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April 29, 2011
 

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President Signs H.R. 4 into Law

President Obama signed into law H.R. 4, the “Comprehensive 1099 Taxpayer Protection and Repayment of Exchange Subsidy Overpayments Act of 2011,” which repeals the expansion of requirements for businesses to report information to the IRS on payments for goods of $600 or more annually to other businesses.

President Obama said, “…. I was pleased to take another step to relieve unnecessary burdens on small businesses by signing H.R. 4 into law. Small business owners are the engine of our economy and because Democrats and Republicans worked together, we can ensure they spend their time and resources creating jobs and growing their business, not filling out more paperwork.”

Earlier this month the Senate voted 87-12 to repeal the requirement after the House adopted the measure, 314-112, in March. Because the House and Senate approved identical legislation, the bill went to the President.

The Form 1099 provision was set to begin in ’12. The government planned to tax revenues reported on 1099 forms to raise money to fund health care reform.

 
Clean Water Act Draft Guidance Released

EPA and the Army Corps of Engineers (the Corps) released draft guidance that has been under review at the White House since December. The guidance seeks to expand the scope of the Clean Water Act (CWA) as compared to Bush administration interpretations of two Supreme Court decisions that have created confusion over when isolated wetlands, ephemeral streams and other marginal waters are subject to CWA requirements.

News of the guidance's development generated intense criticism from industry and on Capitol Hill, where 170 House lawmakers earlier this month sent a letter to EPA Administrator Lisa Jackson urging her to reconsider the guidance and pursue any CWA jurisdiction changes through a formal rulemaking. State water regulators and a top Justice Department official also have said that modifications of the CWA's scope are best pursued through rulemaking.

The agency now says it will launch a rulemaking. "After receiving and taking account of public comments on this document, EPA and the Corps expect to finalize it and to undertake rulemaking consistent with the Administrative Procedure Act,” the document states.

The released guidance is less onerous than a draft leaked to the press earlier this year which stated that the extent of protected waters would "increase significantly" under the new policy. The released proposal, instead, notes the guidance is "not a rule, and hence it is not binding and lacks the force of law."

Despite these modifications, the guidance will increase the CWA’s scope. For example, EPA is proposing that the definition of traditional navigable waters now also include waters currently being used for commercial waterborne recreation (e.g. boat rentals, guided fishing trips or water ski tournaments) or that are susceptible to being used in the future for commercial navigation, including commercial waterborne recreation. Interstate waters will include lakes, ponds and similar still water features crossing state boundaries and be considered jurisdictional as interstate waters in their entirety.

The NCC and other commodity organizations are concerned that the guidelines have the potential to expand federal jurisdiction in a way that could lead to additional permitting requirements and make farmers more vulnerable to citizen action lawsuits. The guidance leaves open the option of future interpretation because of the absence of specific farming practices regarded as ‘normal’ and the use of the term “generally not protected by the Clean Water Act.”

EPA is requesting public comments on this proposal for 60 days after its publication in the May 2 Federal Register. More information on this guidance is at: http://water.epa.gov/lawsregs/guidance/wetlands/CWAwaters.cfm.

 
NCC’s Performance and Standards Task Force Meets

The NCC’s Performance and Standards Task Force, chaired by Bobby Greene, a ginner from Courtland, AL, met in Memphis. The Task Force’s discussions focused on concepts to operationalize the intent of NCC resolutions dealing with appropriate rewards for exceptional warehouse service and penalties for nonperformance.

The list of proposals put forth during the meeting is being circulated to all NCC interest organizations. The Task Force expressed the intent to bring recommendations on these issues to the NCC’s Board of Directors during its August meeting.

 
USDA NIFA Director Resigns

Dr. Roger Beachy, who became the director of USDA’s Cooperative State Research, Education, and Extension Service (CSREES) in Oct. ’09 and led the reorganization which transformed the agency into the National Institute of Food and Agriculture (NIFA) in ’10, has resigned, effective May 20, ’11, according to Research, Education and Economics Under Secretary Cathie Woteki.

In a memo to staff, Woteki said it was “with regret” that she and Secretary Vilsack accepted his resignation. In the interim, Dr. Chavonda Jacobs-Young, currently director of USDA’s Office of the Chief Scientist, will serve as Acting Director of NIFA. Woteki announced that a search for a new director of outstanding scientific and management credentials will be launched immediately.

Beachy was the founding president of the Donald Danforth Plant Science Center, a not-for-profit research institute with a mission to improve the human condition through plant science, in St. Louis. He is a member of the National Academy of Sciences and internationally known for his groundbreaking research on developing virus-resistant plants through biotechnology. From ’91-98, he headed the Division of Plant Biology at The Scripps Research Institute in La Jolla, CA. He was also Professor and Scripps Family Chair in Cell Biology and co-director of the International Laboratory for Tropical Agricultural Biotechnology at Scripps.

 
NCC Supports New Aldicarb Registration

The NCC recently submitted comments supporting a registration request from Ag Logic LLC for a generic aldicarb product, MEYMIK 15G. The registration request includes uses on cotton, dry beans, peanuts, soybeans, sugar beets and sweet potatoes.

Ag Logic LLC, a subsidiary of MEY Corp., submitted its registration request in Oct. ’10. On March 30, ’11, EPA published a Federal Register notice seeking public comment on the proposed registration under the Docket No. EPA-HQ-OPP-2010-1021.

