CURRENT ISSUE ARTICLES

AGI Notices Being Sent to Producers

CRP General Sign-Up Deadline Extended

Integrity of Research/Promotion Programs Bolstered

EPA Sued Regarding Mississippi River Nutrients

4th COTTON USA Cotton School Convenes in China

4th COTTON USA Cotton School Convenes in China

Shipments Reach Marketing Year High

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AGI Notices Being Sent to Producers

USDA recently announced that letters will be mailed to certain producers which will require them to re-verify their compliance with Adjusted Gross Income (AGI) test requirements for either '09 or '10.

Producers who receive these letters will be instructed to contact their state Farm Service Agency (FSA) state office and provide either a signed statement from a CPA or an attorney that verifies their average AGI did not exceed the applicable AGI limitations. They also may work with their state office records and demonstrate they are in compliance through their federal tax returns that were filed with the IRS for the applicable years.Producers will have 30 days to contact their FSA state offices.

These letters are part of the AGI verification process that identified producers flagged by the IRS because their AGI potentially exceeds limits set in the farm law. The letter will have the contact information, including telephone number and address of their FSA state office. If producers have any questions, they should call their state office.

CRP General Sign-Up Deadline Extended

USDA Farm Service Agency (FSA) Administrator Bruce Nelson announced that the sign-up deadline for the Conservation Reserve Program (CRP) has been extended to April 13, '12.

"Due to strong interest in CRP, the decision was made to extend CRP sign-up 43 for an additional week," Nelson said. "I encourage all eligible farmers and ranchers to take advantage of this opportunity to participate in CRP. Whether new enrollees or re-enrolling existing CRP contracts, producers who sign up for CRP help to conserve land and improve our soil, water, air and wildlife habitat resources."

After the CRP general sign-up ends on April 13, FSA will evaluate offers based on cost and the Environmental Benefits Index (EBI). The EBI takes into consideration variables such as wildlife habitat, water quality protection, soil erosion reduction, air quality protection and other enduring benefits. Accepted offers will become effective on Oct. 1, '12.

CRP is a voluntary program available to agricultural producers to help them use environmentally sensitive land for conservation benefits. Producers enrolled in CRP plant long-term, resource-conserving covers to improve the quality of water, control soil erosion and develop wildlife habitat. In return, USDA provides participants with rental payments and cost-share assistance. Contract duration is between 10 and 15 years. Producers with expiring contracts and producers with environmentally sensitive land are encouraged to evaluate their options under CRP. Currently, about 30 million acres are enrolled in CRP. The program continues to make major contributions to national efforts to improve water and air quality, prevent soil erosion by protecting the most sensitive areas including those prone to flash flooding and runoff. CRP has helped increase populations of pheasants, quail, ducks, and other rare species, like the sage grouse, the lesser prairie chicken, and others. CRP highlights:

·CRP has restored more than 2 million acres of wetlands and 2 million acres of riparian buffers;

·Each year, CRP keeps more than 600 million pounds of nitrogen and more than 100 million pounds of phosphorous from flowing into our nation's streams, rivers, and lakes.

·CRP provides $1.8 billion annually to landowners—dollars that make their way into local economies, supporting small businesses and creating jobs.

·CRP is the largest private lands carbon sequestration program in the country. By placing vulnerable cropland into conservation, CRP sequesters carbon in plants and soil, and reduces both fuel and fertilizer usage. In '10, CRP resulted in carbon sequestration equal to taking almost 10 million cars off the road.

Producers are encouraged to contact their local FSA service center or visit FSA's website at http://www.fsa.usda.gov/crp for additional information regarding CRP.

Integrity of Research/Promotion Programs Bolstered

The Office of the Inspector General (OIG) recently released its review of the USDA Research and Promotion programs, which USDA's Agricultural Marketing Service (AMS) requested in '10 to help the agency better identify potential oversight improvements. In a news release, USDA said AMS is committed to good stewardship of the producer-funded Research and Promotion programs and already has begun implementing the OIG's recommendations.

