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March 5, 2010
 

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USDA Announces ’09 Partial CCP

Agriculture Secretary Tom Vilsack announced that a partial ’09-crop counter-cyclical payment (CCP) of 1.03 cents will be made available to producers with upland cotton base acres enrolled in USDA’s Direct and Counter-cyclical Payment program.

Under the ’08 farm law, producers are required to repay any amount by which the partial payment exceeds the actual CCP, which is determined after the end of the marketing year. Furthermore, producers have the option to request the partial payment now, request the payment at a later time in the marketing year, or defer the partial CCP and receive the final CCP in October once it is determined. 

For interested producers, a fact sheet, available in the Economics section of the NCC website  http://www.cotton.org/econ/index.cfm, charts monthly farm prices and the implied CCP throughout the marketing year.

The ’08 farm legislation provides that one partial CCP, in an amount up to 40% of the projected CCP, may be issued after 180 days of the marketing year. The partial ’09 CCP of 1.03 cents equals 40% of the difference between the target price of 71.25 cents and the sum of USDA’s projected market year average price of 62 cents and the direct payment rate of 6.67 cents.

The USDA release also announced a    partial ’09-crop CCP of $9.20 per ton for peanuts.

 
USDA Announces CRP Sign up

Agriculture Secretary Vilsack announced a new general Conservation Reserve Program (CRP) signup for ’10. This marks the first general signup since ’06. CRP offers landowners annual payments on 10 to 15-year contracts for establishing native grasses, shrubs, trees and wetlands on their land.

According to USDA, contracts holding 4.4 million acres of CRP will expire on Sept. 30 this year; and an additional 14.2 million acres of CRP will expire between ’11-13. The ’08 farm bill authorized up to 32 million acres in the program.

Vilsack said USDA also will increase by 300,000 acres the allotments for three other federal conservation programs. Those programs will be offered in the continuous CRP signup beginning on March 15. Acreage caps for continual signup programs that will be expanded include Upland Bird Habitat Buffers increased by 100,000 acres and distributed in

Midwest and Southern states that are part of the native range for bobwhite quail.

 
Mississippi River Watershed Details Given

USDA announced a Request for Proposals (RFP) for the Mississippi River Basin Healthy Watersheds Initiative, through which up to $75 million will be available for partnership projects. USDA’s Natural Resources Conservation Service will administer this initiative, first announced on Sept. 24, ’09.

The RFP was published in the Federal Register and proposals are due by May 1. USDA is seeking project proposals that will improve water quality and the overall health of the Mississippi River in 41 eligible watersheds in 12 states, including Arkansas, Louisiana, Mississippi, Missouri and Tennessee.

Smaller watersheds within the initial 41 will be selected for approved partnership projects based on their potential for managing nitrogen and phosphorus—nutrients associated with impaired water quality in the Mississippi River Basin—while maintaining agricultural productivity and benefiting wildlife. Individual producers only can participate in this initiative in approved partnership projects.

USDA will use a competitive process to distribute up to $75 million using two conservation programs in FY10, the initiative's first year. Up to $50 million will come from the Cooperative Conservation Partnership Initiative (CCPI) and an additional $25 million from the Wetlands Reserve Enhancement Program (WREP). USDA expects to provide about $320 million in financial assistance over four years for voluntary conservation projects in these watersheds.

Producers interested in participating in the conservation programs detailed in approved projects must meet the eligibility and funding requirements for the program or programs for which they are applying. Eligible partners must submit separate proposals for CCPI and WREP. Higher priority will be given to projects that integrate both CCPI and WREP.

More information on this Mississippi River Initiative, including the RFP and the eligible watersheds, is at www.nrcs.usda.gov/programs/mrbi/mrbi.html.

 
Senators Float Bipartisan Climate Bill

After months of behind-the-scenes negotiations, Sens. Kerry (D-MA), Lieberman (I-CT) and Graham (R-SC) plan to circulate a draft that will present a new approach to regulating greenhouse gas emissions.

Most global warming bills have relied on an economy-wide cap-and-trade (CAT) structure that would limit carbon emissions across the economy and create a new financial market in trading carbon permits. Democrats have concluded that a CAT bill like the House-passed Waxman-Markey legislation has no chance of passing the Senate.

