Cash crop

A cash crop, also called profit crop, is an <a href="/facts/Agriculture/TGztqzJs">agricultural</a> <a href="/facts/Crop/JoQKR5R8">crop</a> which is grown to sell for profit. It is typically purchased by parties separate from a <a href="/facts/Farm/EsIveRWU">farm</a>. The term is used to differentiate a marketed crop from a <a href="/facts/Staple_crop/GNo3putV">staple crop</a> ("subsistence crop") in <a href="/facts/Subsistence_agriculture/Djjy4FH3">subsistence agriculture</a>, which is one 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 <a href="/facts/Developed_country/sqwTSDHm">developed countries</a> and among <a href="/facts/Smallholding/uvmaq8zy">smallholders</a> almost all crops are mainly grown for revenue. In the <a href="/facts/Least_developed_country/8Ss2N44w">least developed countries</a>, cash crops are usually crops which attract demand in more developed nations, and hence have some export value.
Prices for major cash crops are set in international <a href="/facts/Trade/S13U8JKr">trade</a> markets with <a href="/facts/Global_markets/9vkvrb0J">global scope</a>, with some local variation (termed as "basis") based on <a href="/facts/Cargo/0aDk22Yl">freight</a> costs and local <a href="/facts/Supply_and_demand/KprL1fvc">supply and demand</a> balance. A consequence of this is that a nation, region, or individual producer relying on such a crop may suffer low prices should a <a href="/facts/Bumper_crop/BfT41041">bumper crop</a> elsewhere lead to excess supply on the global markets. This system has been criticized by traditional farmers. <a href="/facts/Coffee/Q4Ko2C7I">Coffee</a> is an example of a product that has been susceptible to significant commodity futures price variations.

Cash crop open-in-new

Cash crop