Cotton's Week: October 31, 2008

Cotton's Week: October 31, 2008


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NCC Applauds Program Implementation, Sen. Chambliss’ Efforts

USDA announced the release of the regulations necessary to implement the new farm law’s cotton program provisions.

Beginning on Oct. 31, the calculation of the adjusted world price (AWP) will be made in accordance with adjustments included in the new law, which are designed to ensure US cotton is available at competitive prices in domestic and international markets.

Importantly, the USDA announcement makes clear that the new AWP applies to both ’07 and ’08 crop cotton loans. This will ensure that ’07 crop loans maturing at the end of October can be redeemed at a competitive price and will return up to an additional $8.00 per bale to producers. Beginning Oct. 31, any loan deficiency payments (available to producers who choose to forego the loan) will be based on the AWP as calculated in accordance with the new law.

NCC Chairman Larry McClendon welcomed USDA’s announcement as good news for producers, warehouses, manufacturers and merchandisers who are struggling to compete in a difficult and volatile market.

Vienna, GA-based grower Chuck Coley, chairman of the NCC’s American Cotton Producers, said special appreciation is due to Sen. Saxby Chambliss (R-GA) for his effective leadership in drafting the legislation, shepherding it through the legislative process and working with the Administration to ensure that the cotton program was implemented in accordance with Congressional intent.

The new law mandates that USDA makes storage credits available whenever the AWP is below the loan. However, to reduce program costs, the new law also required that the maximum storage credit be reduced by 10% for the ’08-11 crops and 20% beginning with the ’12 crop. The USDA announcement clarifies that the reduced storage rate will not apply to redemptions of ’07 crop cotton. Beginning with the ’08 crop, the reductions will apply to the maximum rate established by USDA in Aug. ’06 and not to individual warehouse rates which significantly reduces any adverse financial impact on cotton warehouses.

The adjustments in the weekly AWP calculation were made to enhance competitiveness, and the modest projected costs were offset totally by changes in other cotton program provisions.

The new law also includes an economic assistance program for US domestic textile mills, and the USDA-approved regulations will establish the program participation rules.

“Thanks to Senator Chambliss’ tireless efforts throughout the process, we have a program that provides the industry an opportunity to be competitive and continue to make a major contribution to Georgia’s economy,” Coley added. “Senator Chambliss’ advocacy for a regulation that treats Georgia’s growers, warehouses, manufacturers and merchandisers in a fair and equitable manner is critical to a robust and competitive cotton industry.”

NCC Chairman McClendon noted, “The efforts of Senator Chambliss were instrumental in the eventual publication of the rules. In addition, the cotton industry recognizes the key role played by USDA Under Secretary Mark Keenum in the development of the regulation.”

EPA Amends Pesticide Container Rule

EPA is revising its pesticide container regulations to extend the labeling compliance deadline by a year, to change some labeling definitions and to provide exceptions to some label language requirements, the agency said in a final rule published in the Oct. 29 Federal Register.

The final rule amends regulations issued in ’06 that required all pesticide products “distributed or sold” by a registrant to comply with its labeling requirement as of Aug. 17, ’09. The amendments substitute the words “released for shipment” in place of “distributed or sold” and extend the compliance deadline to Aug. 17, ’10.

EPA said the change was made in response to industry comments on the original regulations, issued under the Federal Insecticide, Fungicide, and Rodenticide Act.
The amendments modify the ’06 rule on Pesticide Management and Disposal: Standards for Pesticide Containers and Containment. Those potentially affected by the final rule include pesticide producers, dealers, professional applicators and custom blenders.

Several industry representatives who had commented on the original regulation expressed concern that retaining the original phrase “sold or distributed” could be interpreted to mean that on Aug. 17, ’09, pesticide registrants would have to re-label all products that had been shipped to retail customers. Under some contracts allowing retailers to return unsold seasonal consumer pesticides to manufacturers, the product might not reach manufacturers before the label compliance deadline, the agency noted when it proposed revisions to the rule in June. EPA said the change will allow all products “in the channels of trade” before or after the deadline to be in compliance, unless they were re-labeled, re-packaged or otherwise subject to a new production process.

The amendments also exempt several types of non-refillable pesticide containers from having to carry labels by stating that they are non-refillable. According to the rule, those containers include aerosol cans, single-use caulking tubes, foil packages for water-soluble packaging, single-use bait stations, pet collars or animal ear tags, and containers that are destroyed by using the chemical they contain.

Other amendments include defining “dilutable” as meaning the pesticide product's labeling allows or requires the pesticide product to be mixed with an inert liquid prior to application or use; and defining “transport vehicle” as a cargo-carrying vehicle such as an automobile, van, tractor, truck, semitrailer, tank car or rail car. The amendments also exempt transport vehicles from being limited to carrying only one type of pesticide.

