A cotton gin is a factory which processes the raw product for eventual export.

There is a handful of cotton growers already in the region who want to expand their plantings and not have to transport their crops to Queensland or NSW for processing.

A meeting of growers will be held in Katherine in the next few weeks to discuss the plans.

Cotton Growers across North Australia have welcomed the news that a feasibility study and detailed business plan is to be undertaken into the construction of a cotton gin in the north to service the developing cotton industry.

The study is being funded by Singapore agribusiness OLAM Australia (Queensland Cotton), Northern Territory Cotton Growers Association and NT Government and will be undertaken by PriceWaterhouseCoopers.

Northern Territory Cotton Growers Association chairman Bruce Connolly said it was an exciting development which would give growers the confidence to take the next step and plant cotton for the coming season.

"The fact that industry and government have pulled together to fund this important study will give a tremendous boost to growers and the future for cotton in the north."

PriceWaterhouseCoopers have been engaged to complete these studies and will map out a clear pathway for a sustainable development model for the cotton industry over the next decade.

"Whilst much work is still required to make this key piece of infrastructure a reality, it is clearly a step closer and will create a significant boost to local jobs and economies over the coming years," Mr Connolly said.

John Robinson from OLAM Australia said Queensland Cotton was excited to support the emerging industry in the north and will continue to support the development aspirations of family enterprises to diversify into cotton production now and into the future.

Queensland Cotton brings significant experience to this process and owns and operates cotton gins in Queensland and New South Wales.

NT Primary Industry Minister Paul Kirby said it was great to see industry driving these important studies for key enabling infrastructure.

"This will support our joint goal to grow and diversify agriculture in the NT," he said.

"My department will assist with this study and are also working to ensure government support keeps pace with this emerging industry."

The Department of Primary Industry and Resources will be a critical partner in the development of a cotton industry, especially in regard to biosecurity, research and regulatory arrangements.

The feasibility study will be completed by the end of this month and will identify preferred locations, funding opportunities, through-put and ownerships structures and models.

It has not always been plain sailing for cotton growing in the Katherine region.

Katherine hosted a packed public rally opposed to the industry in 2002 which led to the ALP of the time banning the crop.

The then NT Government banned cotton growing or dams in the Daly River and halted any further approval for subdivision or clearing until a sustainable land use plan was developed.

But successful trials and water techniques demonstrated successfully at the Katherine Research Farm have bolstered interest in the crop again.

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