Discussion about cototn strategies

[Murad]

Dear forumdoshlar!I wante to share with you topics about cotton!As we know,cotton is the main cash crop in Uzbekistan. It accounted 85 percent of Total agricultural export and approximetly 13 percent of GDP. Cotton production prossesses are regulate by goverment, because cotton export is major source of of foreign exchange: it accounts for 1/6 of govermnet revenue. Wheat production is also controlled, beause bread is a major staple of local population. Recently, goverment has announced that cotton lint will be directed to the local textile prodcucers, while decreasing cototn export.
My question, how you can imagine the textile industry in Uzbekistan, while there are big textile producer and exporter countries, like China, Inida, Turkey? If you have any information about cotton manufacture pls share with us. The next question, cotton production is subsidized in developed countried which distorted world cotton market. They are keeping low prices of world cotton, which most suffering from this African countries. It is still not clear fro me why developed (USA, EU) subsidisng their cotton producers, giving them as we say money from their budget. What will happen, if they stop subsidizing their cotton producers?
Thank you for your time and opinions.
with respect Me.

[Delf]

What will happen, if they stop subsidizing their cotton producers?
Lots of people will lose their jobs, companies will go bankrupt unable to compete with low prices of developing and third world.
That is the reason why many agricultural products are subsidized in developed countries.

Delf.

[Tokugawa]

Correct. Same examples could be given from Japanese agricultural sector. The Japanese government keeps subsidizing agricultural sector and protecting by them high rate of customs taxes (or import tax) for certain cultures.

From one point of view this sounds inefficient, but this is done to:
1. Prevent total dependence on imported agricultural products
2. To keep social balance

Lots of people will lose their jobs, companies will go bankrupt unable to compete with low prices of developing and third world.
That is the reason why many agricultural products are subsidized in developed countries.

Delf.

[Gu_Ga]

I believe, Theory of COMPARATIVE ADVANTAGE is in place here, with some adjustments to fit into real life.

[Пушкарева]

One of possible solutions for developing countries might be to use the structuralists approach to protect their markets. However, there is a challenge from the part of industrialized countries who make official development assistance highly conditional demanding developing countries to free trade, remove tariffs and reduce taxes.

So, the issue for decision-makers is to be able to balance that out.


Dear forumdoshlar!I wante to share with you topics about cotton!As we know,cotton is the main cash crop in Uzbekistan. It accounted 85 percent of Total agricultural export and approximetly 13 percent of GDP. Cotton production prossesses are regulate by goverment, because cotton export is major source of of foreign exchange: it accounts for 1/6 of govermnet revenue. Wheat production is also controlled, beause bread is a major staple of local population. Recently, goverment has announced that cotton lint will be directed to the local textile prodcucers, while decreasing cototn export.
My question, how you can imagine the textile industry in Uzbekistan, while there are big textile producer and exporter countries, like China, Inida, Turkey? If you have any information about cotton manufacture pls share with us. The next question, cotton production is subsidized in developed countried which distorted world cotton market. They are keeping low prices of world cotton, which most suffering from this African countries. It is still not clear fro me why developed (USA, EU) subsidisng their cotton producers, giving them as we say money from their budget. What will happen, if they stop subsidizing their cotton producers?
Thank you for your time and opinions.
with respect Me.

[WASP]

Agricultural sectors have always been a matter of homeland security. They will always be subsidized to some extent, and it makes sense since no government wants to be entirely dependent (regardless of competency) on imports in this area (i.e. embargo, conflicts, disasters may create a shortage in exporting country, and so the importing country may have difficulty allocating the basic goods for its nation if it does not have any of its own. The US does not reserve millions of barrels of oil for no reason... )

[Murad]

the importing country may have difficulty allocating the basic goods for its nation if it does not have any of its own. The US does not reserve millions of barrels of oil for no reason... )[/quote]
Why do you think that it is difficult to allocate the basic goods for its nation, if the country does not have own agricultural product. I am not sure, but may be it would be profitbable to government not to giving subsidies to its prodcucers but bringing cheep agricultural commodities from outside?
what do you think?

[Пушкарева]

Then local farmers (ex: US) would bankrupt. As a matter of fact, rural population is mostly active in farming and comprise majority, that means that this majority will be very dissatisfied and angry and that might cause internal conflicts, protests, etc.

US cares abt its ppl, subsidizes farmers who export their cheap products to developing countries. In developing countries domestic agri-products become incompetable with the cheap US imports. As a result, farmers in poor countries impoverish even more.

I remember we saw one documentary in one of my classes, exactly on the topic. It was Jamaican case where poor farmers working manually (no advanced equipment) in their fields/farms with whole families and kids eventually cannot sell their products in their markets that are filled in with US subsidized agri-products (wheat, milk powder, etc). They showed then how the farmers had to pour tons of milk on the ground and throw their wheat as none buys it.


the importing country may have difficulty allocating the basic goods for its nation if it does not have any of its own. The US does not reserve millions of barrels of oil for no reason... ) Why do you think that it is difficult to allocate the basic goods for its nation, if the country does not have own agricultural product. I am not sure, but may be it would be profitbable to government not to giving subsidies to its prodcucers but bringing cheep agricultural commodities from outside?
what do you think?[/quote]

[WASP]

Why do you think that it is difficult to allocate the basic goods for its nation, if the country does not have own agricultural product. I am not sure, but may be it would be profitbable to government not to giving subsidies to its prodcucers but bringing cheep agricultural commodities from outside?
what do you think?

Please be more attentive. In my previous post, I mentioned that agricultural goods are a matter of homeland security (which means that the US does not rely too much on profitability on this sector, rather they care that these products are available to people at a reasonable price).

Let's talk about the oil (although it's not an agricultural product, it's also one of the commodities that's crucial for this society). Now, suppose that OPEC decides to put an embargo on oil exports to the US. What will happen in the US? It will be a chaos, oil prices will surge, which may lead to hyperinflation. That's the reason, why the US has millions of barrels in reserve to protect its nation from such incidents, at least temporarily (case in point: summer 2005).

The same thing applies to all of the basic commodities (wheat, corn & etc) that are essential for the people of any country to survive in any given year.