Economic, environmental and policy factors affecting cotton yields in the Texas High Plains

Since 1966, annual cotton yields in the Texas High Plains have shown a negative trend of about 10 pounds per acre per year. The purpose of this study was to determine which major variables affect cotton yields and what effect the variables have had on Texas High Plains yield trends. Data from twenty-five High Plains counties were analyzed, and yield and acreage equations were estimated. Variables found to be significant in the yield equations included rainfall variables, fertilizer price, and irrigation water available for use. Variables found significant in the acreage equations included government program provisions for acreage controls, diversion payments, and payment limitations along with expected price of cotton, production costs for wheat, and wheat-cotton price ratio. Fertilizer price was the only variable which showed a significant trend since 1966. Across the Texas High Plains region, the average percent of yield trends not explained was 38% for irrigated cotton and 52% for non-irrigated cotton. From the study, it was concluded that acreage harvested had no direct impact on cotton yields in the Texas High Plains, and input costs had a significant effect on declining yields. It was recommended that a different approach to determining causes for declining yields in the Texas High Plains was needed.