The Senate proposal will offer a three-pronged or sector-by-sector approach. The legislation will set a national target for reducing carbon, an expected cut of 17% below ’05 levels by ’20. Each of the economy’s three major emission sectors – electric utilities, transportation and manufacturing – will be subject to different forms of regulation. The proposal likely is to apply an emissions cap only on electric utilities while the transportation sector would be subject to some form of tax based on carbon content in fuels. A cap on emissions by manufacturers, with possibly a separate cap-and-trade program or some other system of regulation, may be phased in later.

Aides emphasized that the draft to be circulated to Senators represents an opening bid.  For example, a central piece that still has to be worked out is the basic mechanism for pricing carbon credits. Another idea is the so-called cap-and-dividend plan which would require emitters to purchase emission permits then return those fees directly to consumers.

The sector-by-sector approach might entice a few Senate moderates from both parties who have said they support addressing climate change but oppose a single economy-wide approach.  On the other hand, electric utilities likely are to find the new approach less appealing.

In designing the House climate bill, Energy and Commerce Committee Chairman Waxman (D-CA) worked for months to win the backing of the electric utility industry for a CAT program.

Ultimately, the industry’s support was obtained through giveaways of billions of dollars worth of free emission credits to operators of coal-fired power plants. Those groups likely are to push back hard at the idea of capping only emissions by their sector. Any type of new fuel tax also is likely to be a tough sell.

Sens. Kerry, Graham and Lieberman face a tight schedule to refine a bill and build consensus in time to pass it this year. The pressures of the election-year calendar mean they probably must finish writing the bill and secure a filibuster-proof 60 votes this spring.

 
EPA Renames Pesticides Office

Effective April 22 (Earth Day), the EPA’s Office of Prevention, Pesticides, and Toxic Substances (OPPTS) will become the Office of Chemical Safety and Pollution Prevention.

Steve Owens, assistant administrator for OPPTS made the announcement at the Chemical Producers & Distributors Assoc.'s ’10 Spring Meeting, saying that the new name had been approved.

According to Owens, the name better reflects the mission of the office, which deals with pesticides and chemicals. OPPTS administers the Federal Insecticide, Fungicide, and Rodenticide Act and the Toxic Substances Control Act.

 
Student Essay Contest Expanded

The ’10 Future of Southern Ag student essay contest has officially kicked off and has expanded to include all universities with accredited agriculture programs across the Southern field crops geography.

The contest, co-sponsored by Farm Press Publications and Syngenta Crop Protection, provides an opportunity for currently enrolled undergraduate and graduate students to earn scholarship prize money by submitting a 750-1,000 word essay in response to the provided topic.

To be eligible, students must be currently enrolled for the spring ’10 semester at a university with an accredited agriculture program in either Region I (Alabama, Florida, Georgia, North Carolina, South Carolina and Virginia [south of I-64]) or Region II (Arkansas, Louisiana, Mississippi, Missouri [south of I-70], New Mexico, Oklahoma, Tennessee and Texas).

More information about the essay contest is available at www.FutureofSouthernAg.com. Judging will be this summer with official winners announced in August.

 
Shipments Reach Marketing Year High

Shipments for the week ending Feb. 25 were 302,400 bales (480-lb) – a marketing year high – bringing total exports to date to 5.5 million bales, compared with the 6.6 million bales at the comparable point in the ’08-09 marketing year.

Net export sales for the week were 151,500 bales, bringing total ’09-10 sales to approximately 9.5 million bales. Total sales at the same point in the ’08-09 marketing year were approximately 10.5 million bales.

In terms of sales, China accounts for 2.9 million bales, or 30% of the total. Turkey and Mexico are the next largest customers of U.S. cotton, each purchasing 1.4 million bales. Thailand and Indonesia complete the Top 5 list of export customers.

Total new crop (’10-11) sales are 425,700 bales.

 

 
Effective March 5-11, ’10

Adjusted World Price, SLM 11/16

69.03 cents

*

Fine Count Adjustment ('08 Crop)

 1.75 cents


Fine Count Adjustment ('09 Crop)

  1.55 cents


Coarse Count Adjustment

  0.00 cents


Marketing Loan Gain Value

 0.00 cents


Import Quotas Open

13


Special Import Quota (480-lb bales)

840,756


ELS Payment Rate

11.37 cents


*No Adjustment Made Under Step I

 

Five-Day Average



Current 5 Lowest 3135 CFR Far East

85.40 cents


Forward 5 Lowest 3135 CFR Far East

NA


Coarse Count CFR Far East

NA


Current US CFR Far East

89.10 cents


Forward US CFR Far East

NA


 

'09-10 Weighted Marketing-Year Average Farm Price  
 

Year-to-Date (August-January)

60.52 cents

**


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