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As Arkansas Cotton Acres Rebound, So Do Gin Numbers

Arkansas cotton gin data

Graph courtesy University of Arkansas

The number of active cotton gins in Arkansas rose to 33 in 2017, paralleling an increase in cotton acres, according to statistics from the National Agricultural Statistics Service.

“With a recovery in cotton acres the last couple of years, Arkansas is also seeing some gins come back to life,” says Scott Stiles, Extension economist for the University of Arkansas System Division of Agriculture. “In 2017, we saw two more gins operate than in 2016, one each in Craighead and Lee counties.”

Arkansas farmers planted 445,000 acres of cotton in 2017, up from 380,000 in 2016. Cotton acres had been in slow decline since 2000, with the exception of 2006, when growers planted 1.17 million acres.

Higher Volume Gins

Stiles also says the NASS numbers showed another trend: “The trend toward much larger and higher-volume gins is certainly continuing. A gin is definitely a massive investment in equipment that requires a lot of volume to make the numbers work.”

Of the 33 operating gins in 2017, 23 ginned 20,000 bales or more each. In 2016, only 17 gins handled the same volumes.

Craighead and Mississippi counties had the largest number of working gins in 2017, each with seven. Ashley County had four, St. Francis had three, and Lee and Poinsett counties each had two. Clay, Chicot, Crittenden, Desha, Greene, Lincoln, Monroe and Philipps counties each had one.

Low Cottonseed Prices

However, low cottonseed prices may put the brakes on growth, Stiles says.

“We may find in 2018 that even increasing cotton acreage may not be enough to sustain gin numbers in the state,” he says.
“From discussions at our winter production meetings, I did hear of at least one gin that did not plan to operate this fall. They cited low cottonseed prices as the reason. Earlier this year cottonseed prices fell to decade lows. Revenue from seed sales is the lifeblood for gins.”

Cottonseed prices spiked in June 2014 to $460 per ton and sank to $130 per ton in November 2017.

For more information about agricultural economics, contact your county Extension office or visit www.uaex.edu.

This article was contributed by Mary Hightower, University of Arkansas System Division of Agriculture.