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August 13, 2010
 

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PAST ISSUES/ARCHIVES
 
Cotton's Week: April 12,2024
Cotton's Week: April 5, 2024
Cotton's Week: March 22, 2024
 
 


 
NCC Responds to Congressional Quarterly Distortions

The NCC issued a response, available at www.cotton.org, to a CQ Weekly cover story on US cotton policy and the US cotton industry. The response noted that the story was steeped in error, surprising bias and fallacy, and that the author used every tried and true tactic to distort the picture -- from sentence structure to carefully missing facts.

The NCC’s response pointed out that the Brazil WTO case was based on US farm policy enacted in already-expired farm laws. US cotton acreage and production have dramatically declined over the past five years due to cotton support changes, Chinese market distortions, and mandated corn ethanol demand.

“The author's attempt to link modern cotton with slavery is embarrassing to read and amazingly purposeful,” the response stated. “The CQ has retreated from an informational journal to a sensationalist approach to federal policy discussion. From wrong-headed facts (overstating average subsidies involved in the Brazil case by $1.5 billion per year), to callous disregard of facts and history (600,000 textile jobs in the US lost since 2000 as a result of competition by child-labor-produced apparel products), to complete fabrication (West African cotton producers are not, and have never been, a competitive threat to US cotton producers), to deliberate misstatement of facts (of the $829 million that Brazil is authorized to retaliate, only $147 million is due to cotton subsidies), the author and the publisher have written an article designed to distort the policy debate with respect to cotton. Of all the professed cotton experts who have written on the Brazil WTO case, only the CQ believes a one hectare West African cotton farm is competitively identical to a 10,000 acre Brazilian plantation -- an assertion that is ludicrous on its face.”

The NCC’s response emphasized that when Congress, the Administration, and the US cotton industry begin to consider new farm policy in the light of the next farm bill, “we are confident that debate will not lose sight of the importance of agriculture to America and the importance of cotton to agriculture in the United States. Hopefully, by that time, the Congressional Quarterly's hatchet job on a huge portion of rural America will just be white noise, indistinguishable from a string of one-sided, biased attacks on farm programs.”

 
USDA Sees 18.53 Million Bale US Crop

In its August crop report, USDA projects a ’10-11 US crop of 18.53 million bales. Upland production was estimated at 18.04 million bales and extra long staple (ELS) production at 498,000 bales. Harvested area was estimated at 10.63 million acres, implying a non-harvested area of 278,000 acres, based on USDA’s June acreage report. The resulting abandonment rate is roughly 2.55%. The national average yield per harvested acre was estimated to be roughly 837 pounds, 11 pounds higher than the five year average.

On a regional basis, the Southeast crop is estimated at 4.14 million bales, based on harvested acres of 2.50million and a regional average yield of 795 pounds, three pounds above the region’s five-year average. In the Mid-South, expected production is 3.68 million bales. Harvested area is estimated to be 1.85 million acres and the expected yield 956 pounds per harvested acre. The Southwest upland crop is estimated at 9.19 million bales. Expected harvested area is 5.74 million acres and the regional average yield is 769 pounds, 54 pounds above their five-year average of 715 pounds per harvested acre. Upland production in the West is an estimated 1.02 million bales with estimated harvested area of 339,000 acres and a regional average yield of 1,444 pounds, 94 pounds higher than the region’s five-year average.

The ELS crop is an estimated 498,000 bales. Harvested area is pegged at 207,000 acres with an average yield of 1,154 pounds per harvested acre.

State-level estimates are included in the accompanying table.

US Cotton Crop, ’10-11

 

PLANTED

ACRES

Thou.

HARV.

ACRES

Thou.

YIELD PER

HARV.

ACRE

Lb.

5-YEAR

AVG.

YIELD

Lb.

480-

POUND

BALES

Thou.

UPLAND

 

 

 

 

 

SOUTHEAST

2,525  

2,501 

795  

792 

4,144  

   Alabama

370  

365 

677  

653 

515  

   Florida

90  

87 

800  

771 

145  

   Georgia

1,250  

1,240 

852  

840 

2,200  

   North Carolina

570  

565 

756  

814 

890  

   South Carolina

175  

174 

800  

721 

290  

   Virginia

70  

70 

713  

879 

104  

MID-SOUTH

1,880  

1,848 

956  

915 

3,680  

   Arkansas

530  

520 

1,062  

1,011 

1,150  

   Louisiana

230  

225 

832  

872 

390  

   Mississippi

420  

410 

937  

859 

800  

   Missouri

300  

298 

983  

976 

610  

   Tennessee

400  

395 

887  

822 

730  

SOUTHWEST

5,950  

5,736 

769  

715 

9,192  

   Kansas

40  

36 

693  

602 

52  

   Oklahoma

210  

200 

816  

731 

340  

   Texas

5,700  

5,500 

768  

716 

8,800  

WEST

345  

339 

1,444  

1,350 

1,020  

   Arizona

185  

183 

1,469  

1,410 

560  

   California

125  

124 

1,490  

1,363 

385  

   New Mexico

35  

32 

1,125  

1,026 

75  

TOTAL UPLAND

10,700  

10,424 

831  

816 

18,036  

TOTAL ELS

209  

207 

1,154  

1,245 

498  

   Arizona

3  

3 

960  

891 

5  

   California

185  

184 

1,174  

1,310 

450  

   New Mexico

3  

3 

928  

825 

6  

   Texas

18  

18 

1,015  

821 

37  

ALL COTTON

10,909  

10,631 

837  

826 

18,534  

Source: USDA-NASS August Crop Production Report.

