Forecasting the U.S. Upland Cotton Season-Average Farm Price: An Application of a Futures Price-Based Model

A forward-looking futures price-based model is developed to assist in forecasting the U.S. upland cotton season-average farm price. The model generates monthly season-average price forecasts using a monthly basis and marketing-weight expectations. Actual monthly farm prices are also incorporated as they become available. The model results are compared with price projections in the World Agricultural Supply and Demand Estimates report and the final season-average price estimate reported by USDA. The model’s futures-adjusted forecasts are timely, reasonably accurate, and can support the forecasting of the season-average farm price for upland cotton.