Cotton's Week: September 18, 2009

Cotton's Week: September 18, 2009

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House Panel Approves Rail Bill

A House Judiciary Committee approved legislation (H.R. 233) that would repeal longstanding antitrust exemptions for freight railroads.

Since 1914, freight railroads have been exempt from antitrust regulations, allowing them to seek clearance for mergers or rate changes from the Surface Transportation Board. The legislation would require freight railroads to seek approval from the Dept. of Justice for any mergers, acquisitions or collective rate-making agreements, bringing them in line with the trucking and airline industries.

The measure also would allow state attorneys general and private parties to file antitrust suits in federal court. Under current law, parties can file a complaint with the Surface Transportation Board but are prohibited from bringing lawsuits.

This legislation is similar to legislation in the Senate that is being incorporated into a comprehensive rail reform bill -- one expected to include major reforms to the Surface Transportation board as well as the repeal of the antitrust exemptions. Sen. Rockefeller (D-WV), chairman of the Senate Commerce Committee, is expected to introduce this legislation in the coming weeks.

The NCC has joined with other agriculture organizations urging the Senate to move forward with this comprehensive rail legislation.



FDA Food Reporting Rule Issued

A new rule issued Sept. 8 requires food facilities registered with the Food and Drug Administration (FDA) under the existing Bioterrorism Act to now submit a report via FDA's new electronic registry at http://rfr.fda.gov/ within 24 hours if they find a reasonable probability that an article of food may cause severe health problems or death to a person or animal. Gins and cottonseed crushers/merchandisers were required to register under the 2003 Bioterrorism Act and are, therefore, covered by this rule.

The reporting requirement applies to all foods and animal feed regulated by the FDA except infant formula and dietary supplements. Failure to submit the required report within 24 hours may lead to civil and criminal penalties. No report will be required if the responsible party of the registered food facility found the problem before the food was shipped and corrected the problem or destroyed the food.

More information, including links to a FDA guidance document and the FDA Registry, are on the National Cotton Ginners’ Assoc. website, www.cotton.org/ncga/issues.



Early BWCC Housing to Begin

NCC and Cotton Foundation members planning to attend the ’10 Beltwide Cotton Conferences (BWCC) on Jan. 4-7 at the New Orleans Marriott and the Sheraton New Orleans can make early housing reservations online from Sept. 22-Oct. 23. Housing reservations for other attendees will begin on Nov. 3.

For early room reservations at the Marriott or Sheraton, go to the NCC’s home page, www.cotton.org, and click on the Beltwide graphic or go directly to the BWCC home page, www.cotton.org/beltwide, and click on the link “Early Beltwide Hotel Reservations” on the left side of the page. NCC-issued user IDs and passwords are required to use this option. A user ID and password can be obtained from www.cotton.org by selecting the “Sign up for a user ID” option found on the upper left hand side of the page.

Attendees also can complete “early” registration for the ’10 BWCC site by clicking on the registration link at www.cotton.org/beltwide. Also on this site is the “2010 Program Overview,” including a tentative meeting schedule, to help attendees with travel plans. This information can be printed. No printed booklet will be mailed.



Sales, Shipments Slip

Net export sales for the week ending Sept. 10 were 83,400 bales (480-lb). This brings total ’09-10 sales to about 3.5 million bales. Total sales at the same point in the ’08-09 marketing year were about 5.3 million bales. Total new crop (’10-11) sales are 89,000 bales.

Shipments for the week were 127,700 bales, bringing total exports to date to 1.1 million bales, compared with the 1.6 million bales at the comparable point in the ’08-09 marketing year.



More Endangered Species Restrictions Proposed

EPA has announced proposals to place additional restrictions on the use of three organophosphate pesticides — chlorpyrifos, diazinon, and malathion — to protect endangered and threatened salmon and steelhead in California, Idaho, Oregon and Washington.