The OIG review was conducted in '10-11 to assess AMS oversight of Research/Promotion activities, and the review focused on AMS internal controls and the oversight of Research/Promotion boards' activities. After reviewing current procedures, the OIG made two recommendations that AMS will implement: (1) AMS will strengthen internal controls related to its oversight of board activities and develop Standard Operating Procedures (SOP); and (2) AMS will develop guidance to conduct periodic internal reviews of its progress in strengthening oversight.

In advance of OIG's final report, AMS began implementing potential recommendations by taking the following decisive actions to strengthen its oversight duties: 1) revising its guidelines in Nov. '10 by reinforcing its management reviews of boards and strengthened policies on various administrative functions; 2) finalizing the AMS SOP to ensure consistency in staff responsibilities in Jan. '12; and 3) implementing periodic internal reviews of the agency's Research and Promotion programs to evaluate and ensure consistency in the application of its policies and responsibilities.

In addition to the specific recommendations offered in the OIG report, AMS is announcing a new policy that will strongly encourage upfront referendums as the preferable process for establishing all future Research/Promotion programs. This will allow more direct engagement from interested stakeholders and the public prior to the establishment of a potential program, and conform to the Department's overall mission to provide additional transparency to the Research/Promotion programs.

Cotton Board Chairman John Clark, a Los Angeles, CA, importer, praised AMS oversight activities, citing his experience of working with the Agency as well as the OIG review.

In the Cotton Board's release, he stated, "Over the years I have come to appreciate the dedication and thoroughness of AMS officials who work directly with the Cotton Board. AMS officials attend our meetings, routinely review contacts, financial statements and other operational documents, and cooperatively engage the Board Members as we carry out our work. AMS oversight helps the Cotton Board implement the Cotton Research and Promotion Program in accordance with law and ensures we safeguard and effectively utilize stakeholder funds."

Clark noted that the OIG review made only two concrete recommendations regarding AMS oversight. "The relative lack of recommendations on the part of OIG is a clear signal that AMS is carrying out its oversight role extremely well," he said.

AMS oversees 19 Research and Promotion programs. These industry-funded programs have been in existence since '66 and empower farmers and ranchers to leverage their own resources to develop new markets, strengthen existing markets and conduct important research and promotion activities. AMS provides an oversight and audit function, paid for by the industry assessments, which ensures fiscal responsibility, program efficiency and fair treatment of participating stakeholders.

EPA Sued Regarding Mississippi River Nutrients

Several environmental groups, including the Gulf Restoration Network and the Natural Resources Defense Council, are suing EPA to address discharge limits of fertilizers and other contaminants into the Mississippi River, which they claim create a hypoxic or "dead" zone the size of Massachusetts in the Gulf of Mexico.

The lawsuit involves a petition the environmental groups filed in '08 that asked EPA to establish numeric nutrient criteria standards in 10 states within the Mississippi River Basin and other areas affecting the Gulf of Mexico. EPA responded to the petition indicating they agreed that harm was occurring but that the agency was addressing the problem by working with the states.

The environmentalists are claiming in the litigation that there is overwhelming evidence of existing harm as a result of nutrients and that EPA has admitted to it within the petition response and therefore EPA is required to act. There is a risk that this litigation could trigger a court mandate for EPA to develop federal numeric nutrient criteria.

The Mississippi River is the largest river system in North America. Its basin stretches from the Rocky Mountains in the west all the way to New York State in the east and drains all or part of 31 states.

4th COTTON USA Cotton School Convenes in China

More than 160 representatives from 88 cotton textile companies in China, Hong Kong and Southeast Asia heard the latest US cotton market information recently at the fourth COTTON USA Cotton School in Qingdao, China. This school is designed to provide participants with a comprehensive understanding of the US cotton industry in terms of planting, production, classification, trade, contract sanctity and purchasing of raw cotton. It has been held in China once every two years since '06.

