Cotton's Week: January 18, 2008

Cotton's Week: January 18, 2008

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Tobacco, Cotton Programs Consolidated

USDA Agricultural Marketing Service (AMS) Deputy Administrator Darryl Earnest has advised that effective Jan. 20, the consolidation of the tobacco and cotton programs will form the new “AMS Cotton and Tobacco Programs.”

The Fair and Equitable Tobacco Transition Act of 2004 eliminated tobacco price supports and quotas and mandatory inspection and grading as well. As a result of the greatly diminished services required by tobacco, AMS decided to merge the Tobacco Program with the Cotton Program.

In his letter, Earnest said, “The consolidation of the two programs will in no way change the type or level of quality services offered to both industries….service, activities, budget, and fee structures will remain separate between the two program areas.”

Earnest will serve as deputy administrator for the cotton and tobacco programs.


Hearing Slated for Ag Secretary Nominee

Sens. Harkin (D-IA) and Chambliss (R-GA), the chairman and ranking member, respectively, of the Senate Committee on Agriculture, Nutrition and Forestry, announced a nomination hearing for former North Dakota Governor Edward Schafer. The Committee will examine the nomination of Governor Schafer to be the Secretary of the USDA Secretary.

The hearing is set for Jan. 24th at 2 pm in Room 328A of the Russell Senate Office Bldg.



Economic Growth Package Sought

President Bush has asked Congress to work with him to enact an economic growth package as soon as possible to keep the US economy growing and creating jobs.

According to a White House statement, the President has asked Treasury Secretary Henry Paulson to lead the Administration's efforts to forge an agreement with Congress to deliver this needed boost as quickly as possible. It stated that after careful consideration and discussion with Congressional members, the President has concluded that action is needed to protect the health of the economy as a whole. The President's advisors and many outside experts expect that the US economy will continue to grow over the coming year, but at a slower rate than enjoyed for the past few years - and there is the risk of a downturn. A growth package, it said, can help ensure that consumption and investment is sufficient to protect the health of the broader economy.

The announcement said that Congress should use certain principles to guide its deliberations on a growth plan, including that it should: 1) be big enough to make a difference in an economy as large and dynamic as ours; 2) consider that a package that is about one percent of GDP would be sufficient to provide a boost to the economy; 3) be built on broad-based tax relief that will directly affect economic growth, not Federal spending that would have little immediate impact on the economy; 4) be temporary and take effect right away to get help to our economy when it is needed most; and 5) not include any tax increases.

The announcement also said that for the package to be effective it must: 1) include tax incentives for American businesses - including small businesses - to make investments in their enterprises this year and 2) also include direct and rapid income tax relief for the American people.

The President also has asked Congress to level the playing field for American workers and farmers by quickly approving free trade agreements with Colombia, Panama and South Korea. Last month, President Bush signed legislation approving the US-Peru free trade agreement, and he is asking Congress to approve these three remaining agreements. He also is asking Congress to reauthorize and improve the Trade Adjustment Assistance program to help workers affected by trade.


Schwab Sees Critical Period Ahead

US Trade Representative Susan Schwab said the upcoming few months will be critical for reaching an agreement on world trade.

"We are in a critical few months," she told reporters after addressing the US Chamber of Commerce.

According to a new roadmap agreed by all WTO members, the chairmen for agriculture and industry talks should issue revised draft proposals in late January or early February.

In her speech to the Chamber, she said in the next few months each member of the World Trade Organization (WTO) will "face a fork in the road: whether or not the ranges and flexibility within the texts produced by the negotiating chairs will be the playing field upon which all members negotiate."

She listed agriculture, goods and services as the three areas of market access that are at the core of the talks and key to a breakthrough.

"We seek an agreement where WTO members can become passionate about an agreement that will generate economic growth, namely, new trade flows derived from real new market openings," she said.

The Doha Round trade talks have missed quite a few deadlines since they were launched six years ago with the aim to promote development through reducing trade barriers. WTO members have pulled themselves together for a new flurry of intensified negotiations since early September last year, trying to narrow their differences on reducing agriculture subsidies, tariffs and industrial trade barriers.


NCTO Develops Customs Fraud Reporting Tool

The National Council of Textile Organizations (NCTO) announced that it has begun an online customs fraud reporting system and has distributed new customs fraud reporting tools to its member companies and the public at large.

NCTO is urging anyone who is aware of customs fraud in textiles and apparel to utilize the forms.

The new tools include a one page form that can be filled out online and sent electronically to NCTO on a confidential basis. NCTO will then forward the information to US Customs and can, if requested, delete the reporter’s name. All information will be held on a business confidential basis.

The new forms are available at www.ncto.org under “Report Customs Fraud.”

The forms were developed in consultation with the US Customs and Border Protection and are designed to streamline the reporting process and provide more detailed information to that agency.

