• H1 profit slides 73.9% to AUD4.1m
  • Cotton seed business ships 113,000 mt
  • Reduced 2016 Australian crop size to lower ginning volumes
Reduced 2016 Australian crop size is set to lower Namois ginning volumes

Reduced 2016 Australian crop size is set to lower Namoi's ginning volumes

A 39% reduction in the size of Australia's cotton crop caused by dry weather conditions and lower irrigation water supplies contributed to a profit slide for cotton dealer Namoi Cotton Co-operative in its first-half. 

Net profit after tax amounted to AUD4.1m (US$2.9m) for the six months to 31 August, compared to AUD15.7m in the same period a year ago. Namoi's cotton seed business shipped 113,000 mt, down from 223,000 mt last year, while ginning volumes of the 2015 crop amounted to 535,000 bales, compared to 1.12m bales in 2014.

“Cotton ginning and seed volumes together with marketing volumes procured by Namoi Cotton Alliance (NCA) have been negatively impacted by the 39% reduction in the Australian crop size,” said CEO Jeremy Callachor. 

However, he added: "Improved ginning throughput rates, effective operations work systems, reduced headcount and stringent cost management have in part alleviated the impact of this significant core business volume reduction.” 

The 2015 Australian crop is now expected to be 2.3m bales, down from the previous year's crop of 3.8m bales. 

Callachor said the group's planting of the 2016 crop is around 50% complete, and estimates the 2016 Australian crop is 2m bales, down 13% from 2015. The reduced 2016 crop size is forecast to lower Namoi's ginning volumes to between 400,000 and 500,000 bales.