COOPERATIVE MARKETING OF COTTON oA 
ery by the member of all cotton produced or acquired by him during 
_the years specified therein. In the event of nondelivery it provides 
for the payment of liquidated damages, the amount being $10 per 
bale in the Arkansas Farmers’ Union association, 10 cents per pound 
in the Staple Cotton Cooperative Association,* 5 cents for short- 
staple upland and 10 cents for long-staple Pima in the Arizona 
association, 3 cents per pound in the Georgia association, and 5 cents 
per pound in all others. It also specifies that the association is 
entitled to an injunction to prevent breach of contract, and to a 
decree of specific performance to compel delivery. Its validity has 
been generally established by the courts of the several States. 
Apparently it is all that is implied in the commonly used terms 
“ironclad,” “ water-tight,” and “legally binding.” 
The first series of contracts are in every case long-term contracts. 
In the Oklahoma association seven years was the period specified; 
in all others five years. As these contracts, which are all noncan- 
cellable, expire, it is expected that each of the associations belonging 
to the American Cotton Growers’ Exchange will adopt as its second 
series a contract generally similar in terms and for a five-year 
period. Such a contract has been adopted recently by the Texas 
Farm Bureau Cotton Association, which began its second campaign 
in March, 1925, to obtain members for the years 1926 to 1930, in- 
clusive. 
The renewal marketing agreement adopted by the Staple Cotton 
Cooperative Association, effective for the years 1925 to 1930, does 
not follow the original contract in-a number of its major provisions. 
Among other fundamental changes it permits members to withdraw 
in any year upon their written notice to the association prior to the 
second Wednesday in May. 
Students of cooperative marketing are generally agreed that con- 
tracts between members and their associations are desirable and, in 
most instances, essential to success. This is particularly true in large 
associations of the centralized type and during the period of time 
necessary to demonstrate their economic benefits. However, there 
is a difference of opinion regarding the provisions and the use of 
contracts. Many believe that a long-term contract, even longer than 
five years, is desirable; but that such contracts should have a clause 
permitting withdrawal at certain periods at the option of the mem- 
ber. Results obtained by the Staple Cotton Cooperative Association 
under its renewal marketing agreement, and by the several Cali- 
fornia organizations that have recently incorporated the withdrawal 
feature in their contracts, when compared with those operating with 
a noncancellable agreement, should provide in time a valuable ex- 
perience upon which to base future contracts in centralized coopera- 
tives. 
The fact that there is so much discussion regarding marketing 
contracts is partly because the intensive use of such contracts is a 
relatively new development in cooperative marketing. Also, too 
much emphasis has been placed on its efficacy as a legal weapon to 
enforce delivery. With a growing recognition of the weakness in 
any scheme or attempt to operate a cooperative organization on a 
4This is reduced to 5 cents per pound in the renewal marketing agreement, effective 
for the years 1925 to 1930. 
