Plains Cotton Cooperative Association at the cooperative's 58th annual stockholders meeting, reported record total net margins of $41.2 million from fiscal 2010-2011 operations. Further cash distributions to members totaling $36.3 million will be made this month comprised of $19.5 million in cash dividends, $4.7 million in stock retirements, and $12.1 million in retirement of per-unit retains.
"All divisions were profitable despite the greatest volatility any market has ever experienced," said PCCA President and CEO Wally Darneille. "After several years of world cotton production that was lower than demand, unforeseen late-season crop problems in the United States, China, and Pakistan coincided to create an explosive price situation during the winter. To the best of our knowledge, we paid significantly more equity to our marketing pool members than any other pool where producers are not required to shoulder personal financial risk. In fact, the premiums we achieved over the Commodity Credit Corporation loan were more than six times higher than the average of the last 10 years." PCCA's West Texas/Oklahoma/Kansas marketing pool was the second largest ever despite the late-season adverse weather.
"The adverse weather last October affected volume more than was initially apparent, or our results would have been even better," Darneille continued. "Unfortunately, the crop simply did not produce the yields that we, the USDA, the gins, and our members expected."
PCCA's Textile and Apparel Division returned to profitability during the year as efforts to develop more value-added business paid off with 13 new accounts, including several high-end brand names such as American Eagle Outfitters, Urban Outfitters, and Under Armour.
"We also entered the European and Indian jeans markets, an accomplishment once believed to be impossible," Darneille reported. "Our jeans sales to Replay, a high-end Italian brand, will contain denim made at our American Cotton Growers mill. Indian Terrain, a department store chain in Bombay, is offering a line of our jeans bearing the Cotton USA logo. We also launched our university-branded jeans products at Texas Tech, Texas A & M, Alabama, Georgia, Auburn, and other schools."