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| Senators Thanked For Farm Bill Effort In a statement, the NCC expressed deep appreciation for the successful efforts of Sens. Chambliss (R-GA), Lincoln (D-AR), Conrad (D-ND) and Harkin (D-IA) in guiding farm legislation through the Senate's Agriculture, Nutrition, and Forestry committee with strong bipartisan support. The statement noted the diligent efforts to craft a bill that includes real reform yet provides a basis for further action by the Senate. NCC Chairman John Pucheu complimented Sens. Chambliss, Lincoln, Cochran (R-MS) and Graham (R-SC) for including provisions that address many of the cotton industry’s priorities. A summary of the commodity provisions is being posted in the ’07 Farm Bill section of the NCC’s home page, www.cotton.org. As a brief overview, the bill: · Maintains an effective safety net for cotton, based on a non-recourse marketing loan of 52 cents, counter-cyclical payments triggered off of a target price of 72.25 cents and a direct payment of 6.67 cents; · Determines loan schedule premiums and discounts based on the four-year, moving average of the designated spot market regions, weighted by regional production; · Authorizes an economic adjustment program for textile manufacturers available from 8/1/08-7/31/13, at a rate of 4 cents/lb and requires that the assistance be used only for specific purposes, including modernization of facilities; · Authorizes storage credits for the ’08-12 crops at the same rate and basis as for the ’06 crop; · Maintains the ELS loan rate at 79.77 cents and continues the ELS competitiveness program; · Creates an optional “revenue-based” commodity program available in ’10 that replaces the marketing loan, counter-cyclical and direct payment program for producers who choose the option; and · Institutes significant reforms in payment limits including elimination of limits on marketing loan gains and loan deficiency payments; maintaining the limit on direct payments at $40,000 and lowering the limit on counter-cyclical payments to $60,000; eliminating the three-entity rule and providing for the direct attribution of payments; providing for spouse eligibility and liberalizes spouse eligibility under certain circumstances; and phases in a reduction in the allowed income levels under Adjusted Gross Income (AGI) means test but exempts those with 66.66% of income from farming, ranching or forestry operations. Pucheu said the package is balanced, contains several significant reforms and “deserves the entire Senate’s support.” The NCC, he said, now will work to urge Senate passage without damaging amendments. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| NCC Urges Senate Contact An “Action Alert” to NCC members from Chairman Pucheu noted that the ’07 farm bill is scheduled to be debated on the Senate floor during the week of Nov. 5. In anticipation of damaging amendments being introduced on the Senate floor, the Alert said, “it is imperative that the industry secure every vote possible from the Senators of Cotton Belt states.” Pucheu asked NCC members to call their Senators or their Senators’ agricultural legislative assistants as soon as possible and urge support for the committee bill and opposition to any damaging amendments – including specific opposition to a Grassley-Dorgan amendment on payment limits that likely is to be offered on the floor. Pucheu noted that the Senate ag committee bill contains true reform in payment limitations but the Grassley-Dorgan amendment contains ill-advised broadsides that will shrink US agriculture and harm commercial-size family farming operations. Pucheu also pointed out that Senate Agriculture Committee Chairman Harkin, when speaking to reporters following committee mark-up, stated, “I have every reason to believe it (the hard cap) will pass.” NCC members’ Congressional contact information is in the “Find Your Congressional Contacts” area at the bottom of the NCC’s home page, www.cotton.org or by calling the US Capitol switchboard at 202-224-3121. A list of Senate agricultural legislative assistants and other contact information, along with a summary of the Senate ag committee bill also can be found in the ’07 Farm Bill section of the NCC’s home page. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Sales, Shipments Steady Net export sales for the week ending Oct. 18 were 208,900 bales (480-lb). This brings total ’07-08 sales to slightly more than 6.0 million bales. To date, China is the largest buyer with purchases of 1.65 million bales, or 27% of the total. Mexico and Turkey rank second and third with 1.08 and 0.92 million bales, respectively. Total sales at the same point in the ’06-07 marketing year were approximately 4.1 million bales. Total new crop (’08-09) sales are 159,300 bales. Shipments were 179,000 bales, bringing total exports to date to 3.2 million bales, compared with the 1.5 million at the comparable point in the ’06-07 marketing year. