Federation of Southern Cooperatives
Land Assistance Fund

U.S. Cotton Program & Black Cotton Farmers in the United States: Part Two
Findings and Analysis of Interviews with Black Cotton Farmers

By Jerry Pennick* and Heather Gray**
Federation of Southern Cooperatives/Land Assistance Fund
Research conducted in 2006
Copyright 2006
(For a word copy of the study click here)

There has been much debate about farm policy in the United States and its impact on farmers in Africa, Asia and South America, with a particular emphasis on the consequences of the USDA’s subsidy program. Cotton has recently been the primary target. There have been assumptions made about subsidies - that they lead to a glut on international export markets of U.S. cotton and of American farmers reaping enormous profits from the U.S. subsidies at the expense of farmers elsewhere.

The problem with this scenario is that there had not been an effort to go to small farmers and ask what they thought about the cotton program and what might happen to them if it ends or changes radically. There certainly has been no effort, until now, to ask Black cotton farmers in the United States what they thought about the program.

This research project included interviews with Black cotton farmers in the southern United States on three primary issues:

  • The level of their financial dependency on the current US cotton farm program:
    • Are the subsidy payments helpful?
    • Are the subsidy payments needed?
  • What they would do in the event that the program ends:
    • What crops would they grow?
    • Would they continue growing cotton?
  • What they thought about the globalized markets being implemented through the recent international trade policies.

According to the latest USDA census (2002) there are 408 Black cotton farmers in the United States. The census is not necessarily an accurate count of farmers but it is the best statistical information available. The Black cotton farmers are located in the following states:

Cotton Farmers in the United States
(2002 Agriculture Census)

State
Alabama        
Arizona           
Arkansas       
Georgia          
Florida               
Mississippi
North Carolina
South Carolina
Texas                
Louisiana     
Virginia           
Tennessee   
Total                          

Number
22
1
23
65
6
140
36
9
27
54
5
20
408

Methodology

To conduct this study the Federation/LAF chose to interview a percentage of farmers in the states that recorded the largest group of Black cotton farmers in the last agriculture census and where the organization has offices.  The states included Alabama (N=22), Mississippi (N=140), Georgia (N=65), Louisiana (N=54) and Arkansas (N=23).  Approximately ten percent of the cotton farmers were interviewed per state in Mississippi, Georgia and Alabama where the Federation has offices. We chose also to include at least one farmer from Louisiana and Arkansas where the Federation does not have offices but are states within the critical cotton country – the Mississippi Delta. The Federation staff conducted the interviews.

Twenty-eight interviews were conducted with the following number of farmers per state: Alabama (N=2 - 9% of 22), Mississippi (N=16 – 11.4% of 140), Georgia (N=8 - 12.3% of 65); and one farmer in Louisiana and Arkansas. All farmers interviewed had an established cotton base. Most interviews were conducted by phone, however some were conducted in person.

This was not a scientific random sampling. It was an exploratory study to assess the attitudes of farmers across state borders to then stimulate ideas for additional discussion and much needed research on trade policies and their impact on farmers of color in the U.S. and the developing world. To provide diversity and as much objectivity as possible, the farmers, selected by the Federation staff, were in different counties in each state. As a result the farmers interviewed were not clustered and offered differences in terms of local policies and relationships with USDA county officials.

Findings and Analysis

The findings are primarily averages and/or percentages obtained from the data. From this basic information, however, we can identify some trends. Given the size of the sample, we cannot legitimately engage in further meaningful statistical analysis. The findings below, therefore, reveal a preliminary and exploratory description of the Black cotton farming population in these southern states.

The findings and analysis are divided into four major areas based on the survey and commentaries from respondents. These are: (1) Demographic Information (2) General Farming Information (3) Cotton Program (4) International Trade Policies, and (5) General Comments about the Cotton Program. This will be followed by a summary of the findings and analysis.

In this analysis some comparisons will be made to a 1999 study conducted by the Federation entitled “Assessment of Risk Management Tools in the Black Farming Community.” 338 black farmers from across the southeast were interviewed in the 1999 research project. The farmers in the study were of the general farming population some of whom had livestock and were also growing a variety of crops from commodities to vegetables. The comparisons will be made primarily to demonstrate the difference between the general black farming population and black cotton farmers in this study.

