WNDI 2008 1

Ethanol Aff Scholars

Ethanol Aff Scholars

Ethanol Aff Scholars...................................................................................................................................................1
Ethanol Aff Scholars......................................................................................................................1
Cotton-Developing Nations........................................................................................................................................2
Cotton-Developing Nations...........................................................................................................2
Cotton-US econ turn...................................................................................................................................................3
Cotton-US econ turn......................................................................................................................3
WNDI 2008 2
Ethanol Aff Scholars

Cotton-Developing Nations
Cotton subsidies don’t have an effect on West Africa
IHT “Study on U.S. cotton subsidies” 6/21/2007 International Herald Tribune
<http://www.iht.com/articles/2007/06/21/business/cotton.php>
Cotton prices are so volatile from year to year, Rodrik said, that the African farmers might perceive the
higher prices from the elimination of U.S. domestic subsidies as little more than a blip. "I'm not sure the
effect will be large enough for farmers to really notice," he said. But the authors of the report said that removing U.S.
subsidies would permanently shift the price of cotton upward, with prices subsequently fluctuating around a higher average. Sumner
also said that in the West African cotton-growing countries, government-run or regulated companies are involved in procurement,
marketing and exporting of cotton. Farm prices are generally set in advance of the marketing season, which means the farmers do not
feel the full volatility of prices, he said. Oxfam has acknowledged that cotton farmers in West Africa are contending
with many problems beyond U.S. subsidies. Cotton prices have declined, production costs have risen
and yields in Africa have stagnated. "Subsidy reform alone will not resolve all the challenges facing the
cotton sector," Oxfam said.

Cotton Subsidies help developing nations

NYT “Ending Aid to Rich Farmers May Hurt the Poor Ones” 12/18/2005 The New York Times
<http://www.nytimes.com/2005/12/18/weekinreview/18porter.html>
However, some economists are warning that if the industrialized world ends its farm subsidies and lowers
its tariff barriers to agricultural imports, poor countries may not be helped, but harmed. "Everybody
is saying that the last barrier to the development of these poor countries are the subsidies in rich
countries. That's the wrong diagnosis," said Arvind Panagariya, an economics professor at Columbia University. "The
least developed countries would be hurt by agricultural liberalization by the developed countries." In a
paper published in April, three economists - Nava Ashraf from Harvard, Margaret McMillan from Tufts, and Alix Peterson Zwane from
the University of California, Berkeley, concluded that agricultural supports boosted the per capita income of two-thirds of 77 developing
nations, including most of the poorest countries, like Burundi and Zambia. Developing countries that are big agricultural exporters -
including Brazil, Argentina, Indonesia, Thailand - are undoubtedly hurt by the farm subsidies. But these countries are not among the
poorest. Rather, many poor nations are big importers of farm goods, so they benefit from the lower
agricultural prices caused by support policies in rich countries. Tariffs and subsidies keep cheaper
imports out of the industrialized countries and encourage their local farmers to produce more. This
raises the domestic prices of their farm goods. Yet, as it artificially boosts production of agricultural
products, it pushes worldwide prices down. A 1999 study by economists Alex McCalla of the University of California,
Davis, and Alberto Valdes of the World Bank, found that 105 of 148 developing countries, including 48 of the 63 poorest nations,
imported more food than they sold. Some poor countries export nonfood agricultural products, like cotton. Yet even including these
commodities, 85 of 148 developing countries and 30 of the 63 poorest imported more than they exported. True, some very poor nations,
like Guyana, are food exporters. Yet even for them, Mr. Panagariya argues, the end of subsidies and tariffs might prove
counterproductive, because some of their farm products can already enter the industrialized nations
duty free. For instance, most farm goods from the world's least developed countries get into the
European Union without paying high tariffs under a preferential program called "Everything but
Arms." This allows the poorest nations to sell within the union at the artificially inflated European
price. If the European Union were to dismantle its protections, letting its price for farm goods fall,
these poor country exporters would be worse off. Mr. Panagariya concedes there is one important exception to this
argument: cotton. Europe doesn't produce or subsidize it. But the United States and China provide enormous subsidies to domestic
producers. Depressed world cotton prices are intensely hurting African cotton farmers. Yet even in this case,
there is another side to the argument. Bangladesh, one of the world's poorest countries, imports cotton to feed its textile factories.
Bangladesh isn't clamoring for an end to cotton subsidies because higher prices would hurt its main
export industry. William Cline, an economist at the Center for Global Development, argues that this analysis omits the fact that
more than half the world's poor are in countries that are net agricultural exporters or that could become net exporters if the distortions
were eliminated. Yet what virtually all economists agree on is that developing countries could help themselves
greatly by liberalizing their own agricultural markets. Poor countries often heavily protect their
farmers, supporting vast uncompetitive agricultural sectors and drawing investment and labor into
farming that would be better used elsewhere. Two World Bank economists, Kym Anderson and Will Martin,
concluded that if the world were to dismantle its agricultural protections, most of the benefits for developing
countries would come from the reduction of their own systems of farm support. "Liberalization in the rich
countries is a good thing, but in my opinion a small thing," said William Masters, a professor of resource
economics at Purdue University and an expert on agriculture in Africa. "Poor countries' own barriers are
the biggest constraint to their own development."
WNDI 2008 3
Ethanol Aff Scholars

