Someone recently was asked if he could sum up the financial condition of the cotton industry in one word. The answer came back that it would be difficult in one word, but he could in three words -- 'dismal - dismal - dismal'. Although this may not be completely accurate, it would be reasonable to conclude that the current situation and shortrun outlook is not favorable, but perhaps the longer run outlook could be viewed as somewhat more encouraging.

When discussing the financial situation of cotton producers, it is useful to view in a historical perspective and then look at what options might develop to influence the welfare of producers for the future. When discussing the cotton producing element of the cotton industry, we are generally talking about producers in six states in the South and West (Table 1). In 1970, there were an estimated 45,000 cotton farmers or farms on which over 50 percent of farm income was contributed by cotton. In 1980, the number of cotton farms was near 28,500 (Table 2). It is estimated that there are near double this number of farms on which cotton is raised.

To service the producers, there are about 3,300 active cotton gins, nearly 550 warehouses, and a lesser number of textile mills.