The Endangered Species Act (ESA) requires EPA to ensure that a pesticide is not likely to jeopardize endangered or threatened species, or to adversely affect the species’ habitat. If EPA determines that a pesticide may affect listed species or critical habitat, the agency must consult with the National Marine Fisheries Service (NMFS) or the US Fish and Wildlife Service.

The new use limitations are the result of consultations that EPA initiated with the NMFS in ’02, ’03 and ’04 as part of a settlement agreement involving 37 pesticides on the listed fish (Northwest Coalition for Alternatives to Pesticides v. National Marine Fisheries Service, W.D. Wash., No. 07-1791, 8/1/08), and will replace interim limitations put in place by the US District Court for the Western District of Washington in ’04.

These new limits are especially significant because they mark the first time that EPA and NMFS have completed the consultation process under the ESA in more than 20 years. Anticipated changes to product labels include the addition of pesticide buffer zones; application limitations based on wind speed, soil moisture and weather conditions; and fish mortality incident reporting requirements. New enforceable labels could be available as early as the ’10 spring growing season. EPA is asking the manufacturers to voluntarily adopt the new limitations on labeling for these pesticides. If the manufacturers decline this request, EPA will pursue regulatory action to impose the limitations.

EPA's plans differ from those recommended by NMFS which included set buffer zones of 1,000 feet for aerial application and 500 feet for ground application. According to EPA, it hopes to achieve the same goal of protecting salmon stream areas but it has done so in a different way. EPA has looked at the concentrations of pesticide use depending on the type of application and various conditions. Under EPA's approach, an aerial application, for example, may have a buffer zone anywhere from 100 feet to 1,000 feet, depending on a matrix of various factors.

NMFS officials plan to assess whether or not EPA's approach will result in the same level of protection under its plan. Environmentalists have stated that EPA's proposed pesticide labels would be based on a complicated matrix depending on a number of variables and it may be difficult for a farmer to understand how to apply a pesticide to his property on a particular day.

CropLife America was pleased with the EPA's decision in favor of modifying the proposed fisheries service buffers.

“The importance of the agricultural use of crop protection products cannot be underestimated,” according to a CropLife America statement. “This is recognized by Section 1010 of the Endangered Species Act which specifically requires EPA's program to ‘minimize the impacts to persons engaged in agricultural food and fiber commodity production and other affected pesticide users and applicators.' ”



Endangered Species Listings Accelerated

The Obama administration is moving to accelerate Endangered Species Act (ESA) listing decisions for hundreds of plant and animal species.

A "candidate species" is a designation that offers no legal protections and is intended to be temporary. According to the Center for Biological Diversity (CBD), though, nearly 100 species have been on the ESA waiting list for more than 10 years and 73 have been waiting more than 25 years.

ESA requires the Dept. of the Interior to issue a decision on whether a species deserves a listing within 12 months from its receipt of a listing petition. But, CBD says that petitions are going unanswered for an average of 11 years and often are not addressed until forced by a judicial order.

The Obama administration says it is going to change how candidate species are handled. The Fish & Wildlife Service (FWS) is working on an accelerated listing process through an ecosystem approach which would cluster multiple species from an ecosystem into a single ESA listing. Federal biologists claim the strategy allows for the management of an entire ecosystem, rather than going species by species. It also condenses the listing process for many plants and animals into one proposal. The support for an ecosystem approach to ESA began in the Bush Administration, which proposed listing 48 plants and animals on a Hawaiian island.

The administration also is planning to allocate more funding for ESA.  The budget has more than doubled since early in the Bush Administration, going from $9 million in ’02 to $19 million in FY09. The average cost of a complete listing decision is $85,000 and of a single designation of critical habitat is $515,000, according to FWS. Environmentalists say the agency needs about $30 million a year to deal with the listing backlog.



