Cotton's Week: January 23, 2009

Cotton's Week: January 23, 2009

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Senate Confirms Vilsack

The Senate confirmed former two-term Iowa Gov. Tom Vilsack to be the next Secretary of Agriculture. Prior to his governorship, Vilsack worked in the private sector and also served as a state senator.

Upon his confirmation, Secretary Vilsack announced the appointment of John Norris as his chief of staff. Norris was formerly the chairman of the Iowa Utilities Board.

In addition, Secretary Vilsack announced the appointment of Carole Jett as deputy chief of staff. Jett worked for USDA’s Natural Resources Conservation Service before her retirement last year.



Time Sought For Farm Program Comments

The NCC has joined with other commodity and general farm organizations in requesting a 30-day extension of the Jan. 28 deadline for submitting comments on the farm law’s interim final regulation implementing payment eligibility changes. Their letter to Agriculture Secretary Vilsack can be accessed at the NCC’s home page, www.cotton.org.

 More time is needed to fully analyze and offer constructive comments on the Dec. 29-issued regulation which not only implements the far-reaching reforms to payment eligibility and income test provisions included in the ’08 farm law but also included significant changes to the rules governing whether an individual or entity is "actively engaged" in farming. 

While additional time is needed to develop appropriate comments to the rule, farmers need important clarifications to the regulation immediately in order to sign up for the ’09 cotton program prior to the June 1 deadline. Such clarification should be issued in the very near future and should not wait until the close of an extended comment period.

NCC has consulted with growers, attorneys, CPAs and other organizations in an effort to identify questions and recommendations to be included in the industry's comments. In addition to identifying a number of provisions which require further explanation, the industry is concerned about the narrow interpretation of some important provisions in the statute and the inclusion of changes to current regulations that were not included in the statute.

NCC plans to submit detailed comments and is urging other organizations to submit comments as well.



Base Acres Terminated on Federal Land

In the regulation implementing direct and counter-cyclical payment programs for the ’09 and subsequent crops and in a recent Farm Service Agency Notice (FSA Notice DCP-204), USDA announced it would unilaterally terminate base acres beginning with the ’09 crop on all land owned by the US government, whether or not such land was owned directly by USDA or another agency.

If land was subject to a lease agreement before Dec. 23, ’08, then the base acres will not be terminated until the lease expires (excluding any options).

USDA gave no explanation for this decision and did not cite any explicit authority for this action. The regulation was issued as a final rule with no opportunity for notice and comment.  NCC and other groups are working with Congress and the new Administration in an effort to overturn this rule.



Disaster Program Sign-Up Deadline Feb. 27

USDA's Farm Service Agency (FSA) announced that the sign-up period for the ’05-07 Crop Disaster Program (CDP) will end Feb. 27, ’09. This ending date applies to the receipt of a signed and completed FSA-840 application along with all supporting documentation and required forms at the applicable county FSA office.

Sign-up information and required forms are available at each county FSA office. Late filed applications will not be approved after this deadline. All application determinations will be made by March 27, ’09.

For additional information about CDP and the sign-up deadline, producers may contact their county FSA office or visit http://www.fsa.usda.gov.



WHIP Interim Final Rules Issued

USDA, which issued interim final rules for the Wildlife Habitat Incentives Program (WHIP) and changes to the technical services provider (TSP) process, is seeking public comment on both of these rules until March 17.

The WHIP interim final rule contains the legislative changes and the program’s proposed policy for the life of the ’08 farm law. There are now three categories of eligible land for this program -- private agricultural lands, non-industrial private forest lands and Indian lands. The new farm law excludes non-agricultural lands and publicly owned lands (federal, state, county or local) from eligibility.

Up to 25% of WHIP funds now will be available for long-term agreements (15 years or longer) to protect and restore essential plant and animal habitat. Previously, the amount available for these types of agreements was capped at 15% of WHIP funds.

The Natural Resources Conservation Service (NRCS) can pay up to 90% of the cost to apply or install conservation practices for essential plant and wildlife habitat.

Another change specifies that payments to an individual or legal entity cannot exceed $50,000 annually. In addition, the ’08 farm law will allow landowners to receive payments to develop other types of wildlife habitat, including habitat established on pivot corners and irregular areas.

The interim final rule for TSPs reflects the changes in the ’08 farm law. These changes include a nationally consistent certification process for TSPs and national approval of any additional certification requirements required by NRCS state offices. Another change called for NRCS to establish fair and reasonable payment rates for TSPs.

The legislation also better defined the TSP process. It defined eligible participants as producers, landowners and entities that are eligible to participate in USDA conservation programs. It also stated that Commodity Credit Corp. funds must be available for technical assistance from TSPs.

Under the TSP process, producers can receive assistance from NRCS directly, through an agreement with a third-party provider or through a payment to the eligible participant for assistance from an approved third party provider. Producers can receive both financial and technical assistance. However, producers only needing technical assistance can enter into an agreement for these services with NRCS.

NCC will continue to monitor and submit comments on these and other USDA-issued regulations.



Proposed Biotech Rule Comments Sought

USDA’s Animal and Plant Health Inspection Service (APHIS) announced that it will be extending the public comment period until March 17, ’09 on a proposed rule to revise existing regulations regarding the importation, interstate movement and environmental release of certain genetically engineered (GE) organisms.

