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Cotton producers' choice of marketing techniques

Author

Listed:
  • Oscar Vergara

    (AIR Worldwide Corporation, 131 Dartmouth Street, Boston, MA 02116., E-mail: OVergara@air-worldwide.com)

  • Keith H. Coble

    (Department of Agricultural Economics, Mississippi State University, Box 9755, Mississippi State, Mississippi 39762. E-mail: Coble@agecon.msstate.edu)

  • Thomas O. Knight

    (Department of Agricultural and Applied Economics, Texas Tech University, Box 42132, Lubbock, Texas 79409. E-mail: Tom.Knight@ttech.edu)

  • George F. Patrick

    (Department of Agricultural Economics, Purdue University, 403 W. State St. West Lafayette, Indiana 47907-2056., E-mail: Gpatrick@purdue.edu)

  • Alan E. Baquet

    (Institute of Agriculture and Natural Resources, University of Nebraska, 202 Agricultural Hall, Lincoln, Nebraska 68583-0708., E-mail: Abaquet@unlnotes.unl.edu)

Abstract
A survey of cotton producers was conducted in Mississippi and Texas. The econometric model consists of a multinomial logit model of cotton producers' choice of marketing techniques. The results indicate that cotton acres positively influence pooling and negatively influence cash sales. Producers willing to incur higher transaction costs in market information systems and training tend to choose futures|options contracts and forward pricing. It was found that risk-averse producers tend not to choose pooling contracts. On the other hand, producers who seek abnormal gains through speculation tend to choose pooling contracts. Finally, producers who perceive markets as being price-efficient prefer cash sales. [EconLit citation: Q130.] © 2004 Wiley Periodicals, Inc. Agribusiness 20: 465-479, 2004.

Suggested Citation

  • Oscar Vergara & Keith H. Coble & Thomas O. Knight & George F. Patrick & Alan E. Baquet, 2004. "Cotton producers' choice of marketing techniques," Agribusiness, John Wiley & Sons, Ltd., vol. 20(4), pages 465-479.
    • Handle: RePEc:wly:agribz:v:20:y:2004:i:4:p:465-479
    DOI: 10.1002/agr.20023
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    References listed on IDEAS

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    1. James S. Eales & Brian K. Engel & Robert J. Hauser & Sarahelen R. Thompson, 1990. "Grain Price Expectations of Illinois Farmers and Grain Merchandisers," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 72(3), pages 701-708.
    2. Steven C. Blank, 1990. "Determining futures “hedging reserve” capital requirements," Journal of Futures Markets, John Wiley & Sons, Ltd., vol. 10(2), pages 169-177, April.
    3. Barry K. Goodwin & Ted C. Schroeder, 1994. "Human Capital, Producer Education Programs, and the Adoption of Forward-Pricing Methods," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 76(4), pages 936-947.
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    5. McNew, Kevin & Musser, Wesley N., 2000. "Evidence Of Farmer Forward Pricing Behavior," Working Papers 28568, University of Maryland, Department of Agricultural and Resource Economics.
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    Cited by:

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    2. Carlberg, Jared G. & Ward, Clement E. & Holcomb, Rodney B., 2006. "Success Factors for New Generation Cooperatives," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 9(1), pages 1-20.
    3. Deane, Paul & Malcolm, Bill, 2006. "Do Australian woolgrowers manage price risk rationally?," AFBM Journal, Australasian Farm Business Management Network, vol. 3(2), pages 1-7.
    4. Bignebat, C., 2018. "Learning process in marketing contract choice: the case of cereals in the Paris Basin," 2018 Conference, July 28-August 2, 2018, Vancouver, British Columbia 277233, International Association of Agricultural Economists.
    5. Isabel Bardají & Belén Iráizoz & Manuel Rapún, 2009. "Protected geographical indications and integration into the agribusiness system," Agribusiness, John Wiley & Sons, Ltd., vol. 25(2), pages 198-214.
    6. Carrer, Marcelo José & Silveira, Rodrigo Lanna F. & Meirelles De Souza Filho, Hildo, 2017. "Citrus Producers' Choice of Price Risk Management Tools," 2017 Annual Meeting, July 30-August 1, Chicago, Illinois 258352, Agricultural and Applied Economics Association.

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