(1) Demographic Information

  • all the respondents were male;
  • the average age of the respondents was 54 with the youngest being 30 and oldest 76;
  • 73% of the respondents were married;
  • 52% had a least one child living at home;
  • Education: 89% of the respondents had completed high school; 47% had attended college of which 24% were college graduates and12% had gone to but not finished graduate school;
  • 28 was the average number of years farmed by the respondents with the least being 3 years and the longest time farming being 53 years;
  • 42% of the respondents said that farming was their primary income;
  • 35% responded said that they had an off-farm job;
  • 81% stated that they were the major wage earner for their family.

African-American cotton farmers appear to be a stable farming population. Most of the farmers in this study were younger than those in our previous research. For example, 50% of the respondents in this study were under the age of 52 and in the 1999 study only 31% of the respondents were between 20 to 49 years old and 69% were age 50 and older.

They are fairly well educated with 89% having finished high school and 47% having gone to university. Compared to these cotton farmers, in the 1999 study fewer of the respondents had completed high school (36%) or had gone to college (35%).

These farmers also had a greater stake in their farming enterprise in that only 35% said they had an off-farm job, which is low compared to the 1999 study. None of the respondents who stated that farming was their primary income had an off-farm job. By comparison, in our 1999 study mentioned above, a significant 72% of the respondents reported having off-farm jobs.

(2) General Farming Information

  • 544 was the average number of acres farmed
  • 147 was the average number of acres owned
  • 92% of the respondents said they leased land for farming
  • 422 was the average number of acres leased
  • 85% of the respondents said they had a “crop only” enterprise
  • 15% said they had a “crop and livestock” enterprise.
  • 80% stated they had applied for a Farm Service Agency loan in the past 5 years
  • 62% stated that had received a loan in the past five years (In the 1999 study, 20% of the farmers reported receiving an FSA loan in the past five years.)
  • 92% reported growing at least one other commodity crop in addition to cotton

Program Crops Grown Other Than Cotton

Crop (Number of Respondents)  

Corn 32% (N=9) 
Soy 46% (N=13) 
Peanuts 21% (N=6)
Wheat 4% (N=1)
Grain Sorghum (0)     

Average acreage 

37
93
30 

0  
   

# In Gov’t Program

29% (N=8)
61% (N=17)
21% (N=6)
29% (N=8)
0

While most farmers tend to lease land for their farming operation, a rather significant 92% of the cotton farmers were leasing land to farm which generally far exceeded what they owned. One farmer, for example, owned one acre of land and leased 300 acres to farm; another owned 200 acres and leased 1,400 acres.

The cotton farmers in the sample are largely not diversified beyond other commodity crops in their farming operation. A sizable 85% stated that they have a “crop only” enterprise and only 25% noted they were growing vegetable crops. Rather interestingly, however, 92% of these farmers reported growing other commodity crops in addition to cotton.  Half of the farmers stated that they were also in the soy commodity program which is not surprising given it is a rotational crop for cotton.

(3) Cotton Program

  • 100% had a cotton base
  • 371 was the average acreage for cotton with the least amount being 50 acres and the most being 4,000 – two farmers in the survey grew no cotton in the past year
  • 79% stated that they did not have irrigation
  • 599 was the average number of bales produced in 2004; 578 bales was the average in 2005
  • Marketing Options
    • Contract                                    11% (N=3)
    • Broker                                       18% (N=5)
    • Contract/Broker                        36% (N=10)
    • Other                                         11% (N=3) (marketing association)
  • 86% of the respondents stated they were “satisfied” with their marketing arrangement
  • 92% of the respondents stated that the cotton program was important to them
  • 56% of the respondents stated they would continue growing cotton even if the cotton program ended
  • 50% of those responding said they would consider growing an alterative crop in the event that the cotton program ended
  • Income
    • $146,652 was the average annual income, ranging from  $19,000 to $2,000,000
    • On average 60% of the income came from farming, ranging from 20% to 100% (In the 2001 study, 42% said farming was their principle income.)
    • On average 46% of the income came from cotton
    • On average 17% of the income came from the cotton government program

Black cotton farmers grow their cotton on substantial acreage though they are generally considered limited resource farmers. The cotton production acreage of these farmers ranged from 50 to 4,000 acres with the average being 371 acres. It is significant, however, that the majority of the farmers (79%) did not have irrigation.

