ABSTRACT

This study employs a structural time series method to model and estimate U.S. cotton exports. The results show that the fluctuations observed in U.S. cotton exports have transitory (cycle), secular (trend), and seasonal characteristics. The estimated structural relationships after accounting for the impact of the unobserved components indicate that U.S. cotton exports volume responds positively to higher international price relative to domestic price of cotton and negatively to real exchange rate volatility. The study also confirms that the U.S. government export-marketing loan program has a significant and direct effect on U.S. cotton exports.