Effects of Changes in the International Cotton Market on the U.S. Cotton Economy

Patricia A. Duffy, James W. Richardson, and Michael K. Wohlgenant


 
ABSTRACT

Because exports account for over 1/3 of all sales of U.S. cotton, changes in the international market for cotton can have a large effect on U.S. cotton price. Supply and demand relationships for cotton in both the domestic and international markets were estimated and incorporated into a FORTRAN simulation model. The model was used to evaluate the effects of increased exports of cotton fiber from the People's Republic of China and the exports of cotton fabric from other eastern nations. Under current farm policy, producers are somewhat insulated from shocks to the world market, but government costs, market price, and total use of cotton are affected by these changes.



Reprinted from 1986 Proceedings: Beltwide Cotton Production Research Conferences pp. 350 - 353
©National Cotton Council, Memphis TN

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Document last modified Sunday, Dec 6 1998