U.S. Cotton Prices and the World Cotton Market; Forecasting and Structural Change

Olga Isengildina-Massa and Stephen MacDonald
Authors registered in the RePEc Author Service: Olga Isengildina Massa

No 55950, Economic Research Report from United States Department of Agriculture, Economic Research Service

Abstract: This report analyzes recent structural changes in the world cotton industry and develops a statistical model that reflects current drivers of U.S. cotton prices. Legislative changes in 2008 authorized USDA to resume publishing cotton price forecasts for the first time in nearly 80 years. Systematic problems have become apparent in the forecasting models used by USDA and elsewhere, highlighting the need for an updated review of price relationships. A structural break in the U.S. cotton industry occurred in 1999, and world cotton supply has become an important determinant of U.S. cotton prices, along with China’s trade and production policy. The model developed here forecasts changes in the U.S. upland cotton farm price based on changes in U.S. cotton supply, the U.S. stocks-to-use ratio (S/U), China’s net imports as a share of world consumption, the foreign supply of cotton, and selected farm policy parameters.

Keywords: Agricultural and Food Policy; Agricultural Finance; Crop Production/Industries; Marketing; Production Economics (search for similar items in EconPapers)
Pages: 26
Date: 2009-09
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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Working Paper: U.S. Cotton Prices and the World Cotton Market: Forecasting and Structural Change (2009)
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Persistent link: https://EconPapers.repec.org/RePEc:ags:uersrr:55950

DOI: 10.22004/ag.econ.55950

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