CURRENT ISSUE ARTICLES

NCC Commends RMA on STAX Implementation

ACP/Cotton Foundation Convene

Cotton Foundation Trustees Meet

NCC Mid-Year Meeting Set

Majority of ESA Megasuit Claims Dismissed

USDA Raises '14 Cotton Crop Estimate

USDA Raises Export Projection

EPA Shuffles Staff

Southeast Producers Seeing Texas Operations

Sales, Shipments Steady

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NCC Commends RMA on STAX Implementation

The NCC commended USDA’s Risk Management Agency (RMA) after it announced the Stacked Income Protection Plan (STAX) will be available to upland cotton producers through the federal crop insurance program beginning with the ’15 crop year.

NCC Chairman Wally Darneille said, “We appreciate RMA’s timely implementation of STAX and for making it available for upland cotton in all counties where federal crop insurance coverage for upland cotton is currently offered. This will provide our nation’s cotton farmers with a solid risk management mechanism so they can continue producing safe, abundant, and affordable food and fiber.”

In its announcement, USDA said it wanted to make as much information available now to assist with farmers’ risk management planning. It said STAX is one of several new risk management options created by the ’14 farm law that will help protect farmers from events beyond their control such as weather disasters.

USDA’s announcement also noted that STAX is an area-based revenue policy that may be purchased on its own, or in conjunction with another companion upland cotton crop insurance policy. As a general matter, STAX may begin paying when revenue drops below 90% of the expected revenue for the area and a full indemnity may be payable when area revenue falls below 70% of the expected level. The amount of actual coverage and indemnity received by a producer will depend on the producer’s choices. Producers should consult with their crop insurance agents to find the coverage that best suits their needs. STAX will offer practice-specific irrigated and non-irrigated coverage as data are available.

Information on STAX for the ’15 crop year is available on RMA’s website at www.rma.usda.gov.

ACP/Cotton Foundation Convene

The American Cotton Producers (ACP), chaired by Bowen Flowers of Mississippi, met in Savannah, GA, in conjunction with The Cotton Foundation's annual meeting, presided over by its president, David Grant, a North Carolina producer. Reports covered a wide range of industry issues, including farm law implementation.

Brandon Willis, administrator of USDA's Risk Management Agency (RMA), along with Griffin Schnitzler from the Kansas City Office, provided an overview of crop insurance implementation authorized by the '14 farm law. RMA announced the details of the STAX program for '15 immediately following this meeting (see previous article). Their report provided a detailed summary of provisions of STAX including some examples of county groupings and rating. They reported that more details will be forthcoming in the next two months. NCC staff indicated that once these specifics were announced, the NCC would conduct additional educational efforts across the Cotton Belt.

During the ACP meeting presentation on crop insurance implementation, Administrator Willis reiterated earlier reports that RMA would be unable to implement the APH yield adjustment provision contained in the '14 farm law for the '15 crop. While producers greatly appreciate the efforts of RMA to ensure STAX and Supplemental Coverage Option implementation along with the ability to insure enterprise units and individual coverage levels by practice availability for '15, concerns remain about not having the APH adjustment available until the '16 crop. The ACP will recommend that the NCC continue to urge the implementation of the APH yield adjustment provision for cotton for the '15 crop.

NCC staff reported on the regulatory issues regarding the proposed changes to the Clean Water Act and the Worker Protection Standards. Staff also updated the leadership on the possible pesticide label restrictions under consideration by the EPA relative to honey bee protection. Another important topic discussed was the regulatory process currently underway for the auxin traits and accompanying chemistry for cotton, corn and soybeans. Dow AgroScience and Monsanto are currently going through this regulatory process within USDA and EPA regarding 2,4-D and Dicamba resistant trait cotton, corn and soy varieties, respectively. The NCC is concerned because of two precedent-setting criteria being proposed by EPA.

ACP Chairman Flowers recently participated in a session with EPA along with NCC staff and Monsanto representatives to express cotton's concerns about the proposed geographic restrictions and mandatory weed resistance label proposals for the herbicide labels for Dicamba-traited cotton varieties. The NCC will continue monitoring this regulatory process.

ACP/Foundation meeting attendees also participated in a tour of the Port of Savannah hosted by the Georgia Port Authority.

Cotton Foundation Trustees Meet

The Cotton Foundation Board of Trustees elected officers and approved funding for 20 general research projects totaling $319,500. Approved projects include studies related to pest management, sustainability, pollinator protection, fiber quality, agronomic practices and education.

The Trustees' approval followed the Cotton Foundation's annual membership meeting in conjunction with the American Cotton Producers meeting in Savannah, GA. David Grant, a Garysburg, NC, producer, was elected Foundation chairman for '14-15. Kirk Gilkey, a Corcoran, CA, producer/ginner, was elected president. Other elected Cotton Foundation officers are: Mark Lange, executive vice president; Bill Norman, executive director/secretary; Doug Rushing, allied industry trustee with Monsanto, treasurer; and Buzz Shellabarger, assistant treasurer.

