It is not just the premium SJV Acala growth that our mill customers are comparing us to any more. More and more mills are using Brazilian cotton and Fibermax varieties, which are selling at much cheaper levels than Australian. We need to be able to demonstrate a clear quality advantage in order to maintain our premium.
Statistics available on the Certified Fibermax website show that in South Texas for example, Fibermax cotton has been able to generate digital length of 1.14 (the lower end of the 1-5/32 range) compared to 1.08 (the lower end of the 1-3/32 range) for all cotton bales grown in the region.
Data available from the United States Department of Agriculture showed a marked increase in the proportion of the US crop with longer staple readings over the last five years, while the proportion of shorter staple had fallen dramatically.
For the SJV crop, USDA data indicates over 80pc of the crop typically grades 1-1/8 and better on a five year average basis, and the average staple length is 1-5/32.
By comparison, according to ACSA statistics, on a five year average basis, 74.4pc of the Australian crop has graded 1-1/8 and longer.
Clearly the vast majority of the time we are growing 1-1/8 cotton but if we are going to compete with SJV and command a premium over the up and coming growths then it is no longer good enough for us to fall below this bar.
The bottom line is that we need to produce a top quality product if we are to stay in business. Furthermore, it is not appropriate that the average basis carries the penalty for lack of differentiation, he said.
Cotton Australia and the Cotton Evaluation and Advancement Committee had been consulted on the change in base staple length. Individual merchants Premium and Discount sheets will be adjusted to reflect the changes for all purchases for the 2006 crop year and beyond.
Australia Cotton Shippers Association
marketing@alchempro.com
