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© 2009 Calcot Ltd.
Cotton: The White Gold of the Golden State
California Cotton Questions & Answers
Where does it happen?
California’s cotton is produced primarily in seven counties that make up the San Joaquin Valley, and three—Fresno, Kings, and Kern—account for most of that.

Some acreage is also planted in the Imperial Valley and the Palo Verde Valley of Southern California, and in the 1990s cotton returned to the Sacramento Valley, north of the state’s capitol.

Why here?
Warm springs, hot summers, dry falls and wet winters give these regions near-perfect weather for producing optimum quality and yield (the amount of cotton produced per acre). The San Joaquin Valley, California’s primary growing area, is very well suited to growing cottons that are difficult to produce, and is especially well known for its Upland Acala (uh–KAY–la) cotton variety, though California is also the nation’s largest Pima (PEA–ma) cotton growing area. Upland Acalas are recognized by textile mills as having very strong, long fibers of consistent, high quality.

How much cotton gets produced?
The state’s annual production varies, depending upon prices and growers desires to produce the crop, though weather also plays a major role in assessing how many acres finally get planted. However, as a general rule, production will be about 2.0 to 2.5 million bales from approximately 700,000 to 800,000 acres.

The last Census of Agriculture noted there are 1,393 cotton farms, with average acreage of 500 acres each.

That’s five to eight percent of total U.S. cotton plantings, but about 10 to 14 percent of total U.S. yearly production, due to California’s phenomenally high yields.

California is frequently the second highest producing state in the U.S., behind Texas. But California typically outshines the rest of the country—indeed, the world—with its impressive yields. Yield of 1,200 to 1,300 pounds per acre is not uncommon, compared to the average U.S. yield of 615 pounds.

California cotton producers must produce high yields, however. The cost of production in the state is estimated to be $800 to $1,000 per acre, which is possibly the highest production cost in the world. So profit margins are tight, and can be severely reduced by bad weather, insect control, low yields or declining prices—and sometimes all four happen at the same time!

How long does it take to produce a crop?
An annual crop, cotton is planted each spring in the San Joaquin Valley beginning in March and usually completed by May 1. The warm days and cool nights of the summer growing season of the Valley are ideal for cotton production, and annual precipitation (between 6 and 10 inches) falls mostly in the off season, maximizing production potential and preserving fiber quality.

California cotton is totally irrigated, and picked by machines. Picked cotton is stored in the field in large bundles known as “modules,” which are transported to cotton gins throughout the growing region.

Are there a lot of gins?
There aren’t as many gins as there used to be. In 1963, for example, the state had 299 active cotton gins, the highest ever. Today, there are 75 active gins. Although the numbers have declined, gin capacities and efficiencies have been increased accordingly, allowing the entire crop to be ginned and packaged into bales in about three months.

What happens to it once it’s out of the field?
Once the raw cotton is packaged into bales (weighing 500 pounds each) at gins, it then moves into the marketing channels.

How does it get sold?
Cotton is usually marketed either through cotton merchants (who buy and sell cotton), or through cooperatives, such as Calcot, which is owned by and works for the cotton grower. In effect, the co-op serves as the farmer’s agent, selling cotton and returning full proceeds of the sale to the grower.

So what happens to it in the meantime?
During the selling process, bales will be stored in warehouses, or sometimes shipped directly to a shipping port. Since most Far West cotton is shipped overseas, it is usually loaded into shipping containers for export. Most Calcot cotton is shipped through the ports of Los Angeles or Long Beach, although San Francisco–Oakland is also a frequently used shipping point.

What’s cotton worth?
It depends. The value of California’s cotton crop, including lint, cottonseed and other products, approximates $1.0 billion annually. The San Joaquin Valley cottons are highly desired by the world textile industry and tend to capture a premium price, compared to other cottons. Cotton is sold on a price per pound unit, and the final price is a combination of the cotton futures price, as traded on the New York Cotton Exchange, and of the basis, which is a premium or discount applied to futures. The resulting figure is known as the cash price. Buyers and sellers will negotiate each sale, and the price of cotton changes every second.

What products does California cotton get made into?
Typical products for California cotton include high count yarn products, such as dress and top quality knit shirts, sheets, towels: primarily fine fabrics, and both California's SJV Acala and Pima cottons are preferred for very fine fabrics. Products such as denim (jeans) and T–shirts use lower quality, less valuable cotton grown in other parts of the U.S. and the world.

Do the products get made in the U.S.?
Not much; most of the final products made from California cotton will be produced overseas. About 80 to 85 percent of California's high quality cotton lint is exported each year, principally to Pacific Rim countries, but other important markets include Turkey, India and China.

What’s the crop worth to the state’s economy?
The California cotton industry directly provides for over 20,000 jobs on farms, in gins, warehouses, cottonseed oil mills, and textile mills.

In addition to the direct industry employment, when employment related to the value added goods and service of cotton's domestic and export trade, it is estimated that cotton accounts for an additional 17,000 jobs in California.

Revenues generated in the form of products and services by this industry to California's economy are in excess of $3.5 billion annually, according to the California Cotton Growers and Ginners Association.

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