Most of the farmers utilized both a broker and/or contracted their cotton for sale. Interestingly, 86% of the respondents were “satisfied” with their marketing arrangements. Their comments were revealing. Some said that while they were satisfied, they added that they didn’t make enough money. On the whole, however, the farmers said they were pleased and that the brokers, marketing associations or other methods for marketing were beneficial in seeking the best price possible. While they were pleased with the marketing efforts, some also realized, after some probing, that the cotton price itself was not adequate and there was not much they or others could do about it.

  • I book approximately 60% of my soybeans and cotton.
  • My corn crop is only used to feed my cattle. 
  • I’m satisfied because I receive a price higher than most farmers.
  • I have been contracting for approximately 10 years and I receive payments above the average market price. 
  • I’m satisfied because I have been marketing my crop in this way for over 25 years
  • I only farm a small acreage of cotton & soybeans and am satisfied with the marketing of my crop. 
  • I book approximately 50% of my cotton bales and 50% of my soybeans.
  •  I am very familiar with contracting and brokers whom I have dealt with over 20 years.
  • But don’t make enough money – I market it myself but I do contract some cotton.  
  • I book approximately 80% of my crop above market price. 
  • I have received a good price while booking my cotton and soybeans. 
  • They’re professionals (marketing association) – they give us a fair price –they do just as well as I did when I was marketing myself.
  • Yes, I’m satisfied but don’t make enough money – I market it myself but I do contract some cotton.

Farmers who were not satisfied said:

  • Probably need to book more of my crop because of low prices.
  • I’m not satisfied, but there’s nothing you can do.

The government cotton program was important to farmers in that 92% stressed this point. The payments helped some of the farmers pay for their seeds to then allow for an early crop; make payments on their FSA loans; pay for leasing the land; the payments add to the overall income because “prices are low and production is so high”; and help to cover the cost of production generally. They said:

  • Due to me booking a large percentage of my crops, I need these payments for early planting and also to substitute for low market prices.
  • These payments are very important because I can prepare my land on time when I receive my first payment during January or February.
  • They help with my payment leases and it also helps me to begin planting earlyThey are important because they help supplement my overall income.
  • Without these payments I could not afford to produce a crop.
  • Need it to begin early planting of cotton and soy beans (and the payments help to do this).
  • They are important because of low prices for cotton and soybeans.
  • They are important because I can use some of the funds to pay rent and to begin the planting season.Important because early planting improves yields and cash flow.
  • If they cut payments out a lot of us will quitEvery little bit helps – last year it helped pay off my loan – otherwise I would have been way behind in paying my money back.
  • The direct payments come at the time I need my money more when I start planting – helps at getting fuel and stuff – the other payments come in the FallVery important because the price of commodities is so cheap and production is so high – it’s called Price Support.
  • Helps you get something for the cotton – helps you to sale cotton for up to 72%.

Nevertheless, in spite of the fact that they appreciate the cotton program payments, a majority (56%) of the farmers stated that they would continue growing cotton in the event the government program ended. Regarding continuing to grow cotton, farmers said that they had invested too much money into cotton, particularly in terms of equipment, to give it up; others said they would continue, but might cut back on production. Some of the comments from farmers on the continuation of cotton production are as follows:

  • I have invested a lot of monies into cotton equipment such as pickers, etc.
  • Because I have been farming cotton for over 40 yearsI’m very young and would like to enlarge my cotton acres.           
  • Even if the government payments stopped, I would continue producing but may lower my acreage.
  • I would continue to produce cotton, but on a smaller scale Because of the joy of it.
  • I like the income in the winter time when I get it – it would be hard to quit- I might cut back a little bit.I’m not satisfied, but there’s nothing you can do.

For farmers who said that they would not continue growing cotton if the cotton program ended, the comments ranged from: the importance of the government payments for making some money, at least, in cotton production; that there would simply not be enough money to continue; to being older and not healthy.
Prices are already at (their) lowest over the past 10 years.

  • You couldn’t make no money – that’s (e.g. cotton payments) how you make a little money out of cotton.
  • Some people are growing peanuts instead of cotton for no money.
  • Couldn’t afford it – couldn’t take the risk – it would be unacceptable.
  • High cost to produce and low prices for commodities.
  • Probably would not have enough money to continue farming.
  • I probably would stop because of my age and health.
  • I would not be able to make a profit because of high operating costs and low prices for products.
  • I probably would not (continue) because I depend on these payments to make a crop.
  • Would not make a profit.

