Cotton's Week: July 31, 2009

Cotton's Week: July 31, 2009


Sweeping Food Safety Bill Passed

The House passed a sweeping food safety bill (H.R. 2749) by a 283‑142 vote one day after the bill narrowly fell short of the two-thirds needed to pass under suspension of the rules -- an expedited procedure that limits debate and bars amendments.

Within hours of the bill’s failure under suspension, the Rules Committee approved a closed rule for the bill that allowed it to return to the floor so it could pass by simple majority.

The legislation was motivated by several high-profile recalls in recent years of tainted food products, including beef, spinach, tomatoes and peanut butter. The bill’s sponsor, Energy and Commerce member Dingell (D-MI), said 76 million people in the United States are sickened from food-borne illnesses annually and about 5,000 die.

Agricultural groups were concerned that the bill would give too much authority to the Food and Drug Administration (FDA) to regulate farm activities and Agriculture Committee members claimed that the measure should have been referred to their committee.

Agriculture Chairman Peterson (D-MN), however, negotiated changes in the bill which included on-farm exemptions for livestock, poultry and grain (including cottonseed), which will continue to be regulated by USDA, and exemptions for farms from most of the bill’s record-keeping and traceability requirements. However, the Committee’s Republicans, led by ranking member Lucas (R-OK), said these changes did not go far enough and would drive up consumers’ food costs and force businesses overseas.

The bill would require the FDA to create a system for tracing food along the food chain so that recalls can be implemented more quickly. It also would allow the FDA, for the first time, to impose civil and criminal penalties and to implement mandatory food quarantines.

Food quarantines are currently voluntary. Under this legislation, a quarantine could be ordered in a specific geographic region only if there is “credible evidence or information that an article of food presents a threat of serious adverse health consequences or death to humans or animals.” The FDA could prohibit or restrict the movement of contaminated food or vehicles that are being used to transport such food within the geographic area. Additionally, the bill would increase the frequency of inspections at certain food facilities, mandating inspections ranging from every six months to every five years, depending on the level of risk at the facility.

Increased inspections will be funded by requiring food facilities to register with the FDA and pay a registration fee. Farms, grocery stores and restaurants would be exempt from these requirements. Annual fees would be set at $500 per facility and adjusted each year for inflation. Fees would be capped at $175,000 for companies owning multiple facilities.

The bill would include gins and cottonseed crushers under its regulations. The NCC will continue to work with the Farm Bureau, commodity groups, other oilseed processors and the grain trade to preserve the progress made and address the concerns of affected cotton industry processors as the bill goes to the Senate.

CSP Interim Rule Issued

USDA announced the Interim Final Rule for the Conservation Stewardship Program (CSP).

CSP was overhauled in the ’08 farm law and this rule seeks to implement those changes mandated by Congress. The ’08 law provided $1.1 million in new funding for CSP with a goal of enrolling nearly 13 million acres per year. In addition, the law restructured the program to provide conservation stewardship payments that encourage producers to implement additional conservation practices, and it emphasizes attainment of new conservation benefits.

The revamped CSP was designed by Congress to be a nationwide program open to all eligible producers.

NCC will review the rule’s details and prepare comments. Any individual or organization wishing to submit comments on the rule must do so on or before Sept. 28, ’09.

Cottonseed Insurance Pilot Approved

The Federal Crop Insurance Corp. Board has approved a new four-year cottonseed insurance product that insures against cottonseed losses to producers beginning in ’10.

The product will be available as an optional insurance endorsement for producers who purchase a qualifying buy-up policy on cotton lint. The product will require no additional record-keeping and will utilize the same coverage level, premium rates and premium subsidies as the underlying cotton lint policy.

The endorsement will not be available for growers who purchase GRIP, CAT or GRP cotton policies. The Risk Management Agency (RMA) will be providing more information in the near future.

This product was developed at the urging and financial support of

Texas cotton producer leadership, mainly through the efforts of Plains Cotton Growers, Inc. NCC supported the pilot project’s development in a letter to the RMA.

DCP, ACRE Signup Deadline Near
Producers are reminded that Aug. 14, ’09 is the last day to sign-up for the ’09 direct and counter-cyclical commodity programs (DCP) and for the ACRE program.

For more information about ACRE , DCP and other price support programs, please visit your Farm Service Agency county office or

Suit Target Includes Endosulfan

The Center for Biological Diversity (CBD) notified EPA of its intent to file suit against the agency for failing to consider impacts to the polar bear and its Arctic habitat from “toxic contamination” resulting from pesticide use in the United States. This suit will include endosulfan, a pesticide that is important to western cotton growers for late season Lygus and whitefly control.