Foundation trustees elected by the membership for '14-15 include producers: Ben Guthrie, Newellton, LA; Mike Alexander, Colorado City, TX; and Gill Rogers, Hartsville, SC; and allied industry members: Mark Lindsey, DuPont Crop Protection; John Freed, Syngenta; Matthew Rekeweg, Dow AgroSciences; Alan Ayers, Bayer CropScience; Jim Sieleman, John Deere; Charles Whitt, BASF; and Amanda Bell, Case IH.

NCC Mid-Year Meeting Set

The NCC will conduct its Mid-Year Board of Directors meeting on Aug. 20-22 at the Peabody Hotel in Memphis, TN.

NCC Board committees will meet on Wednesday afternoon, Aug. 20, and on Thursday morning, Aug. 21. Cotton Council International's (CCI) Board of Directors meets on Thursday morning, followed by the NCC Board's open session that afternoon. The open session will include reports by NCC Chairman Wally Darneille, Committee for the Advancement of Cotton Chairman Bobby Greene, and CCI President Jordan Lea. The open session also will feature an address by Karis T. Gutter, USDA Deputy Undersecretary for Farm and Foreign Agricultural Services, and an election report from David Wasserman, political analyst and house editor for the Cook Political Report.

On Friday morning, Aug. 22, the Board will convene in executive session. Included will be reports from several NCC committee chairmen as well as American Cotton Producers Chairman Bowen Flowers.

Majority of ESA Megasuit Claims Dismissed

A federal magistrate judge dismissed most claims asserted by the Center of Biological Diversity (CBD) and the Pesticide Action Network (Plaintiffs) in what is known as "the ESA megasuit" case.

Of the 306 pesticides originally included in the case, plaintiffs have been given 30 days to file amended complaints on just 11 of those, with the remainder of the claims dismissed on jurisdictional or statutory grounds. The pesticides at issue include these active ingredients: brodifacoum, bromethalin, cypermethrin, dazomet, dimethoate, malathion, mancozeb, permethrin, simazine, warfarin and zinc phosphide.

In Jan. '11, the CBD and Plaintiffs filed suit against EPA for failing to consult with the Fish and Wildlife and National Marine Fisheries Service regarding the effects of 306 registered pesticides on 216 endangered species throughout the United States (hence the name "Megasuit"). Seventeen of the listed pesticides are the most commonly used agricultural pesticides, such as 2,4-D, aldicarb, atrazine, methyl bromide and its alternatives.

Plaintiffs asked the court to require EPA to initiate and complete the consultation process, and to compel EPA to restrict pesticide uses that may result in their entering endangered species' occupied or critical habitat until the consultation process is complete. This action would have disrupted every type of agriculture – from row crops to specialty crops – nationwide. Because of this potential impact on agriculture, the NCC, American Farm Bureau Federation, National Alliance of Forest Owners, National Corn Growers Assoc., National Agricultural Aviation Assoc., the Washington Farm Forestry Assoc., USA Rice, National Council of Farmer Cooperatives and CropLife America all were granted status as interveners in order to participate in settlement discussions.

The Court twice has ruled that Plaintiffs must refine their complaint by identifying each specific EPA action they believe triggered the ESA consultation provisions and the date of that action. The Court's recent opinion significantly narrows the lawsuit and reduces its possible impact on agriculture. It remains to be seen how Plaintiffs will amend their complaint.

USDA Raises '14 Cotton Crop Estimate

In its August crop report, USDA estimated a '14-15 US crop of 17.50 million bales, up 1.00 million bales from the previous month. Upland production was estimated at 16.95 million bales and extra-long staple (ELS) production at 556,000 bales.

Harvested area was an estimated 10.24 million acres, implying a non-harvested area of roughly 1.13 million acres based on USDA's revised June acreage report. The resulting abandonment rate is 9.92%. The national average yield per harvested acre was estimated to be 820 pounds, one pound higher than the five-year average.

On a regional basis, the Southeast crop is estimated at 5.40 million bales, based on harvested acres of 2.74 million and a regional average yield of 945 pounds, 98 pounds more than the region's five-year average.

In the Mid-South, expected production is 3.27 million bales. Harvested area is estimated to be 1.43 million acres and the expected yield is 1,096 pounds per harvested acre, 147 pounds more than the region's five-year average.

The Southwest upland crop is estimated at 7.54 million bales. Expected harvested area is 5.66 million acres and the regional yield is 639 pounds, nine pounds below the five-year average.

Upland production in the West is an estimated 746,000 bales with an estimated harvested area of 231,000 acres and a regional average yield of 1,550 pounds, 66 pounds more than the region's five-year average.

The ELS crop is an estimated 556,000 bales. Harvested area is pegged at 176,000 acres with an average yield of 1,517 pounds per harvested acre.

State-level estimates are provided in the accompanying table.

