The 1989 Upland Cotton Program: How Profitable for Arizona Producers?

Abstract

The profitability of full and "50/92" participation in the 1989 upland cotton program was estimated for representative farms in Maricopa, Pinal, LaPaz and Yuma counties. Special attention was given to the effect on profits of the reduction in permitted acreage, and to farm size and multiple-partner ownership. Full participation was more profitable than "50/92" or nonparticipation given the assumptions used here. The expected profitability of the crops used on 'free acres" in the large farm case -- alfalfa or pima cotton --has a major positive effect on program profitability. The possible use of upland base acres to produce pima cotton or durum wheat, given the current high prices of those crops, is also discussed.