UNITED STATES DEPARTMENT OF AGRICULTURE 
DEPARTMENT BULLETIN No. 1444 
Washington, D. C. 
December, 1926 
COTTON PRICES AND MARKETS 
By Alonzo B. Cox, Agricultural Economist, Division of Cotton Marketing, 
Bureau of Agricultural Economics x 
CONTENTS 
Page 
Demand for cotton 1 
Uses of cotton 2 
Where cotton is consumed 4 
Net consumption of cotton and 
cotton goods 5 
Qualities of cotton affect de-. 
mand 6 
The grade 7 
Measures of demand 8 
Supply of cotton 9 
Supply of spot cotton — 10 
The world cotton crops 11 
Linters 12 
Quality as a factor in supply 14 
Carryover 14 
World carryover of gin-hale cot- 
ton 15 
The cotton movement 15 
Forecasting supply - 17 
Forecasting the crop of the 
United States 17 
Types of cotton markets 18 
Spinners' markets 18 
Futures markets 23 
Centralizing or large spot mar- 
kets 39 
Page 
Types of cotton markets — Continued 
Primary markets 44 
Price making in the futures market- 48 
Market forces and positions 48 
Price movements and their 
causes 49 
Transition from old to new crop_ 55 
Influence of spots on price in 
futures markets 58 
Straddle parities 59 
Straddle between different de- 
livery months 61 
Cost of production 61 
Conversion of price of spots into 
price of futures 61 
The two contracts 61 
Conversion of spots into " con- 
tract class " equivalent 62 
Methods of establishing commer- 
cial differences 64 
Risks in price insurance 69 
The basis 70 
The squeeze 73 
Supply of certificated cotton 74 
Summary 75 
An understanding of the marketing of cotton involves a knowledge 
of the demand for cotton, the supply of it, the machinery developed 
to bring demand and supply into trading relations, and the his- 
torical development of these three market factors. This analysis of 
the fundamental factors involved in cotton price making and this 
description of the markets in which prices are made is a contribution 
to that understanding. 
DEMAND FOR COTTON 
The price of cotton depends upon the intensity of human wants, 
the supply available, and the purchasing power of those whose wants 
1 Credit is due Florena Cleaves for much assistance in research and in the preparation 
of the text of this report. 
6103 c 
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