Your Guide to the Texas Cotton Industry

Key takeaways: 

• As the biggest cash crop in Texas, cotton plays an important economic role in the Lone Star State. 
• Cotton producers in Texas need to make plans for irrigation, pest management, drought considerations, and more to protect their profitability. 
• A successful cotton operation will likely need several financial services, including equipment loans, agribusiness capital, and crop insurance.

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The Texas cotton industry isn’t just significant to the Lone Star State — it’s critical to the rest of the country. 

Texas produces more cotton than any other state in the U.S. It supplies about a quarter of the entire domestic supply and has a statewide economic impact of more than $5 billion. 

Throughout the Lone Star State, farmers plant about 5 million cotton acres each year. According to Texas A&M, if you consolidated all of Texas’s cotton fields into one tract, it would be about the size of New Hampshire. 

Needless to say, it can be a lucrative industry to join, and demand isn’t slowing down. 

If you’re a landowner in Texas, planting cotton can be a great option to maximize the ROI of your acres. So if you’re planning to throw down some cottonseed soon, here’s what you need to know about the industry. 

How much cotton does Texas produce? 

Despite Texas playing a big role in many agricultural industries — beef, hay, corn, etc — cotton is its top cash crop. The state produced more than 4 million bales of Upland cotton in 2024.

More than half of the total U.S. cotton supply is grown in Texas.

What is harvested cotton used for? 

Many think about cotton as just the raw material used to produce clothes — including sportswear, jeans, socks, and virtually any other type of apparel. 

But the crop is far more than that. Cotton fibers are also used for furniture upholstery, towels, medical supplies, diapers, biodegradable packaging, and more. Cotton is even used to produce astronauts’ space suits.

Beyond just the cotton fibers that you get from the plants, cottonseed is also an important byproduct. Cottonseed itself can be used for cattle feed. Cottonseed oil can also be used for human food products like salad dressing, cooking oil, and even mayonnaise. 

Which regions of Texas are best to grow cotton? 

According to Texas A&M, there are eight main cotton growing regions in Texas: the Panhandle, South Plains, Permian Basin, Trans-Pecos, Rolling Plains, Blackland Prairies, Winter Garden, Coastal Bend, and Lower Rio Grande Valley. 

The South Plains is the biggest cotton producing region and accounts for the majority of the cotton harvest in Texas. In some of the region’s best years, more than 3 million acres are planted here. 

In other areas, like the Panhandle, cotton can also serve as a valuable crop to rotate with corn. 

What types of cotton are grown in Texas?

The Gossypium hirsutum variety — more commonly known as Upland cotton — is what the majority of Texas cotton farmers grow. Pima (or Egyptian) cotton is another popular variety, usually grown in the Far West region, where it’s better suited to more desert conditions.

How to get started as a Texas cotton producer 

If you’re thinking about either kickstarting or expanding a cotton operation in Texas, there are several moving pieces to consider:

• Irrigation: Depending on where you’re located and what type of cotton you’re growing, you’ll likely need to think about irrigation. Some regions experience fairly regular rainfall and don’t require as much irrigation. Other acres, like those in the Trans-Pecos area, require 100% irrigation because of the dry climate. Reach out to your local agronomist to talk about irrigation options for your land.
• Pest management: Several pests, including fleahoppers, cutworms, and spidermites, can harm cotton harvests. But historically, the most damaging insect has been the boll weevil, a beetle that lays its eggs on early-stage cotton buds or bolls. 

In the early 1990s, the Texas Cotton Producers organization was charged with implementing the Texas Boll Weevil Eradication Plan. Since then, infestations of the pest have become less common — but continuous monitoring is still important.

• Equipment: Planting and harvesting cotton requires certain equipment and tools like cultivators, planters, cotton pickers (which remove seed cotton from bolls), and cotton strippers (which remove the entire boll from the plant). If you need financing support to either purchase or lease equipment for your operation, Texas Farm Credit offers options for equipment loans and agricultural operating lines of credit.
• Drought insurance: No crop is ever fully safe from a bad weather year. But cotton can be particularly susceptible to drought conditions. According to an analysis of USDA data, about 60 percent of crop insurance payouts in Texas have been to cover cotton losses. One particularly dry year (2022) saw the state lose 74 percent of its cotton crop. Amidst the extreme drought, farmers received about $3 billion in crop insurance payouts that year. Keeping insurance on your cotton acres is an essential part of risk management if you plan to join the industry.

Get financing help from the experts 

Growing cotton is as quintessentially Texan as raising cattle or wearing workboots. The state’s cotton industry is a vital component of the entire U.S. cotton supply. 

Farmers who join the industry need the financial and logistical support to keep that supply flowing. That’s what Texas Farm Credit is here for: to give you the best options for land loans, agribusiness financing, equipment loans, crop insurance, and more to keep your cotton operation running smoothly. Apply today, or reach out to our team with any questions.