not currently in production is being cleared, and some of it is going to cotton.”
Currently, about 6,000 acres of cotton is produced in Northeast Brazil and Hoogerheide expects that figure will rise by at least 4,000 acres in 2002. “Cotton acreage is increasing because of the profit potential it offers farmers. Soybeans and corn don't offer farmers as much profit potential as cotton,” he says.
Like U.S. growers, Brazilian cotton farmers remained concerned about both the commodity market and the quality of the crops they produce. “During my travels in the United States I've noticed more worry among cotton researchers about quality than about volume,” Hoogerheide says. “The same is true in Brazil because our cotton farmers also know that they need to produce a high quality cotton crop. You can only export when you have quality.”
One major difference Hoogerheide sees between Brazilian cotton farmers and U.S. cotton farmers is the cost of production each group is faced with. “We can consistently produce high yielding, high quality cotton at a lower cost,” he says.