1. Marketing and Exporting Cotton By Bridget

2. Costs of Growing Cotton
Australian cotton prices vary due to the world cotton price (denominated in US dollars) and the Australian-US dollar exchange rate. This is reliant on a number of factors including supply and demand, the value of the Australian dollar, quality, ability for growers to fulfil their contracts and shipping the cotton on time.  The price that a grower receives goes up and down depending on how all these factors combine at a given time. Also other inputs, such as seed, fuel and fertilisers are becoming more expensive.
Variable costs of farming cotton:
Farming/cultivation=$129
Seed and sowing=$115
Fertilisers and application=$374
Herbicides and application=$82
Insecticides and application=$125
Defoliants and application=$103
Irrigation=$573
Insurance=$110
Consultant=$74
Licence Fees=$370
Contract Picking=$334
Ginning and Levies=$756
Pigeon Pea Refuge=$31
Total: $2,558

3. Classing Cotton
Following the ginning process, samples of cotton are collected from each bale for classing
Cotton classing sorts the fibre into different quality based grades. The better the fibre quality, the higher the grade and the more the grower is paid for the cotton
There are many factors in cotton classing that determine the grade including colour, staple length, fibre strength, micronaire, neps (or knottiness), stickiness and trash content.

4. Modern Classing of Cotton
High Volume Instrument (HVI) testing machines quickly and accurately check quality and value of cotton fibres
An HVI test print-out includes information relating to the following areas:
Colour grade (relating to any visible impurities and the degree of whiteness)
Length (price of cotton is roughly proportional to staple length. Australian crops typically produce 28mm staple length if irrigated, but shorter from a dryland crop).
Micronaire (the fineness of the cotton that affects how quickly it can be spun)
Trash and dust (the number of trash and dust particles that in the cotton)
Strength (if the cotton is stronger it can be used in smaller quantities and for a wider range of products)
Length (fibre length)
Each bale of cotton has a classing description. This grade determines whether the cotton is sold for a premium (higher
price) or discount (lower price)

5. Marketing Cotton
Australia has a highly competitive marketing system where growers forward sell their crops directly to independent marketing companies
The Australian Cotton Shippers Association (ACSA) represents these companies.
These companies then sell the cotton to overseas markets, and pay the grower

6. Income from Cotton
On average for 2011 the income per hectare was about $1800/hectare. Although costs vary throughout the seasons. Payment can be done in cash, contracts or in pools. There are different types of pools including seasonal where the producer gives a certain proportion to the company but only seasonally. Minimum pool ensures that the producer receives at least the minimal amount of profit. The craft pool is when an farmer promises an certain amount of cotton and it can be traded.

7. Improving efficiency to increase profits
Profit = Income – Costs
To improve profit farmers either need to increase income, or decrease input costs.

8. Exporting Australian Cotton
Australia is the third largest exporter of cotton in the world
90% of Australian cotton is exported to other countries such as China, Indonesia, Thailand, Japan, Korea, India, Pakistan and
The main ports for Australian cotton are in Sydney, Melbourne and Brisbane.