It is also interesting to note that 50% of the respondents said they would consider growing an alternative crop in the event the cotton program ended. The vast majority (72%) said they would consider growing another program crop such as grain sorghum, corn, soybeans, rice or wheat. Others said they would consider including, in their production mix, vegetable crops such as okra, peas, greens and watermelon in addition to the commodity crop.One farmer said he would try to grow vegetables exclusively  “(I would) try to grow vegetables – but you need to have a contractor before you grow them – have to have them sold before you grow them.” Another farmer said he  “would start growing more vegetables and get out of cotton.”Comments from those who would not consider growing an alternative crop were:

  • (I would) probably not (grow another crop).
  • (1) need that support payment to produce a crop and to pay family living.
  • No – would get out of farming – if it gets any more risky than it is now I would get out – we could do something – would do something.

(4) International Trade Policies

  • 58% of the respondents stated they knew about NAFTA (North American Free Trade    Agreement
  • 58% of the respondents said they knew about CAFTA (Central American Free Trade Agreement)
  • 71% of the respondents were familiar with the WTO
  • 53% of the respondents thought that the international trade policies had an impact on their agricultural production

Most of the respondents were familiar with international trade agreements such as NAFTA (58%) and CAFTA (58%) with the World Trade Organization topping the list at 71%. In spite of this, only 53% thought that the agreements had an impact on their agriculture production. But there was an abundance of opinions regarding the trade agreements.

Many felt the agreements were not helpful to American farmers. They said that the farmers in other countries were not under the same regulations as those in the United States. They said, for one, that farmers in other countries could use more chemicals than American farmers and can access cheaper labor. Along this line, some farmers were concerned that the health of Americans was vulnerable due to imported foods and that, basically, no one knew how food in other countries was grown. Food safety, therefore, was a concern. Importantly, the other perception is that other countries, through trade agreements, are driving down the prices. Many of the farmers also thought that China was having a major impact on trade in the United States and the world market. Below are some examples of comments regarding the impact on production from the trade agreements:

  • (The trade agreements) drive prices down.
  • (Farmers in other countries)… use a lot of chemicals that we can’t use. If we can’t use (them) they shouldn’t be able to either.
  • Because the world market drives the market up or down depending on production – peanuts in other places are substandard to what we grow here.
  • A lot of the trade, as with cotton, they can sell it so cheap – it’s driving the prices down – I’m almost getting less than my father.
  • China has the biggest impact on trade.

(5) General Comments about the Cotton Program

At the end of our survey the respondents were asked if there was anything else they would like to add about the government’s cotton program. There were, as might be expected, considerable comments shared by the respondents, along with recommendations.

Many farmers expressed frustration at what they perceived as discrimination regarding the government programs services for minority farmers. There was also concern about the benefits of the farm program accrued to the largest farmers with relatively few benefits to smaller farmers.

  • The rich get richer while minorities receive a small portion from governmental subsidies.
  • I think that the government is unfair when it comes to establishing a base for minorities. Whites receive higher payments even though my land is connected right next to his. (And this in spite of the fact that) I normally produce a higher yield than most farmers in the county.
  • I lease land from a white (owner). His payment yields were based on a 95% lbs base. However, FSA only gave me a 75% base payment.
  • The government should investigate those agencies on how the price support programs are determined. Whereas whites get a high base on land, when blacks lease the same land their payments are lower.
  • There should be a limitation on how much the larger farmers should receive from government subsidies.
  • The FSA loan program states that land in inventory will be available for minority farmers. However, inventory land is only being sold to the highest bidders on courthouse steps.

Some farmers complained about the implementation of the program in terms of untimely payments and that these payments should be increased. This is often coupled with the fact that commodity prices are so low and with the production costs increasing, that farmers expressed concern that it was hard for the farmers to make any money with the present loan rates. Some of the concerns also related to FSA loans, which some farmers complained came too late for their planting. One farmer said, “For the last five years I have turned in my application to FSA during January and February. However, my loan (is not) approved until late May or June.” Some farmers stressed that the commodity program payments helped cover some of the initial costs until the loan money was available. Some of the comments regarding all of the above were:

  • Because of high cost to produce cotton crop and prices received for commodities are decreasing. The government should increase the support payments per acre.
  • The government should pay all payments at the beginning of the year so that when our (FSA) loans are received late, we will be able to withstand until funding is available.
  • One bag of round-up ready Bollgard cotton costs me $40 and it only plants 8 acres – it costs me $30,000 for my cottonseeds.

