The 2004 United States cotton crop is the largest on record, producing 22.6 million running bales, 27 percent above 2003 production. The 9 percent increase in harvested acres and the record high of 843 pounds per acre, a 125 pound per acre increase from last season, contributed to this tremendous crop. This crop was ginned with 896 operating gins over a nine month period. This season provided many challenges to ginners; extended ginning season, high moisture cotton, high energy cost, and low seed prices. Cottonseed production yielded a record high 8.24 million tons, up 24 percent from 2003.

Ginning cost surveys were mailed to gins in cooperation with regional ginners associations, such as the Southern Cotton Ginners Association, to identify variable costs that include: labor (seasonal and full-time), bagging and ties, repairs and maintenance, drying and electrical costs. Gin managers also reported performance information, which included ginning rate, length of season, number of bales, and type of cotton ginned. In addition, module tarps and hauling cost information was reported. Ginners returned 156 surveys which represented about 4.9 million bales, 22 percent of the U.S. production.

From the Beltwide survey results, the average annual volume was 31,569 bales with an average variable cost of $20.22 per bale. The largest increase from the 2001 survey data was fuel cost, a 15 percent increase for electricity and 45 percent increase for dryer fuel. Labor cost per bale was slightly less, while cost for bagging and ties was slightly more. Increased annual volume continues to yield reduced variable ginning cost. Gins with an annual volume of 40,000 or more bales per year have an average cost of $17.40 per bale, while gins averaging less than 15,000 bales per year have an average cost of $24.14 per bale.