Managing Quality Uncertainty in the Cotton Markets

Eluned Jones


Cotton purchase decisions are based on price, end-use suitability, and fiber properties. Before the introduction of H.V.I. cotton fiber with properties that more than exceeded the spinning requirements was often used to ensure quality of the yarn. H.V.I. testing information economically provides the information needed to ensure optimum requirement for spinning are met. However, the use of this information is changing as textile mills consider overall processing costs, rather than minimum fiber costs. Minimizing fiber costs subject to an average set of property requirements has the potential to increase overall spinning costs due to the variability in the bale laydown. Reducing uncertainty in processing, and consequently risk costs, can be achieved through decreased variability in supplies.

Reprinted from Proceedings of the 1994 Beltwide Cotton Conferences pp. 471 - 474
©National Cotton Council, Memphis TN

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Document last modified Sunday, Dec 6 1998