Virtually all the farmers stressed the importance of the commodity program and mentioned how cotton is a good crop for small farmers. They said:

  • If they discontinue there will be a lot of farmers hurt. A lot of young are going away from farming. (Expenses are too much) it’s $2.30 for diesel now  - we used to get it for 45 cents or 50 cents.
  • It’s been a pretty good program – it offers a little extra income.
  • Try to keep it (the cotton program) because I don’t think we could make it without it – it’s a good crop for a small farmer like me – it’s a forgiving crop. It’s good for growing in drought because with a drought cotton will drop everything but it will still make another crop in the same year. But that’s not true with corn and soybeans. It’s good for farmers without irrigation.
  • (The cotton program payments) are important because it’s hard to make it without them – (it) costs a lot of money (to farm and the) farm payments are important to any farmer in America.

One of the cotton farmers made lengthy comments about the program and its impact should the government end the commodity subsidies. He warns of the “government getting out of agriculture” and handing over agriculture to the whims of corporate America. If this happens, he says, consumers will be vulnerable as there will be no control over the price of food and farmers will be vulnerable as there will be no opportunity to control the price of commodities to benefit farmers. He is also concerned about the fact that cotton mills are no longer available in the United States, which, he says, were his most reliable customers. He wisely remarks that when his customers are hurt, he is as well. He stated that food prices will accelerate if the government gets out of agriculture and there would be little consumers could do because they have to eat. He compared this to the present rise in diesel fuel. Farmers have to use diesel fuel so they purchase what they can get even though the prices are higher and there are no other choices right now.

He goes on to explain how the cotton program helps but is not always covering the cost of production and that the input costs are increasing, making it harder to make anything in farming which would be exacerbated without the commodity payments.

 More of his comments are shared below:

Without the farm program … it doesn’t make sense to farm….

My take on this is that we’ve got folks up there (in Congress) that represent me good and bad … I know domestic cotton mills here have gone out of business – if it hurts my most reliable customers (i.e. the mills) it hurts me. The domestic mills are a lot more reliable. They’re the ones that you could use and they were here.

It’s been the design of the government since the 1940’s to support corporate agriculture  – with the round-up ready it’s great for us and great for corporate agriculture – one group could easily manage 50,000 acres – until all we basically need to do is to plant it – watch it - and they harvest it. … With the technology and equipment we can do it (all with just a few people).

In order to control the people you need to control the food - the same thing with us (farmers). Once farming gets into the hands of corporate America…they would start controlling us (farmers) more – would be the same with food. If the government gets out of farming, then the corporate America gets into farming and the consumers get into trouble.

I understand being independent. If we have to put the family farm out of business in favor of the corporate farm in Africa then we don’t care about independence. With the family farm we want to do a good job – not only do we sell it (our products) we use it ourselves. We want to make sure it’s safe – we need to keep the family farm viable….

When the government gets out of farming and lets the farmer go, the cost of inputs would go up. It will continue driving up the prices – once the family farm is out of business they will make all the prices go up. Corporate America is not as independent as the family farmer – they will only produce what they can …for the market – whatever it takes to get their return that’s what they’ll do. Corporate America will produce only enough soybeans and for the price to be whatever it can to make a profit – we would be like the chicken farmers who largely work under contract. (It) would be the same with us – they would be paying our salary – we would be making them rich – would be good for us (large farmers) but bad for the consumer.

Summary: Findings & Analysis

This preliminary study found that Black cotton farmers are a fairly stable farming sector. They tend, however, not to be as diversified in crop production as with Black farmers the Federation generally encounters. Like many other commodity farmers across the country, they are basically devoted to their cash crop; in this instance it is cotton. Like most farmers, as well, they have largely been in farming all of their lives.