 

 

 
USDA Raises ’10-11 Export Estimate

In its August report, USDA lowered US ’09-10 cotton exports by 250,000 bales to 12.00 million. With ’09-10 production at 12.19 million bales and mill use at 3.40 million bales, ending stocks are estimated at 3.10 million bales, giving a stocks-to-use ratio of 20.1%.

For the ’10-11 marketing year, USDA sees US production at 18.53 million bales, up 230,000 bales from last month’s report. Mill use was unchanged from the July report at 3.40 million bales, while exports were raised 700,000 bales to 15.00 million bales. The estimated total offtake stands at 18.40 million bales. With beginning stocks of 3.10 million bales, this would result in US ending stocks of 3.20 million bales on July 31, ’11, and a stocks-to-use ratio of 17.4%.

USDA’s August report sees world production for the ’09-10 marketing year at 102.15 million bales, down 400,000 bales from last month. World mill use was raised 1.16 million bales to 117.71 million bales. Consequently, world ending stocks are estimated to be 47.58 million bales with a stocks-to-use ratio of 40.4%.

For the ’10-11 marketing year, USDA projects world production to be 116.85 million bales, up 830,000 bales from last month. Mill use is set at 120.87 million bales. With beginning stocks at 47.58 million bales, this would result in world ending stocks of 45.61 million bales on July 31, ’11, and a stocks-to-use ratio of 37.7%.

 
Textile Enforcement Bill Introduced in Senate

The National Council of Textile Organizations (NCTO) applauded Sens. Hagan (D-NC) and Graham (R-SC) for their introduction last week of S.3741, the Textile Enforcement and Security Act of 2010. The House version (H.R. 5393) was introduced in May by Reps. Kissell (D-NC), Jones (R-NC), Spratt (D-SC) and Coble (R-NC) and currently has 25 co-sponsors (see May 28 Cotton’s Week).

In a press statement, NCTO Chairman David Hastings said, “It is pivotal that the rules and obligations governing the trading system are enforced and we thank Senator Hagan and Senator Graham for their leadership on this critical issue. The enactment of this legislation will send a clear message -- that the U.S. government will not allow fraudulent activity on imported textile and apparel goods to continue to occur, particularly when it comes at the expense of U.S. workers and businesses.”

The statement noted that The Textile Enforcement and Security Act of 2010 legislation provides US Customs and Border Protection with expanded authority, increased resources, and enhanced tools to better facilitate the trade among legal players while more effectively targeting the bad players in the system.

“For years our industry has been plagued by high levels of fraudulent as well as undervalued goods coming into the U.S. market and has led to the loss of thousands of U.S. textile and apparel workers and the shuttering of textile mills across the country,” Hastings said.  “This legislation provides our companies and our workers with a fair and balanced playing field that is necessary in order to compete in the global marketplace.”

The US Customs and Border Protection currently collects more than $25 billion in duties annually; with 42% of those duties, nearly $11 billion, collected on imports of textile and apparel. As a result, Customs continues to designate the industry as one of the department’s priority trade issues.

 
Companion House FIFRA Bill Introduced

Ranking Member Lucas (R-OK), along with six of his colleagues on the House Agriculture Committee, introduced a bill (H.R. 6087) which clarifies that the use of a pesticide consistent with its registration under the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) should not be subject to a costly, redundant and unnecessary permit process under the Clean Water Act (CWA).

H.R. 6087 is a companion bill to S. 3735, which was introduced last week by Sens. Chambliss (R-GA) and Lincoln (D-AR) and would override the Sixth Circuit Court decision mandating CWA permits for certain pesticide uses.

In a public statement, Rep. Lucas said, "Since the passage of the Clean Water Act, the EPA had interpreted the act to exclude lawful pesticide applications. Under the Bush administration, the EPA issued a final regulation codifying this long-standing practice. The current political leadership of the EPA has chosen a different path. It is one that on a daily basis adds more and more regulatory burdens on our agricultural producers. It is now up to the Congress to fix this problem before the EPA imposes this new bureaucracy on American agriculture."

 

Texas Refuses EPA Requirements for GHG Permits

In a strongly worded letter to the EPA, the State of Texas refused to implement agency requirements to issue permits to new and modified sources of greenhouse gas emissions (GHG) under the Clean Air Act (CAA).

