Cotton Price Risk and Sleepless Nights

Kim Anderson, Roger Sahs, and Phil Kenkel


 
ABSTRACT

Producers who do not use futures or options contracts sometimes feel that they are leaving thousands of dollars on the table. If they sell their cotton, they worry that prices will increase. If they do not sell their cotton, they worry that prices will decline. The research reported in this paper shows that simple cash marketing strategies will allow producers to sell their cotton with the confidence that, over a 10 year period, they will receive an above average price.



Reprinted from Proceedings of the 1994 Beltwide Cotton Conferences pp. 454 - 456
©National Cotton Council, Memphis TN

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Document last modified Sunday, Dec 6 1998