Leasing land: These farmers lease an enormous amount of land for their cotton production. While we did not ask the question directly as to whom they loaned from, we think that much of the land leased by the cotton farmers is from other Black landowners. We frequently see this trend in the Black farming community and have no reason to believe it would be different with this group. Because of this arrangement the income and assets in the Black community are maintained and supported.

Making a living with subsidy assistance: These cotton farmers are making a living on their cotton crop, but recognize the importance of the subsidies in order to do so. The end of subsidies would create a dilemma for most of them. Their farming decisions would be altered considerably. The decision whether to continue farming was also a consideration for some given the possible end to the subsidies.

Black cotton farmers rely on subsidies. Many said it would be hard to make it without them. For some, the direct payments help with the purchase of seeds, inputs and other preparation. Many of the payments go directly to the Farm Service Agency (FSA) to pay off their loans.

They told us that with the subsidies their cost of production is covered, but just barely. They were pleased with their marketing arrangements on the whole, but some realized that the price was not good in any case and there was not much they could do about that. It was the combination of all of these that helped them stay in farming. It was the subsidies combined with the sales that made the difference.

Interestingly, some of the respondents said that they would continue growing cotton in the event of the end of subsidies because of their past investments and one farmer said because of the “pure joy of it”.

The Price of Cotton Making the Difference: Some farmers were asked as an aside “if the price for cotton was better would they need the cotton program”. In virtually every instance they said that a fair price would solve the problem and the cotton subsidies, therefore, would not be necessary.

Growing crops other than cotton: Many of the farmers received subsidies from other program crops, in addition to cotton. Many said that if the cotton subsidy ended they would either get out of farming because it would be impossible to make it otherwise; or others said they would consider planting another commodity crop such as corn or soy.  Some said they would consider growing vegetable crops.

Racism in agriculture: Racism was another issue that was spontaneously mentioned by some farmers. Some said that their cotton base was not fair and that “similar” neighboring white farmers received a higher base. One farmer said that this was the case even though he had routinely grown a higher yield.

International trade implications: Some of the respondents complained about international trade agreements that offered opportunities for farmers in other countries to apply chemicals and use practices that they could not in the U.S., which they said was not fair. Cheaper labor in other countries was also an issue. Some blamed other countries for the problems they experienced. One farmer said that we should stop international trade altogether and “grow our own crops for our people”.

(Part Three of the Cotton Study is "Recommendations for Agriculture Policy
Based on the Research Findings of Interviews with Black Cotton Farmers")

BIBLIOGRAPHY

Agriculture Adjustment Act (AAA)  - U.S. Senate Agriculture Legislative Archives (on-line)

Cobb, James -  The Most Southern Place on Earth: The Mississippi Delta and the Roots of Regional Identity (1992) Oxford University Press

Culver, John C. & John Hyde - American Dreamer: A Life of Henry A. Wallace (2000) Norton

Goldschmidt, Walter – As You Sow: Three Studies in the Social Consequences of Agribusiness (1978) Allanheld, Osmun & Co.

Goldschmidt, Walter – “What If???” (1993) – (Source: Al Krebs – “Agribusiness Examiner” archives)

Gray, Heather and Jerry Pennick -  “Assessment of Risk Management Tools in the Black Farming Community” (2001), Federation of Southern Cooperatives/Land Assistance Fund (a study funded by the USDA’s Risk Management Agency)

Krebs, Al - The Corporate Reapers: The Book of Agribusiness (1992) Essential Information

Krebs, Al – “Agribusiness Examiner” article archives - 2000, 2002

Lewis, E.E. - Black Cotton Farmers and the AAA, Opportunity, Journal of Negro Life, National Urban League publisher (March 1935)

Ray, Daryll - “Weekly Agriculture Policy Columns”, University of Tennessee

United States Agriculture Census (2002)

We especially thank the following for lengthy discussions and guidance in better understanding the government commodity programs as well as agriculture philosophy and history: Rhonda Perry, farmer, Missouri Rural Crisis Center; Dr. Daryll Ray, agriculture economist, University of Tennessee; Harwood Schaffer, Ph.D. candidate in Sociology, University of Tennessee.

     * Jerry Pennick is the Director of the Federation/LAF's Land Assistance Fund
**Heather Gray is the Director of Communications of the Federation/LAF

Federation of Southern Cooperatives/Land Assistance Fund
www.federation.coop
404 765 0991


 

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