Cotton-US econ turn

Cotton industry generates revenue of $120 annually
NCC “Trade and U.S. Cotton - Facts and Objectives” National Cotton Council of America 2003
<http://www.cotton.org/news/releases/2003/cotton-trade.cfm>
The industry and its suppliers, together with the cotton product manufacturers, account for one job of
every thirteen in the nation. Annual cotton production is valued at more than $5 billion at the farm
gate. In addition to the fiber, cottonseed products are used for livestock feed, and cottonseed oil is used for
food products ranging from margarine to salad dressing. While cotton's farm gate value is significant, a more
meaningful measure of cotton's value to the U.S. economy is its retail value. Taken collectively, the business
revenue generated by cotton and its products in the U.S. economy is estimated to be in excess of $120
billion annually. Cotton stands above all other crops in its creation of jobs and its contribution to the
U.S. economy.

Cotton Industry Key to US Economy

Economic Research Service “Cotton Acreage Gains of Past Decade Reverse 60-Year Decline” July 1996
<http://www.ers.usda.gov/Publications/summaries/cotton.htm>
Fewer but bigger farms dominate cotton production. In 1949, 1.1 million farms harvested an average of 24
acres of cotton each. In 1992, 34,800 farms harvested an average of 315 acres of cotton each. Despite this
more than tenfold growth in average size, individuals or family businesses control about 75 percent of the
cotton farms. U.S. cotton production has shifted westward. From 1970 to 1985, production in California and
Arizona as a share of total U.S. production almost doubled from 16 percent to 31 percent. Lower unit
costs of production, higher net returns in relation to other crops, flat terrain, good soils, and the availability of
irrigation water in the Southwest and West were the primary reasons for the shift. However, this movement
has stabilized recently, and an increasing share of U.S. cotton acreage is moving back into the Southeast and
Delta States. Improved insect control programs and higher relative net returns for cotton fiber versus other
crops have encouraged this movement. Cotton has been a major cash crop and an important source of
foreign exchange in the United States for almost 200 years. Although the United States has usually been a
competitive exporter of raw cotton, other countries, many of them also cotton producers, are more
competitive as exporters of finished products. Since 1960, developing countries in Asia have become major
importers of raw cotton for their increasing domestic demand and for their growing textile industries
producing cotton fabrics and apparel for export. As a result, the United States has experienced a significant
textile and apparel trade deficit. Cotton lint is used in apparel, household, and industrial products. Cotton
accounts for about 64 percent of all fibers used in apparel, 25 percent in home furnishings, and about
11 percent of the fibers in industrial products. Americans used 76 pounds of fiber per capita in 1993,
which includes products produced by U.S. mills and the raw fiber content of imported textiles. Consumption
of manmade fibers in all uses totaled about 43 pounds per capita in 1993, compared with cotton at 29
pounds. The remaining 4 pounds were divided among wool, linen, and silk.