AWP Drops Below Loan; Updated Weighted Average Farm Price Through April2004

LUBBOCK, June 4, 2004                     By Shawn Wade

      Anup-tick in both sales volume and prices received helped push the total numberof bales reported as marketed by the National Agricultural Statistics Servicethrough April 2004 over the 10.4 million bale mark.

      Forthe 2003-04 marketing season though, the change wasn't enough to keep thecalculated weighted average price received by growers from falling to 62.67cents per pound.

      Basedon current estimates, the final 2003-crop Counter Cyclical payment rate wouldbe approximately 3.06 cents per pound. Producers who received an advance CCpayment would receive the difference between the advance payment rate and thefinal payment rate or about one more cent per pound.

      The2003 Counter-Cyclical payment rate authorized under the 2002 Farm Bill will bebased on the 12-month Weighted Average Price Received by growers. For cottonthe 12-month Weighted Average Price will reflect price and bales marketed forthe 2003 marketing year. The 2003 cotton marketing year began in August 1, 2003and ends July 31, 2004.

      Thefollowing table shows the average price received each month by farmers and theassociated weighted average price based on cumulative bales marketed throughApril 2004.

 

Average PriceReceived Through April 2004

For 2003-crop UplandCotton

(Weighted by balesmarketed)

 

Bales Marketed

Prices

 

(000's of Running bales)

(cents/Lb.)

 

Monthly

Cum.

Monthly

Weighted

August

420

420

46.30

46.30

September

769

1,189

55.70

52.38

October

1,783

2,972

68.00

61.75

November

1,912

4,884

63.40

62.40

December

1,938

6,822

64.10

62.88

January

1,546

8,368

62.50

62.81

February

1,422

9,790

62.70

62.79

March

167

9,957

59.40

62.74

April

473

10,430

61.20

62.67

May

na

na

61.20*

na

Source: NationalAgricultural Statistics Service; * = preliminary

 

      Inother market news, the week of June 4-10 will mark the first time sinceSeptember that the Adjusted World Price (AWP) has dipped below the 52-centCommodity Credit Corporation Upland cotton loan rate. Announced June 3, the AWPin effect for the week of June 4-10 is 51.07 cents per pound.

      Forproducers with cotton in the CCC loan the new AWP means that they can nowredeem their cotton with storage and applicable warehouse charges paid by thegovernment. It also means that cotton redeemed this week would incur aMarketing Loan Gain (MLG) of 0.93 cents that would count against a grower's2003 payment limitation.

Scattered Rainfall Provides Welcome Relief ToSignificant Portions of the High Plains

LUBBOCK, June 4, 2004                     By Shawn Wade

      Thereturn of storm clouds to the area brightened the outlook of some High Plainsproducers, created extra work for others and left many more hoping their turnwas just around the corner.

      Overallthe storms that tracked through the region June 2 and 3 have been described asjust what the doctor ordered for those in the coverage area. The weather was awelcome change from events just a few days earlier when the area saw high windsand blowing dust invade the Memorial Day weekend.

      Sofar only a few reports have been received of damage significant enough torequire replanting, although the job of assessing affected acreage is stillunderway.

      Thegood news is that hail was apparently not a widespread by-product of thestorms. Some isolated hail damage has been reported on acreage in Terry, Crosbyand northern Lubbock Counties.

      Highwinds associated with the storms, coupled with several other high wind eventsthe preceding week have also been blamed for some acreage loss as well.

      Rainfalltotals reported by the Texas Tech West Texas Mesonet system ranged from just afew tenths to more than three inches in some locations.

      Observationsfrom June 3 indicate Abernathy recorded the highest total at 3.4 inches whileLevelland took the second spot with 2.69 inches of rainfall.

      OtherTTU Mesonet locations recorded a beneficial three-quarters to 1.5 inches ofrain that should help crops continue to move ahead and develop root systemsthat will allow them to tap into the area's still abundant sub-soil moisturesupply.

      Unfortunatelythe storms that occurred June 3 did not reach as far as many would have liked.To date, a majority of the region's 1.5 million dryland acres failed to receiveany significant moisture and continue to wait for adequate rainfall togerminate seed planted into dry planting beds. Fortunately, chances foradditional precipitation continue to be part of the weather forecast throughthe weekend.

      Mostshort-term forecasts indicate 20-30 percent chances for isolated thunderstormsover the weekend in most areas of the High Plains.

      Anyoneinterested in keeping track of weather conditions on the High Plains or inaccessing the Texas Tech Mesonet data can do so through the Plains CottonGrowers website (www.plainscotton.org).