For more information on the pesticide container rule, contact Jeanne Kasai, EPA's Office of Pesticide Programs-Field and External Affairs Division, at (703) 308-3240, or e-mail at; or call Nancy Fitz, Field and External Affairs Division, at (703) 305-7385, or e-mail at

The amended final rule is available under Docket No. EPA-HQ-OPP-2005-0327 at

PBAC Defines Eradication, Welcomes Mexican Aid

The Pink Bollworm Action Committee (PBAC) approved a recommendation from its Technical Advisory Committee (TAC) itemizing the ’09 program area sterile moths release number and adopted a TAC-proposed working definition of eradication. The PBAC met in Tempe, AZ, following its TAC meeting.

Other action items from the meeting included urging the Center For Plant Health Science Technology under USDA’s Animal & Plant Health Inspection Service’s Plant Protection Quarantine to continue research with the transgenic pink bollworm as an enhancement of current marker technology and to explore other marker technology alternatives.

The Committee also adopted a recommendation by the TAC to place a high priority on improving the eradication programs’ moth identification capabilities, specifically exploring equipment needs contingent upon available funds.

Arizona producer and PBAC chairman Dennis Palmer extended a special welcome to the co-partners in pink bollworm eradication in Mexico. The Mexican delegation consisted of 18 representatives (federal, state and producer) involved in eradication of pink bollworm and boll weevil in that country.

The Mexican representatives provided an update of the eradication programs’ progress in the states of Chihuahua, Baja California and Sonora. Chairman Palmer and Hector Sanchez Anguiano, director of Phytosanitary Protection, SENASICA-SAGARPA, expressed hope that the communication between countries working toward eradication of pink bollworm enhances the success of both the US and Mexican eradication programs.

Texas Region Continues Weevil Eradication

The Texas Dept. of Agriculture (TDA) announced that cotton producers in the Northern High Plains Boll Weevil Eradication Zone have voted to continue program operations. Final results were 882 voting "for" and 129 voting "against" continuation.

TDA issued 2,666 ballots to cotton producers who were eligible to vote in the referendum. A total of 1,011 valid ballots were postmarked by the Oct. 9 deadline and counted.

In addition to deciding if an eradication program should be continued in the zone, the voters elected Weldon Melton to serve as the board member on the statewide board of directors for the Texas Boll Weevil Eradication Foundation, Inc.

The Northern High Plains Eradication Zone consists of Swisher and Hale counties and parts of Randall, Armstrong, Brisco and Floyd counties.

’09 BWCC Housing Open

Anyone wanting to attend the ’09 Beltwide Cotton Conferences on Jan. 5-8 in San Antonio, TX, can make housing reservations beginning Monday, Nov. 3.

At the BWCC home page,, click on the housing link in order to reserve a room at the Marriott Rivercenter or Riverwalk hotels or the new Grand Hyatt San Antonio -- the property that will be nearest to the Cotton Production Conference general session in the Lila Cockrell Theatre of the Henry B. Gonzalez Convention Center. The Production Conference workshops and BWCC Technical Conferences will be in the Riverwalk and the Rivercenter, which also will be the registration site.

Attendees also are urged to register early for the ’09 BWCC by clicking on the registration link on the Beltwide website, which also includes a PDF of the ’09 BWCC general schedule and other valuable information about the meeting as well as visitor information for San Antonio. Dec. 8 is the last day to register for a discounted rate.

Cotton Is King at Japan Show

Cotton Council International, Cotton Incorporated and the Japan Cotton Promotion Institute (JCPI) organized the Cotton Service Center at the Japan Creation trade show -- the largest textile trade show in Japan and a leading forum in Asia to exhibit innovative, high quality textile fabric.

The booth featured Cotton Incorporated’s technology and the latest US cotton-rich innovative fabric from member companies of the Japan Spinners’ Assoc. In addition, JCPI presented the latest cotton fashion trends. About 4,000 people visited the cotton center over the course of the Tokyo event.

Sales Slip, Shipments Strong

Net export sales for the week ending Oct. 23, ’08 were 59,700 bales (480-lb). This brings total ’08-09 sales to about 6.8 million bales. Total sales at the same point in the ’07-08 marketing year were about 6.2 million bales.

Mills in China have purchased 2.1 million bales, or 30% of total sales. Mexico and Turkey account for 16% and 11% of sales, respectively.

Total new crop (’09-10) sales are 82,100 bales.

Shipments for the week were 257,600 bales, bringing total exports to date to 3.0 million bales, compared with the 3.4 million bales at the comparable point in the ’07-08 marketing year.

Prices Effective Oct. 31-Nov. 6, '08

Adjusted World Price, SLM 11/16

40.12 cents


Fine Count Adjustment ('07 Crop)

0.28 cents

Fine Count Adjustment ('08 Crop)

0.00 cents

Coarse Count Adjustment

0.00 cents

Marketing Loan Gain Value

11.88 cents

Import Quotas Open


Limited Global Import Quota (480-lb bales)


ELS Payment Rate

0.00 cents

*No Adjustment Made Under Step I


Five-Day Average


Current 5 Lowest 3135 CFR Far East

58.71 cents

Forward 5 Lowest 3135 CFR Far East


Coarse Count CFR Far East

56.60 cents

Current US CFR Far East

58.25 cents

Forward US CFR Far East



'07-08 Weighted Marketing-Year Average Farm Price  

Final Marketing Year Average Price

59.30 cents


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