Since its introduction 40 years ago, aldicarb has been a key tool in cotton production for control of early season insect and nematode populations as well as for lygus control. Alternative products are unable to achieve comparable levels of control or cost effectiveness when compared to aldicarb for these pests.

The NCC comments stressed the importance of this product for producers and referred to research presented at the ’11 Beltwide Cotton Conferences that evaluated the effects on cotton yields in the product’s absence. Over a five-year period, cotton yields from untreated control plots were compared to plots treated with aldicarb. Plots treated with aldicarb produced an additional 198 pounds of cotton fiber per acre and an additional 297 pounds of cottonseed.

Based on this research and the assumption that 25% of US cotton acres are treated with aldicarb each year, ’11 production losses due to aldicarb’s absence are valued at $816 million.

 
’11 Beltwide Proceedings Mailed

The CD of the ’11 Beltwide Cotton Conferences Proceedings was mailed to those meeting attendees who requested them.

Beltwide attendees, NCC members and Cotton Foundation members also may access the Proceedings on the Beltwide website at www.cotton.org/beltwide/index.cfm?page=proceedings.

 
Turkish Manufacturers Touring US Cotton Belt

Eleven textile industry leaders from Turkey will tour the US Cotton Belt on May 7-17 as part of a COTTON USA Special Trade Mission. Sponsored by the Cotton Council International, the event is designed to build trading ties between the US cotton industry and textile industry leaders from key Turkish mills.

“These textile executives will view the advanced state of the U.S. industry and have the opportunity to meet with U.S. cotton exporters and other industry leaders,” said CCI President John Mitchell, a Cordova, TN, merchant. “This is an important opportunity for U.S. cotton because the individual mills on the tour consume a total of more than 570,000 bales, with U.S. imports of about 345,000 bales.

Mitchell noted that Turkey is: 1) the world’s fourth largest cotton consumer with an estimated total domestic consumption of 5.9 million bales in ’10-11; 2) the world’s third largest importer of cotton, with 3.2 million bales estimated for ’10-11; and 3) the second largest customer of US cotton – with the 2.2 million plus bales of US cotton that country already has imported in ’10-11.

The Turkish group will begin their tour activities in New York City with a briefing from CCI on May 8 and a seminar with ICE Futures on May 9. Later that day in Raleigh, NC, they will meet with representatives of AMCOT, the Southern Cotton Growers, Inc. and Cotton Incorporated, whose headquarters in nearby Cary they will tour the next day.

After attending the American Cotton Shippers Assoc. annual meeting in Washington, DC, on May 11, the group will travel to Memphis where they will tour the USDA classing office and have meetings with NCC staff at its headquarters and with AMCOT. On May 13, the contingent will be in Lubbock for a meeting with the Lubbock Cotton Exchange, AMCOT, the Texas Cotton Assoc. and Plains Cotton Growers, Inc. The tour will conclude in California on May 16 with a meeting in Bakersfield with the Western Cotton Shippers Assoc., AMCOT, the San Joaquin Valley Quality Cotton Growers Assoc. and Supima.

The mills represented on the tour are Abateks, Aral Tekstil, Bossa, Gap Guneydogu, Has Cevher, Ilsan, Karacasu, Malatya Iplik, Markeks, Mina Texstil and Ozcicek.

 
US Mill Cotton Use Steady

According to the Commerce Dept., March (five-week month) total cotton consumption in domestic mills was 165.6 million pounds for a seasonally adjusted annualized rate of 3.68 million bales (480-lb). Last year’s March annualized rate was 3.37 million bales.

The February (four-week month) estimate of domestic mill use of cotton was lowered by 3.8 million pounds to 139.1 million. The revised seasonally adjusted annualized rate of consumption for February is 3.76 million bales. The previous year’s February annualized rate was 3.45 million bales.

Based on Commerce estimates from Aug. 1, ’10-April 2, ’11, projected total pounds consumed during crop year ’10-11 would be 1.8 billion pounds or 3.72 million bales. USDA’s latest estimate of ’10-11 crop year mill use is 3.7 million bales. Preliminary April domestic mill use of cotton and revised March figures will be released by Commerce on May 26.

 
Sales Weak, Shipments Stay Strong

Net export sales for the week ending April 21 were -40,100 bales (480-lb). This brings total ’10-11 sales to approximately 15.7 million bales. Total sales at the same point in the ’09-10 marketing year were approximately 11.3 million bales. Total new crop (’11-12) sales are roughly 5.6 million bales.

Shipments for the week were 371,500 bales, bringing total exports to date to 11.1 million bales, compared with the 7.9 million bales at the comparable point in the ’09-10 marketing year.

 

 
Effective April 29-May 5, ’11

Adjusted World Price, SLM 11/16

 163.23 cents

*

Fine Count Adjustment ('09 Crop)

 0.20 cents


Fine Count Adjustment ('10 Crop)

  0.30 cents


Coarse Count Adjustment

  0.00 cents


Marketing Loan Gain Value

 0.00 cents


Import Quotas Open

0


Special Import Quota (480-lb bales)

0


ELS Payment Rate

0.00 cents


*No Adjustment Made Under Step I

 

Five-Day Average



Current 5 Lowest 3135 CFR Far East

180.07 cents


Forward 5 Lowest 3135 CFR Far East

145.92 cents


Coarse Count CFR Far East

NA


Current US CFR Far East

187.67 cents


Forward US CFR Far East

147.83 cents


 

'10-11 Weighted Marketing-Year Average Farm Price  
 

Year-to-Date (Aug.-March)

81.39 cents

**


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