OUTLOOK FOR US COTTONSEED OIL

COTTON GINNINGS UP, CROP FORECAST HIGHER

WHAT'S NEW @ COTTONSEED.COM

US COTTONSEED PRODUCTS EXPORT REPORT

GLOBAL AG REPORTS ON Bt

COTTONSEED PRODUCTS IN THE NEWS

MOVING?

OUTLOOK FOR US COTTONSEED OIL - Domestic disappearance of cottonseed oil (CSO) should total close to 900 million lbs. in the marketing year that ended September 30 and stay close to that level again this current year, according to NCPA’s latest estimates.  Beginning stocks of cottonseed oil for the 2004-05 marketing year (that began October 1, 2004) were close to 54 million lbs., based on findings from the Association’s survey of member oil mills.  Allowing for ending stocks on September 30, 2005, of 45 million lbs., total usage of cottonseed oil should reach 945 million lbs.  Exports should total nearly 55 million lbs. during the marketing period, leaving domestic disappearance of 890 million lbs.  For the 2005-06 marketing year that began October 1, beginning stocks of CSO plus domestic production should make 960 million lbs. of CSO available for consumption.  Exports, in all likelihood, will fall in 05/06 in response to strong domestic demand, perhaps to 40 million lbs.  Should that occur, domestic consumption of CSO could reach 875 million lbs., leaving ending stocks at 45 million lbs. again next September 30. Current USDA forecasts call for CSO domestic usage to fall nearly 10% during the year, a scenario not likely given the current environment with the trans fats and most manufacturer’s desire to  include cottonseed oil in their new formulas for “trans fat success”.

COTTON GINNINGS UP, CROP FORECAST HIGHER - Cotton ginnings prior to October 1 this year have reached 2.286 million bales, according to USDA. That’s 3% and just over 59,000 bales more than the 2.227 million bale total ginned to this point a year ago. In 2003, a little over 2.0 million bales had been ginned by October 1…..All cotton production is forecast at 22.7 million bales, up 2 percent from the September forecast but 2 percent below last year's record high production. Yield is expected to average 797 pounds per acre, up 15 pounds from last month but down 58 pounds from 2004.  The October area expected for harvest remains unchanged from last month at 13.7 million acres but is up 5 percent from 2004…...World vegetable oil supplies are forecast to reach 122 million metric tons in 05/06, an increase of 4% over the 117 mmt total of last year.  Total usage of vegetable oils worldwide is expected to be 114 mmt, 5% above last year and thus drawing down ending stocks of vegetable oils to 7 mmt.  In the US, vegetable oil supplies are expected to be 13 mmt, a gain of just over 4% from the 12 mmt total of a year earlier.  Total vegetable oil usage is projected to be 11 mmt, also a 4% increase from the 10.6 mmt total of 2004/05. Forecasters see ending stocks slightly higher for 2005/06 at 1.06 mmt, up from 1.01 mmt in 2004/05. (Source: USDA, NASS & WASDE)

WHAT'S NEW @ COTTONSEED.COM - US cottonseed production is forecast higher this month as a result of an increase in US cotton production, based on USDA’s October estimate.  Complete state-by-state projections for cotton and cottonseed are available in the Statistics section of the web site…..A Pakistan firm is seeking 2nd cut linters in the Cottonseed Linters Forum section.  In addition, an interested party is looking for information regarding the old Southwest Cotton Company Oil Mill, located in the Phoenix area, in the Cottonseed Oil Forum…..A French company is looking for meal in the Cottonseed Feed Products Forum section of the NCPA web site.

US COTTONSEED PRODUCTS EXPORT REPORT

GLOBAL AG REPORTS ON Bt - Egypt: Egypt leads the Middle East and North Africa region in the development and acceptance of agricultural biotechnology and the Ministry of Agriculture is a strong supporter of biotechnology.  Egypt is a large consumer of agricultural products (such as corn, soybeans, and soy meal) derived through modern biotechnology and imported from the United States and Argentina.  The government continues to maintain a general import policy that allows imports so long as the product imported is also consumed in the countries of origin. Egypt has not produced any commercial biotechnology crops.  However, the Agricultural Genetic Engineering Research Institute (AGERI) is developing a number of GM products for commercialization by working with leading biotechnology companies and universities in the United States. These crops are tuber moth-resistant potatoes, virus-resistant squash and tomatoes, corn borer-resistant maize and drought-tolerant wheat.  Through collaboration with Monsanto, AGERI has developed an insect-resistant long-staple GM cotton strain…...France: The French press revealed on September 6 that 500 to 1,000 hectares of biotech corn are currently under cultivation.  While this acreage is virtually insignificant, the revelation was surprising in that it represents a sizeable increase from recent years.  A wide range of commentary has ensued.  The French government has delayed the vote of the French biotech law, including EU Directive 2001/18 provisions, which would make declaration of biotech production compulsory, and coexistence rules, for about a year.  This proposed law is now expected to be debated by the French Parliament in early 2006.  This spate of publicity is likely to give impetus to moving the debate forward, which would be welcomed by producers and environmentalists alike. (Source: USDA/FAS)

COTTONSEED PRODUCTS IN THE NEWS - The Indianapolis (IN) Star, Birmingham (AL) News, Beckley (WV) Register-Herald and Houston (TX) Chronicle have all recently pointed to cottonseed meal as an excellent fertilizer for gardeners to use as fall approaches. Landscape experts point to the slow release of nutrients from organic materials like cottonseed meal that will be broken down into inorganic materials to be taken up by plants, trees and shrubs.  Quick-release fertilizers, they point out, do not last as long and can damage plants if over-applied. Liquid fertilizers work but must be applied more often and frequently do not last as long…..Crain’s Detroit.com highlights Better Made Snack Foods, Inc. in an October issue.  Founded in 1930, the firm employs over 200 people to produce a variety of snack foods, from chips and pretzels to pork rinds and beef jerky.    The company reportedly uses 12,000 pounds of potatoes an hour. “Better Made uses only cottonseed oil, the best oil for potato chip production.”

MOVING? - Please send all change of address information to: National Cottonseed Products Association, 104 Timber Creek Drive, Suite 200, Cordova, TN  38018, or email to info@cottonseed.com.

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© National Cottonseed Products Association, Inc.

October 12, 2005