Keynote speakers included the China Cotton Assoc. executive vice president who spoke about the current cotton supply and demand issue, as well as the reserve status in the domestic Chinese market. In addition, the director of the China Textile Economics Research Center offered an analysis of China's textile industrial development and prospects.

NCC President/ CEO Mark Lange delivered a detailed presentation on current cotton industrial development trends in the US and global market, as well as US cotton ginning practices. Representatives from the American Cotton Shippers Assoc., AMCOT, Cotton Incorporated, Supima, USDA, Hansae Korea, Thai Alliance and Zibo Lanyan also made presentations.

Some of the largest textile manufacturers from China, Hong Kong, Taiwan, Thailand and Vietnam participated in this year's Cotton School. On post-event questionnaires, all participants commented that the Cotton School program is informative, constructive and productive with practical value.

Western Ginner School Registrations Sought

Registrations are being sought for the '12 Western Ginner Schools set for Las Cruces, NM, on May 8-10. Online registration is atwww.cotton.org/ncga/ginschool/index.cfm.  More than 145 participated in the Southwest school, held last week in Lubbock. The Stoneville Ginners School is set for Stoneville, MS, on June 12-14. All schools are conducted at the USDA ginning laboratories.

National Cotton Ginners' Assoc. (NCGA) Executive Vice President Harrison Ashley said the Level I, II and III courses run concurrently from 8 am–5 pm each day. He said each level of the coursework is built on the previous level of instruction, with Level I serving as the foundation. It is recommended that all new students, regardless of gin experience, start with Level I.

Level I courses are: Introduction to Cotton Ginning and the Industry; Maintenance of Auxiliary Gin Components; Basic Hydraulics; Basic Gin Safety; Maintenance and Adjustments for Seed Cotton Cleaners, Gin Stands, and Lint Cleaners; Air Utilization and Drying; and Electricity in the Gin.

The Level II offerings include: Purpose and Operating Principles of Individual Gin Machines; Efficient Operation, Adjustment, and Maintenance of Gin Equipment; Pneumatics and Waste Collection; Electrical Systems; Hydraulic Systems; Gin Safety; Management Tips; and Roller Ginning (at the Western School only).

Level III features: Review of Functions of a Ginning System; Electrical Systems; Air Systems in the Gin; Drying and Moisture Restoration Systems; Matching Machinery Capacities in the System; Seed Cotton Unloading Systems and Management of Seed Cotton Handling Systems; Bale Presses and Hydraulic Systems; Safety Programs and Labor Regulations; Cottonseed Handling Systems; and Roller Ginning (at the Western School only).

In addition to Levels I, II and III, the ginner schools feature a two-day continuing education (CE) course for certified ginners and gin managers/superintendents.The two-dayCE course at the Western school will be held on Tuesday and Wednesday, May 8-9.

A summary of CE topics at the Western school follows:

·A session on all aspects of air -- from the module feeder to cyclones -- which will feature several problem-solving presentations, including proper fan sizing and efficient operation

·Computer and phone applications to assist ginners with module logistics and gin equipment monitoring

·A review of automatic bale strapping, tying and bagging systems

·A presentation by ginner Dwayne Alford about the use of facial recognition for payroll records

·A session on safety and maintaining a safe work environment

School cooperators include USDA's Agricultural Research Service, USDA Extension Service, NCGA and its member associations, NCC, Cotton Incorporated, gin machinery/equipment manufacturers and suppliers, Cooperative State Research, Education and Extension Services, and select land grant universities. For more information, contact NCGA at (901) 274-9030 or www.cotton.org/ncga/ginschool/index.cfm.

Shipments Reach Marketing Year High

Net export sales for the week ending March 29 were -143,100 bales (480-lb). This brings total '11-12 sales to approximately 11.9 million bales. Total sales at the same point in the '10-11 marketing year were approximately 15.9 million bales. Total new crop ('12-13) sales are 943,900 bales.

Shipments for the week were 435,300 bales – a marketing year high – bringing total exports to date to 7.2 million bales, compared with the 10.0 million bales at the comparable point in the '10-11 marketing year.

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