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Panel Reviews Ag Disaster Conditions The House Committee on Agriculture heard about drought, flood, fire and other weather-related disaster conditions that are affecting US farmers. "Each year, farmers invest a great deal of time and resources into their crop, but all the hard work and money in the world can't guarantee a good harvest and one of the most unpredictable and important factors is weather," Agriculture Committee Chairman Peterson (D-MN) said. "Particularly with the drought in the Southeast, floods in the Midwest and wildfires in the Western states, agriculture producers have faced difficult conditions this year, and many are struggling as a result." Ranking Member Goodlatte (R-VA) said the Committee’s goal is to provide farmers and ranchers with an adequate safety net to ensure a steady food and fiber supply. “It is important that we fully understand the challenges facing the American farmer and rancher so we can gauge how effective our policies are in times of hardship," Goodlatte said. Among those presenting testimony were North Carolina Governor Mike Easley, Tennessee Dept. of Agriculture Commissioner Ken Givens and Georgia Farm Bureau President Zippy Duvall. Witness testimony is available on the Committee website: http://agriculture.house.gov/hearings/index.html. A full transcript of the hearing will be posted on the Committee web site in four to six weeks. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| CCI Delegation Updates Textile Leaders A Cotton Council International COTTON USA Executive Delegation hosted seminar sessions and meetings with textile industry leaders from Vietnam, Pakistan and Turkey on Oct. 15-19. CCI President Michael Adams led the delegation, which also included producers Rickey Bearden and Don Cameron; merchants Andy Weil and Joe Nicosia; cooperative marketer Grady Martin; Joe O’Neill of ICE Futures U.S.; and Marc Lewkowitz of Supima. Seminar sessions were held in Ho Chi Minh City for the Vietnamese industry, in Dubai for Pakistani textile industry representatives, and in Istanbul for the Turkish industry. About 80 local industry representatives participated in meetings in Ho Chi Minh City and Istanbul, and more than 30 textile industry leaders traveled to Dubai from Pakistan to meet with the delegation. Adams served as moderator for the sessions, and the delegation delivered presentations on US and world production supply and demand, US farm legislation and World Trade Organization (WTO) issues, US cotton’s sustainability, US cotton quality, futures and options, and Supima cotton. CCI also gave a presentation on its Supply Chain Marketing program in Dubai and Istanbul. Top leaders from the textile industry in each market attended the seminars and subsequent one-on-one meetings with the delegation. Risk management through the use of futures and options was of major interest in each location as textile leaders seek strategies to mitigate price risk in their operations. There were numerous questions on the relationship between the US cotton program and availability and price of cotton to world textile consumers, as well as any anticipated impact of ongoing WTO negotiations. The consensus of the textile representatives who voiced an opinion was that the extremely tight margins in Turkey and Pakistan will continue for at least the next nine months to a year, if not longer. In Vietnam, however, the textile industry is poised to continue its vertical ascent. In ’06, Turkey, Pakistan and Vietnam imported about 7.2 million bales of cotton of which 3.2 million are US bales. Mill use in these countries totaled 20.3 million bales in ’06. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| US Mill Use Drops According to the Commerce Dept., September (five-week month) total cotton consumption in domestic mills was 230.9 million pounds for a seasonally adjusted annualized rate of 4.85 million bales (480-lb). Last year’s September annualized rate was 5.20 million bales. The August (four-week month) estimate of domestic mill use of cotton was lowered by 4.80 million pounds to 178.3 million. The revised seasonally adjusted annualized rate of consumption for August is 4.78 million bales. This is lower than last year’s August annualized rate of 5.18 million bales. Preliminary October domestic mill use of cotton and revised September figures will be released by Commerce on Nov. 29. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Japanese Manufacturers Tour Cotton Belt US cotton leaders from North Carolina to California hosted 12 Japanese textile executives this month to inform them of US cotton fiber’s benefits in finished apparel. The CCI COTTON USA Fiber Education Tour participants represented 11 Japanese retailers and trading companies with a combined annual turnover of $17.7 billion for textiles. Japanese mills are expected to consume 600,000 bales of cotton in ’07, approximately half of that from the United States. This was CCI and Cotton Incorporated’s second year to: 1) heighten the Japanese retailers’ awareness of US cotton’s types/qualities and the industry’s technological advantages and 2) enhance their relationships with US exporters. The group toured the research and promotion headquarters of Cotton Incorporated in Cary, NC; NCC’s headquarters in Memphis; the USDA cotton classing office in Bartlett, TN; and saw production, ginning and classing in California’s San Joaquin Valley. Participants included the following top retailers and trading companies in Japan: Aeon Co., Ltd.; AIC Inc.; Akachan Honpo Co., Ltd.; Daimai Kokoku Co., Ltd.; Marubeni Corp.; Mitsubishi Corp.; Mycal Corp.; Nichimen Infinity Inc.; Sumitex International Co., Ltd.; Uniqlo Co., Ltd.; and Uny Co., Ltd. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Prices Effective Oct. 26-Nov. 1, '07
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