The new effort was undertaken after increasing reports of fraud being reported by NCTO member companies in the CAFTA/NAFTA region.



NCC Annual Meeting Deadlines Draw Near

Jan. 25 is the deadline to pre-register for the NCC’s ’08 Annual Meeting to be held at the Peabody Hotel in Memphis on Feb. 7-11. Online meeting pre-registration is available by going to http://www.cotton.org/news/meetings/amreg/.

The NCC group block at the Peabody Hotel is sold out. Contact the NCC’s Meeting/Travel Department at 901–274–9030 for hotel room assistance.

Discounted air fare on American and Northwest airlines is available through Travelennium, by calling Mary Saemenes at 800-844-4924, ext. 318.

NCC Chairman John Pucheu will address the Feb. 11 general session along with Gloria Borger, senior political analyst for CNN.

Among other important convention sessions will be the Feb. 8 American Cotton Producers meeting, which will include a presentation from NCC’s Economic Services regarding their planting intentions survey results. On Feb. 9, the delegates will hear the NCC’s Economic Outlook and a Cotton Incorporated report from Berrye Worsham. The Saturday luncheon will feature Tom DeFrank, veteran political journalist and author.



First Consultant Forum Successful

More than 200 attended the inaugural Cotton Consultants Conference, held last week at the ’08 Beltwide Cotton Conferences (BWCC) in Nashville.

The session’s general conferences featured reports on variety selection tools, considerations for insect management, and herbicide resistance management strategies. Participants in the breakout sessions engaged in roundtable discussions in all cotton production-related disciplines.

In addition, the eXtension cotton web site - http://www.extension.org/ - was formally launched. The site, which includes a search engine as well as an "ask an expert" feature, offers university information on cotton production and management from across the nation. The cotton section of that site at -- www.extension.org/cotton_industry -- has updates on timely topics ranging from varieties/biotechnology to defoliation/harvest management as well as specific information such as state Extension pest management recommendations.

Also unveiled at the BWCC was “First 40 Days and Fruiting to Finish,” -- expert recommendations of Best Management Practices for an efficient and cost effective cotton production system. That publication is on the NCC’s web site at: http://www.cotton.org/tech/physiology/index.cfm.

’08 BWCC attendees will be able to access recordings of select conferences’ presentations via the Confex Podium Service at a web site address that will be announced soon. The ’08 conference proceedings are scheduled to be available online by late May. The ’09 BWCC will be held Jan. 5-9 at the Marriott Rivercenter in San Antonio.


Sales Surge, Shipments Steady

Net export sales for the week ending Jan. 10 were 539,000 bales (480-lb). This brings total ’07-08 sales to approximately 8.8 million bales. Total sales at the same point in the ’06-07 marketing year were approximately 6.6 million bales. Total new crop (’08-09) sales are 229,700 bales.

Shipments for the week were 191,800 bales, bringing total exports to date to 5.6 million bales, compared with the 3.5 million bales at the comparable point in the ’06-07 marketing year.

Mexico was the primary buyer of upland cotton with 333,308 bales bought for the week ending Jan. 10, followed by  China (38,110 bales), Turkey (36,359 bales), Pakistan (33,063 bales) and Indonesia (17,510 bales).

Primary destinations for upland cotton shipments for the week included Turkey (25,853 bales), Indonesia (23,587 bales), China (21,218 bales), Mexico (17,922 bales), Vietnam (14,523 bales), and Thailand (12,978 bales). Primary export markets for American Pima cotton during the week included Pakistan (6,592 bales), India (5,150 bales), Peru (2,678 bales) and China (1,545 bales).

As of Jan. 10, the top five US export markets in terms of sales are China (2.16 million bales), Mexico (1.62 million bales), Turkey (1.28 million bales), Indonesia (827,000 bales) and Thailand (445,000 bales). With approximately 7 months remaining in the marketing year, weekly shipments must average roughly 357,000 bales to reach the USDA projection of 16.0 million bales.


Prices Effective: Jan. 18-24, '08

Adjusted World Price, SLM 11/16

59.01 cents

*

Coarse Count Adjustment

0.00 cents

Marketing Loan Gain Value

0.00 cents

Import Quotas Open

NA

Step 3 Quotas (480-lb. bales)

 NA

ELS Payment Rate

10.39 cents

*No Adjustment Made Under Step I
 
Five-Day Average
 
Current 3135 c.i.f. Northern Europe

75.53 cents

Forward 3135 c.i.f. Northern Europe

NA

Coarse Count c.i.f. Northern Europe

NA

Current US c.i.f. Northern Europe

76.25 cents

Forward US c.i.f. Northern Europe

NA

 
2007-08 Weighted Marketing-Year Average Farm Price  
 
Year-to-Date (August-November)

51.53 cents

**

**August-July average price used in determination of counter-cyclical payment

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