Production and Financial Benchmarks for Texas Cotton Producers

The focus of this paper is the benchmarking of production and financial performance for cotton producers in Texas.  Data was obtained from over 100 Texas cotton producers who participated in the Texas Financial and Risk Management (FARM) Assistance program.  This program collects historical yields and crop mix allocations to project likely outcomes (production and financial) with price and production risk factors incorporated.  These producers then utilize the results of the Farm Assistance program simulation to assess existing and alternative production plans.  An analysis of this database was conducted in order to identify some key production and financial benchmarks that can be used by individual cotton producers as a management target.  A discussion of why these benchmarks are critical to profitability will also be included.
Texas FARM Assistance participation among cotton producers has taken place in all cotton producing regions of the state.  It is anticipated that we will be able to differentiate the benchmarks of performance for the different regions of the state (High Plains, Rolling Plains, Coastal Bend, etc.) as well as for irrigated and dryland producers, and producers with differing crop rotations.  The information provided from this analysis will enable producers in different cotton production regions and employing alternative tillage system to evaluate their own performance against a group of their peers and identify where management scrutiny will be most productive.