According to the CBD, pesticides approved by EPA for use in the United States are known to be transported to the Arctic via various atmospheric, oceanic and biotic pathways. Such pesticides are biomagnified with each step higher in the food web, reaching some of their greatest concentrations in polar bears, the apex predators of the Arctic.

“The poisoning of the Arctic is a silent crisis that threatens not just the polar bear, but the entire Arctic ecosystem, as well as the people and communities that live within it,” said the CBD’s Rebecca Noblin. “Because the polar bear sits at the top of the food pyramid, if we do what is necessary to protect the bear from pesticides, we will also be protecting the Arctic ecosystem and the people that depend upon it.”

All US pesticides must be registered by the EPA before they can be lawfully used.  Courts have held that the agency must examine the impacts of any pesticide it approves on species protected under the Endangered Species Act (ESA). The polar bear was formally listed as a threatened species under the ESA on May 15, ’08 following a petition and litigation by CBD, but EPA has yet to examine the impacts of any approved pesticide on the species.

The 60-day notice of intent to sue is a legally required precursor before a lawsuit can be filed under the Endangered Species Act to compel the EPA to comply with the law.

While this action marks the first legal challenge to pesticide registrations due to their impacts on the Arctic, the CBD has brought several successful lawsuits against the EPA over the impacts of pesticides in the lower 48 states. In ’06, the CBD reached a settlement with the agency over the use of 66 pesticides in the habitat of an imperiled amphibian in California, while recently, as a result of a settlement of another CBD lawsuit, the EPA proposed restrictions on 74 pesticides due to their affects on 11 threatened and endangered species in California.

Sales Weak, Shipments Steady

Net export sales for the week ending July 23 were 48,200 bales (480-lb). This brings total ’08-09 sales to approximately 14.3 million bales. Total sales at the same point in the ’07-08 marketing year were approximately 15.6 million bales.

Total new crop (’09-10) sales are 1.2 million bales.

Accounting for 29% of total US export sales, China continues to be the largest international customer of US cotton with total purchases of 4.09 million bales. Turkey has established itself as the second largest customer with purchases of 1.96 million bales, or 14% of the total. Mexico ranks third with purchases of 1.50 million bales. Indonesia now ranks as the fourth largest customer with purchases of 1.17 million bales. With sales of just under 800,000 bales of US cotton, Vietnam completes the “Top 5” importers.

Shipments were 229,500 bales, bringing total exports to date to 12.9 million bales, compared with the 13.2 million bales at the comparable point in the ’07-08 marketing year.

Third ’09 PIE Tour In California

Southeastern cotton producers will travel to California’s San Joaquin Valley on Aug. 2-5 as part of the ’09 Producer Information Exchange.

On Aug. 3, the group will visit the Bayer CropScience research facility in Fresno and the Central California Almond Growers Assoc. and a dairy in Kerman. The next day they will tour Gilkey Enterprises and other farming operations in Corcoran before visiting the Terra Nova Ranch in Helm and other farms near there. On Aug. 5, they will tour the Quady Winery in Madera, the Dos Palos Coop Roller Gin in Minturn, and travel to Los Banos for visits to a tomato processing plant and area farms, including Delta Farms.

Participants include: Virginia – Steele Byrum, Smithfield; North Carolina – Tim Phelps, Gaston; and Pat Simmons, Fairfield; South Carolina – Kayla Player and Pete Player, III, Bishopville; Georgia – James Clark, Surrency; Matt Coley and James Warbington, III, Vienna; Hugh Dollar, III, Bainbridge; Aaron Griner, Alapaha; and Justin, Jones, Smithville; and Alabama – Kevin Holland, Bay Minette; and Jonathan Spruell, Mount Hope.

Sponsored by Bayer CropScience through a grant to The Cotton Foundation, the PIE helps US cotton producer participants improve yield and fiber quality.

Prices Effective July 31-Aug. 6, '09

Adjusted World Price, SLM 11/16

45.64 cents


Fine Count Adjustment ('08 Crop)

 0.38 cents

Fine Count Adjustment ('09 Crop)

  0.18 cents

Coarse Count Adjustment

  0.00 cents

Marketing Loan Gain Value

 6.36 cents

Import Quotas Open


Special Import Quota (480-lb bales)


ELS Payment Rate

  5.63 cents

*No Adjustment Made Under Step I


Five-Day Average

Current 5 Lowest 3135 CFR Far East

62.41 cents

Forward 5 Lowest 3135 CFR Far East

63.77 cents

Coarse Count CFR Far East

63.37 cents

Current US CFR Far East

65.20 cents

Forward US CFR Far East

67.95 cents


'08-09 Weighted Marketing-Year Average Farm Price  

Year-to-date (Aug.-May)

48.94 cents


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

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