“On behalf of the State of Texas, we write to inform you that Texas has neither the authority, nor the intention of interpreting, ignoring, or amending its laws in order to compel the permitting of greenhouse gas emissions,” said the letter, written by Attorney General Greg Abbott and Bryan W. Shaw, chairman of the Texas Commission on Environmental Quality, to EPA Administrator Lisa Jackson.

EPA has developed a “tailoring” rule which arbitrarily increases the statutory thresholds of the CAA in order to capture only large emitters. The final tailoring rule asked that any state, which currently lacks authority under its own laws and regulations to issue permits to any greenhouse gas emissions sources, notify EPA by Aug. 2 whether it intends to revise its rules.  EPA is set to impose greenhouse gas emissions control and permitting requirements on those sources on Jan. 2, ’11 under CAA provisions. A range of states, industry organizations and environmental groups have filed lawsuits challenging the tailoring rule.

The Texas letter said that with the tailoring rule “you have substituted your own judgment for Congress's as how deep and wide to spread the permitting burden …Simultaneously, however, you recognize that permitting greenhouse gases under the Act is ‘absurd.”

In the tailoring rule, EPA said it will require permitting only for the largest sources 1) to avoid the “absurd results” of thousands of permits being issued for little benefit and 2) out of the administrative necessity that permitting agencies not be overburdened by permits for small sources.

In addition, the Texas letter asked EPA to stay the enforcement of greenhouse gas permitting requirements until court challenges are resolved.


 
CCI Promotes US Cotton at Colombiamoda ’10

The COTTON USA Sourcing Program promoted US cotton yarns and fabrics at the recent Colombiamoda trade show that attracted 8,500, including nearly 7,000 local buyers and 1,400 international buyers.

The 11 Sourcing Program member mills were featured at the COTTON USA booth and in advertising throughout the grounds of the show. Representatives of three Sourcing Program mills, Buhler Quality Yarns, Frontier Spinning Mills and Tuscarora Yarns, attended the show and visited a total of 29 Colombian textile manufacturers in Bogota and Medellin to enhance business relationships and share information about the US cotton textile industry.

At Colombiamoda, COTTON USA sponsored the launch of Aritex de Colombia’s new line of 100% cotton women’s and men’s athletic apparel featuring knit fabrics by COTTON USA licensee Fabricato Tejicondor, which are finished with Cotton Incorporated’s Wicking Windows™ technology. COTTON USA also supported the launch of Angel Yañez’s 100% cotton men’s underwear featuring knit fabrics by COTTON USA licensee Protela S.A.

Two of the largest Colombian mattress companies, Americana de Colchones and Colchones Spring, participated in the trade show under the theme “COTTON USA Sleeps with You,” a continuation of a recent media campaign carried out in conjunction with COTTON USA. The campaign is aimed to build consumer awareness of cotton-filled mattresses’ benefits in the face of a recent regulatory challenge spearheaded by synthetic mattress manufacturers.

Stephanie Hartwig and Becca Pierce of Texas Tech U.’s (TTU) College of Human Sciences, winners of the “Denim Runway” student design competition co-sponsored by Cotton Council International, Plains Cotton Cooperative Assoc., and TTU, attended to learn about the US cotton textile industry and garment manufacturing companies throughout the Western Hemisphere and to serve as ombudsmen for COTTON USA.

 
Sales Strong, Shipments Steady

Net export sales for the week ending Aug. 5 (first week of new marketing year) were 356,600 bales (480-lb). Combined with outstanding sales of approximately 1.8 million bales on July 31 that were carried forward and ’10-11 sales of 3.7 million bales made in the previous marketing year brings total ’10-11 sales to approximately 5.9 million bales.

Total sales at the same point in the ’09-10 marketing year were approximately 2.6 million bales. Total new crop (’11-12) sales are 148,100 bales.

Shipments for the week were 184,800 bales, bringing total exports to date to 184,800 bales, compared with the 138,300 bales at the comparable point in the ’09-10 marketing year.

 

 
Effective Aug. 13- 19, ’10

Adjusted World Price, SLM 11/16

70.63 cents

*

Fine Count Adjustment ('09 Crop)

 0.35 cents


Fine Count Adjustment ('10 Crop)

  0.45 cents


Coarse Count Adjustment

  0.00 cents


Marketing Loan Gain Value

 0.00 cents


Import Quotas Open

3


Special Import Quota (480-lb bales)

202,795


ELS Payment Rate

0.00 cents


*No Adjustment Made Under Step I

 

Five-Day Average



Current 5 Lowest 3135 CFR Far East

87.47 cents


Forward 5 Lowest 3135 CFR Far East

NA


Coarse Count CFR Far East

NA


Current US CFR Far East

89.60 cents


Forward US CFR Far East

NA


 

'09-10 Weighted Marketing-Year Average Farm Price  
 

Year-to-Date (Aug.-June)

62.10 cents

**


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