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After three years of drought, significant rainfall finally arrived in West Texas. In certain areas, precipitation was heavy enough to cause flooding. While flooding may have a detrimental impact on some farm operations, the arrival of rain has already caused projections for abandonment to decrease.

Listen in as Cotton Incorporated’s Senior Economist Jon Devine discusses forecasts for planted acreage in the U.S. and around the world and analyzes the production outlook for 2023/24.

There has been renewed concern about 2022/23 production recently. The current focus of attention is India, where arrivals at gins are significantly behind the pace from one year ago. There has been speculation that Indian growers may be withholding volume in hopes of securing better prices, but the breadth of the gap has given root to worry that the Indian crop may end up being smaller than currently forecast.

After a meeting in early May, Federal Reserve officials decided to make its tenth increase in interest rates since March of last year. The speed and magnitude of the change in interest rates presented a series of challenges to business practices. Financing costs have risen sharply across all industries, and a focus on cost-cutting has already led to layoffs at several large corporations.

For cotton, a steep correction in demand has been underway for several months. As concerns about the trajectory of economic growth mounted toward the second half of 2022, order volumes collapsed. However, consumer spending did not drop as was feared. Although uncertainty remains for the future, inflation-adjusted U.S. consumer spending has held at levels 25% higher than in 2019.