How Important are Cotton Gins to Rural Economies in the Mid-South?

The mid-south cotton industry has seen major short-term structural adjustments in the past two years. From 2006 to 2007, cotton acreage dropped for most Mid-South states between 25 and 50 percent. The decline in acreage continued in 2008. Total cotton production in 2008 will likely be reduced even more as a result of adverse weather conditions resulting from hurricanes. Reduced cotton production means less cotton is processed through existing gin facilities. These facilities are often a major economic activity in cotton producing areas. Reduction in cotton processed through the gins will have ripple effects through the economy. This study uses data from a survey of gins in the Mid-South states of Arkansas, Louisiana, Mississippi, Missouri, and Tennessee to identify the economic linkages between the gins and local economies. These data are then used within the IMPLAN^TM input-output model to assess the economic impact of gins on local communities. Economic impact assessments are presented for each of the Mid-South states.