Evaluation of alternative cotton marketing strategies in Central Texas /
| Main Author: | |
|---|---|
| Other Authors: | , , |
| Format: | Thesis Book |
| Language: | English |
| Published: |
1988.
|
| Subjects: | |
| Online Access: | ProQuest, Abstract Link to OAKTrust copy |
| Abstract: | The marketing of agricultural commodities is a significant determinant in farm profit. Past research has attempted to provide general marketing assistance by determining the "best" marketing alternative. Little has been done to provide producers with a tool to determine their own marketing strategy. This study analyzed 55 different marketing alternatives in developing a cotton marketing strategy that is the best at a specific point in time. Various levels of hedging, forward contracting and cash marketing were considered. An actual Central Texas farm was used to provide acreage and yield data. Future prices and yields were estimated using the harvest time data and the average farm yields and current cash prices. Stochastic dominance was used to determine preference for each of the marketing strategies relative to the other strategies and to develop an efficient set. Net returns were calculated for three risk preference categories, i.e., risk averse, risk medium and risk loving. Only a single alternative (100% acreage forward contract) was selected by a risk averter. The annual net returns and the net present values for the three risk categories in this study were compared with actual farm data, a no strategy approach and four strategies defined by two previous studies. This analysis determined that by using current data for hedging and contracting and estimated harvest time values to determine a marketing strategy at critical times during the production cycle, net returns can be improved more than by selecting a single marketing strategy based on long term data. For a single Central Texas farm this method provided a higher return than all other strategies considered. The results of this study indicate the need for producers to rely on current data and marketing expectations in determining their optimal marketing strategy rather than trying to find a single marketing strategy that will give the highest returns in all situations. |
|---|---|
| Item Description: | Typescript (photocopy). Vita. "Major subject: Agricultural Economics." |
| Physical Description: | ix, 133 leaves : illustrations ; 29 cm |
| Bibliography: | Includes bibliographical references (leaves 107-111). |