MAP Regulations Comments Sought

USDA’s Foreign Agricultural Service (FAS) requests public comments on proposed regulation changes for the Market Access Program (MAP) as published in the Federal Register. The changes are expected to clarify program requirements ranging from application procedures to evaluations. The deadline for submitting comments is Nov. 9, ’09.

The MAP provides cost-share assistance to nonprofit US trade organizations and small-sized entities for help in creating, expanding and maintaining foreign markets for US agricultural commodities and products. MAP participants must contribute a minimum of 10% of the funds provided by the program for the cost of generic marketing and promotion activities and a dollar-for-dollar match for branded promotions.

Some of the rule changes include: 1) updating and merging application and activity plan requirements to reflect the Unified Export Strategy (UES) system; 2) clarifying the eligibility of activities designed to address international market access issues; 3) modifying the list of eligible and ineligible contributions; and 4) revising evaluation and contracting procedures and the compliance review and appeals processes.

Comments may be submitted by any of the following methods: Federal e-Rulemaking Portal at http://www.regulations.gov; e-mail to podadmin@fas.usda.gov; fax to (202) 720-9361; hand delivery or courier to USDA, Foreign Agricultural Service, Office of Trade Programs, Program Operations Division, Portals Office Bldg, Ste 400, 1250 Maryland Ave., SW, Washington, DC, 20024; or US Postal delivery to USDA, Foreign Agricultural Service, Office of Trade Programs, Program Operations Division, Stop 1023, 1400 Independence Ave., SW, Washington, DC, 20250-1042.

For more information, contact Mark Slupek, director, Program Operations Division, Office of Trade Programs at (202) 720-4327 or podadmin@fas.usda.gov.



Western Hemisphere Event Planned

The COTTON USA Western Hemisphere Manufacturers Tour set for Sept. 21-24 is aimed at enhancing sales of US manufactured cotton yarn and fabric. The event, coordinated by Cotton Council International (CCI), is part of the COTTON USA Sourcing Program which encourages exports of US manufactured cotton textile products throughout Latin America.

Yarn and fabric buyers from 10 Western Hemisphere countries will meet with US cotton textile mills. On the tour will be yarn buyers from 29 firms and fabric buyers from 10 firms. Countries represented include Colombia, Costa Rica, the Dominican Republic, Ecuador, El Salvador, Guatemala, Honduras, Peru, Haiti and Mexico.

The buyers will participate in a seminar on Sept. 22 in Charlotte, NC, that will cover timely topics ranging from a cotton fiber supply/demand outlook to cotton consumer and retail trends. They also will tour a cotton farm and gin in New London, NC.

The next day they will meet with top US textile industry executives representing Buhler Quality Yarns Corp., Jefferson, GA; Carolina Cotton Works and Hamrick Mills, both in Gaffney, SC; Contempora Fabrics, Lumberton, NC; Frontier Spinning Mills, Sanford, NC; Parkdale, Gastonia, NC; Tuscarora Yarns, Mt. Pleasant, NC; and Zagis USA, Lafayette, LA. They also will tour those participating US mills.



Prices Effective Sept. 18-24, '09

Adjusted World Price, SLM 11/16

47.75 cents

*

Fine Count Adjustment ('08 Crop)

 0.06 cents


Fine Count Adjustment ('09 Crop)

  0.00 cents


Coarse Count Adjustment

  0.00 cents


Marketing Loan Gain Value

 4.25 cents


Import Quotas Open

8


Special Import Quota (480-lb bales)

497,951


ELS Payment Rate

  4.63 cents


*No Adjustment Made Under Step I

 

Five-Day Average



Current 5 Lowest 3135 CFR Far East

64.12 cents


Forward 5 Lowest 3135 CFR Far East

NA


Coarse Count CFR Far East

67.23 cents


Current US CFR Far East

70.15 cents


Forward US CFR Far East

NA


 

'08-09 Weighted Marketing-Year Average Farm Price  
 

Year-to-date (Aug.-July)

48.61 cents

**

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

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