A good question. I would like to provide details about the cotton trade from a book that I found very well-researched. When you ask about the cotton trade in the occupied South, you also have to ask who provided the manpower?
Quoted from "A Politician Turned General: The Civil War Career of Stephen August Hurlbut"
General Stephen Hurlbut was relieved of his command of Memphis in April 1864. The following explains one of the reasons for this dismissal.
After seventeen months of command in Memphis, (General Stephen A.) Hurlbut had shown himself to be a harsh and arbitrary military ruler. . . . Hurlbut drew criticism mainly for his perceived corruption in the control of the cotton trade at Memphis—charges associated with reported instances of bribery and even extortion from vulnerable traders. Although he carefully concealed his participation in the cotton and extortion rings he himself had created, Hurlbut's tolerance of the practices of his subordinates allowed them to employ those rings to plunder Memphis, further complicating the problem of illicit cotton trading on the Mississippi. Moreover, Hurlbut incurred censure for the inconsistent and capricious practices---as traders and treasure agents complained of them---by which he regulated the movement of cotton through Memphis.
After surviving the possibility of a court martial, General Hurlbut was assigned to the department at New Orleans.
Ironically, and perhaps more significantly, Hurlbut's interest in operating another cotton ring sprang, in part, from Lincoln's ambivalence about, even seemingly encouragement of, smuggling at New Orleans. As in Memphis, a large and illicit exchange of contraband goods for cotton had developed in New Orleans; the trade had flourished even under the guns of the Union warships blockading New Orleans and other ports along the Gulf coast. . . . . An excessive amount of Northern bullion flowed to Europe to pay for the unusually expensive cotton abroad, particularly since the inception of commercial nonintercourse with the South. The Union blockade of Southern seaports, coupled with the Confederacy's cotton embargo of the North, the president explained, had seriously impeded the importation of much-desired Southern cotton into the North. . . . . Lincoln therefore urged Canby to exercise leniency toward Northern traders at new Orleans, making it possible for Northern food and clothing to be exchanged for Confederate cotton, theus simultaneously diverting Southern cotton from Europe, depriving the Confederates of foreign ordnance and relieving the scarcity of cotton and gold across the North.
. . . . Finally, the resourceful Robinson deposited his and Hurlbut's accumulated $23,000 in the First National Bank of New Orleans under the names of its president and cashier.
Regarding the manpower to farm the cotton fields.
However, in New Orleans in the fall of 1864, Hurlbut dutifully enforced Bank's policy of prompt payment of black plantation hands. In January 1864, Banks had issued an ordered that placed liens on planter's cotton and other staple crops to assure full compensation of black workers, because the planters often defaulted. Recognizing his responsibility for the 14,000 freedmen employed or supported by the Union army within New Orleans alone and also for the 35,000 blacks toiling under contract on some 1,073 plantation in Union Louisiana, . . . . On March 11, 1865, Hurlbut issued General Orders No. 23 which promulgated a new program for the disposition of the freedmen. Section 5 of his orders established the wage rates for black men, women, and small children of both sexes and requirements for food, clothing, shelter, medical care, and educational instruction for juveniles. . . . Although it granted to freedmen the right to choose their employers, Section 9 stipulated that a black worker would have to remain on a plantation for a full year. A worker who left a place of employment and returned later would forfeit all wages earned before leaving. . . . Thus theoretically at least, a planter could arbitrarily deny the efficiency or usefulness of even his most productive black hand and simply invoking Section 5 of Hurlbut's labor orders deprive that worker of fair compensation.
Many freedmen found themselves serving on the same plantation previously owned by their pre-War masters and possibly under the very same slave managers.