Changes In Relative Commodity Prices and the Outlook for Arkansas Cotton Acreage

Relative commodity prices determine profitability among cropping alternatives. Expectations of increased cotton prices had little impact on increased cotton acreage in Arkansas for the 2010 production year. This presentation evaluates net returns for crops that compete for acreage in Arkansas and investigates circumstances that could lead to acreage shifts. A model for state acreage allocations quantifies changes in planted acreage in relation to commodity prices received. Average costs and returns data are presented with alternative commodity prices that indicate potential acreage reallocations.