How drought cost America’s cotton industry billions

Cotton farmers in Texas, where about 40% of the U.S. crop is produced, are facing a severe drought that is costing the industry billions.

A lack of rain and extreme heat is forcing growers in the state to abandon almost 70% of the cotton acres they planted earlier this year, according to a forecast by the United States Department of Agriculture (USDA).

“It’s been one of the harshest growing years that we have ever seen historically, all the way back to the 1950s,” said Kody Bessent, CEO of Plains Cotton Growers, which represents farmers in the 42 counties of the High Plains region in north Texas. 

The U.S. is the world’s largest exporter of cotton, sending the vast majority of the cotton it grows abroad. But this year, America’s cotton production is expected to drop to about 14 million bales, down 21% from last year, the USDA says.

CNBC traveled to Texas, the largest cotton-producing state in the country, to hear from the farmers and others in the industry who are being hit hard.

Watch the video to learn more.