APHIS is extending the public comment period to allow more time for interested parties to prepare and submit comments. While the public is invited to comment on any of the provisions outlined in the proposed rule, APHIS is particularly interested in receiving comments related to the following areas:

* The scope of the regulations and which GE organisms should be included or excluded from the proposed regulations;
* Incorporation of the noxious weed provisions of the Plant Protection Act into the proposed regulations;
* Elimination of the notification procedure -- a streamlined procedure for authorizing the importation, interstate movement or environment release of certain GE organisms -- including specific suggestions for protecting against the introduction of plant pests or noxious weeds while minimizing any additional burden or delay for applicants; and
* Regulation of GE crops that produce pharmaceutical and industrial compounds, including specific suggestions on how to provide appropriate protection based upon risk.

With this extension, APHIS will consider all comments received on or before March 17, including any comments received after the close of the original public comment period on Nov. 24, ’08, and the date of this notice.

Comments can be submitted on the Federal eRulemaking portal at http://www.regulations.gov/fdmspublic/component/main?main=DocketDetail&d=APHIS-2008-0023.



Costa Rica Joins CAFTA

Costa Rica joined the Central America Free Trade Agreement (CAFTA) as of Jan. 1, ’09.

The United States, Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras and Nicaragua signed the CAFTA-DR in Aug. ’04. Implementing legislation for the CAFTA-DR passed Congress and was signed by the President in ’05. The CAFTA-DR entered into force for El Salvador, Honduras, Nicaragua and Guatemala in ’06, and for the Dominican Republic in ’07.

Trade and commercial opportunities have grown since the CAFTA-DR first took effect in early ’06. US exports to all six CAFTA-DR countries were at record levels in ’07, reaching $22.4 billion.

Partnering with US mills, Cotton Council International has worked vigorously to promote US exports of cotton yarn and fabric to manufacturers in the region under the CAFTA and its predecessor, the Caribbean Basin Trade Partnership Act. Under CAFTA-DR, the region is also a growth market for US cotton fiber.



Sales Hit Marketing Year High

Net export sales for the week ending Jan. 15 were 484,900 bales (480-lb) – a marketing year high. This brings total ’08-09 sales to approximately 8.9 million bales. Total sales at the same point in the ’07-08 marketing year were approximately 9.0 million bales. Total new crop (’09-10) sales are 116,000 bales.

Shipments for the week were 163,300 bales, bringing total exports to date to 5.5 million bales, compared with the 5.8 million bales at the comparable point in the ’07-08 marketing year.



Trio Honored With Genetics Award

The team of Drs. Al Bell, Forest Robinson and Dave Stelly received the ’08 Cotton Genetics Award by accomplishing a major breakthrough in transferring resistance to reniform nematode from a wild cotton species to upland cotton. The announcement was made at the Beltwide Cotton Improvement Conference.

Dr. Bell is a USDA Agriculture Research Service (ARS) research plant pathologist, Dr. Robinson is a USDA-ARS research zoologist and Dr. Stelly is a professor of Molecular & Environmental Plant Sciences at Texas A&M U.

Also unveiled at the Beltwide:

The ’09 High Cotton awards recipients are: Mike Tate, Huntsville, AL; Jason Luckey, Humboldt, TN; Jimmy Dodson, Corpus Christi, TX; and Danny Locke, Firebaugh, CA. They were recognized at the ’09 Beltwide Cotton Conferences in San Antonio for environmental contributions to their communities. The Cotton Foundation awards program is funded via a grant from Farm Press Publications.

Van Murphy, a Quitman, GA, producer/ginner, was named the Cotton Grower Achievement Award recipient for outstanding and unselfish contributions to the industry. He is the executive manager of BCT Gin Co., Inc., chairman of the National Cotton Ginners Assoc. and has been a Cotton Board director for 13 years.

Dr. Philip Bauer, lead scientist at the USDA- ARS Coastal Plains Soil, Water, and Plant Research Center in Florence, SC, received the Cotton Physiology Researcher of the Year Award. The award is supported by Arysta LifeScience.

Dr. C. Dale Monks, a professor and Extension cotton specialist with Auburn U., was recognized as the ’08 Extension Cotton Specialist of the Year. The award is supported by Bayer CropScience.

Ray Young of Wisner, LA, is the recipient of the Cotton Consultant of the Year ’08 Lifetime Achievement Award presented by Cotton Farming magazine and Syngenta.



Prices Effective Jan. 23-29, '09

Adjusted World Price, SLM 11/16

38.42 cents

*

Fine Count Adjustment ('07 Crop)

  1.18 cents


Fine Count Adjustment ('08 Crop)

  0.78 cents


Coarse Count Adjustment

  0.00 cents


Marketing Loan Gain Value

 13.58 cents


Import Quotas Open

2


Limited Global Import Quota (480-lb bales)

159,244


ELS Payment Rate

  0.00 cents


*No Adjustment Made Under Step I

 

Five-Day Average

 

Current 5 Lowest 3135 CFR Far East

 57.01 cents


Forward 5 Lowest 3135 CFR Far East

NA


Coarse Count CFR Far East

55.80 cents


Current US CFR Far East

58.10 cents


Forward US CFR Far East

NA


 

'08-09 Weighted Marketing-Year Average Farm Price  
 

Year-to-date (Aug.-Nov.)

56.08 cents

**

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

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