| In agriculture, a cash crop is a crop which is sold for money. The term is used to differentiate from subsistence crops, which are those fed to the
producer's own livestock or grown as food for the producer's family. In earlier times cash crops were usually only a small (but
vital) part of a farm's total yield, while today, especially in the developed countries, almost all crops are mainly grown for
cash. In non-developed nations, cash crops are usually crops which attract demand in more developed nations, and hence have some
export value.
In tropical and subtropical areas, coffee, cocoa, sugar cane, bananas, oranges and cotton are common cash crops. In cooler areas, grain crops, oil-yielding
crops and some vegetables predominate.
Prices for major cash crops are set in commodity markets with
global scope, with some local variation (called basis) based on freight costs and local supply and demand balance. A consequence
of this is that a nation, region, or individual producer relying on such a crop may suffer low prices should a bumper crop elsewhere lead to excess supply
on the global markets.
Issues involving subsidies and trade barriers on such crops have become controversial in discussions of globalization. Many developing nations take the position that the current
international trade system is unfair because it has caused tariffs to be lowered in
industrial goods while allowing for high tariffs and agricultural subsidies for agricultural goods. This makes it difficult for a
developing nation to export its goods overseas, and forces developing nations to compete with imported goods which are exported
from developing nations at artificially low prices. The practice of exporting at artificially low prices is known as dumping, and
is illegal in most nations. It was controversy over this issue which lead to the collapse of the Cancun trade talks in 2003, when the group of 22 refused to consider agenda items proposed by the European Union unless the issue of agricultural subsidies was addressed.
Agribusiness and the associated high-capital-investment industrial agriculture
it prefers, very often skews production towards cash crops and away from anything that is consumed locally or which cannot be
preserved, shipped and sold abroad. In addition it makes moral
purchasing difficult, as it is hard to tell what production practices might be involved in production of food remotely.
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