US Cotton Crop, '14-15
	PLANTED ACRES Thou.	HARV. ACRES Thou.	YIELD PER HARV. ACRE Lb.	5-YEAR AVG. YIELD Lb.	480- POUND BALES Thou.
UPLAND
SOUTHEAST	2,763	2,742	945	847	5,400
Alabama	375	373	894	773	695
Florida	115	114	926	756	220
Georgia	1,450	1,440	967	883	2,900
North Carolina	470	465	939	824	910
South Carolina	265	263	876	847	480
Virginia	88	87	1,076	880	195
MID-SOUTH	1,460	1,430	1,096	949	3,265
Arkansas	360	350	1,193	986	870
Louisiana	200	195	1,157	903	470
Mississippi	400	395	1,130	972	930
Missouri	250	245	1,087	1,002	555
Tennessee	250	245	862	854	440
SOUTHWEST	6,733	5,662	639	648	7,535
Kansas	43	42	686	660	60
Oklahoma	240	220	818	682	375
Texas	6,450	5,400	631	647	7,100
WEST	235	231	1,550	1,484	746
Arizona	140	139	1,606	1,499	465
California	65	64	1,650	1,595	220
New Mexico	30	28	1,046	1,083	61
TOTAL UPLAND	11,191	10,065	808	804	16,946
TOTAL ELS	178	176	1,517	1,407	556
Arizona	10	10	1,200	1,001	25
California	150	149	1,611	1,458	500
New Mexico	5	5	686	852	7
Texas	13	12	960	917	24
ALL COTTON	11,369	10,241	820	819	17,502
Source: USDA-NASS August Crop Production Report.

USDA Raises Export Projection

In its August report, USDA sees mill use unchanged at 3.80 million bales while exports were raised 500,000 bales from last month to 10.70 million bales. Projected total offtake is 14.50 million bales. With beginning stocks of 2.60 million bales, this would result in US ending stocks of 5.60 million bales on July 31, '15, and a stocks-to-use ratio of 38.6%.

For the '13-14 marketing year, USDA puts US production at 12.91 million bales. Mill use is unchanged from the previous month at 3.60 million bales while exports were raised 30,000 bales to 10.53 million bales. The estimated total offtake now stands at 14.13 million bales, generating ending stocks of 2.60 million bales and a stocks-to-use ratio of 18.4%.

The August report projects world production for the '14-15 marketing year to be 117.64 million bales, up 1.22 million bales from the July report. World mill use was raised 1.26 million bales to 112.60 million bales. With beginning stocks at 99.96 million bales, this would result in world ending stocks of 105.08 million bales on July 31, '15, and a stocks-to-use ratio of 93.3%.

For the '13-14 marketing year, USDA lowered world production 60,000 bales from the previous month to 118.27 million bales. Mill use is estimated at 108.42 million bales, 40,000 bales less than the previous month. Consequently, world ending stocks are estimated to be 99.96 million bales with a stocks-to-use ratio of 92.2%.

EPA Shuffles Staff

EPA named Lisa Feldt as the Acting Deputy Administrator, replacing the outgoing Bob Perciasepe who will become the director of the advocacy group, Center for Climate and Energy Solutions.

Feldt was formerly the deputy assistant administrator for EPA's solid waste and emergency response office where she focused on policies related to methane emissions. It is expected that she will serve the remainder of her appointment in an acting capacity as a Senate confirmation would be difficult.

Arvin Ganesan, formerly associate administrator for EPA's congressional affairs and intergovernmental relations office, has been moved to the position of deputy chief of staff for policy.

According to the agency, Feldt and Ganesan will focus on a range of issues across EPA "in an effort to streamline our processes, maximize efficiency and identify opportunities to highlight activities that provide the greatest on the ground environmental benefit."

Southeast Producers Seeing Texas Operations

Twelve cotton producers from the Southeast will see cotton and other agriculture-related operations in Texas on Aug. 18-21 as part of the NCC's '14 Producer Information Exchange (PIE).

Sponsored by Bayer CropScience through a grant to The Cotton Foundation, the PIE program is in its 26th year of helping its US producer participants improve yields and fiber quality. The program aims to help cotton producers boost their overall operation's efficiency by: 1) gaining new perspectives in such fundamental practices as land preparation, planting, fertilization, pest control, irrigation and harvesting and 2) observing the unique ways in which their innovative peers are using current technology.

The Southwest tour participants are: Alabama – Rich Lindsey, Jr., and Brandon Young, both of Centre; Georgia – Jason Cox, Pelham; Russ Williams, Leary; and Austin Warbington, Pinehurst; North Carolina – William Dunlow, Roanoke Rapids; and Mark Grant, Garysburg; South Carolina – Dean Hutton, Holly Hill; Stewart Perrow, St. Matthews; and Lee Rogers, Bishopville; Virginia –Wyatt Cox, Waverly; and William Kirven, IV, Darlington.

Their tour will begin on Aug. 18 in Lubbock with a visit to Bayer CropScience's research facility. Then, they will hear presentations on Texas cotton production and on Texas A&M U.'s Texas Cotton Improvement Program at the Plains Cotton Growers office before visiting PYCO Industries. They also will tour Vardeman Farms in nearby Slaton and the Caprock Winery in Lubbock.

The next day, the group will see Farmers Cooperative Compress and then get a presentation on electronic marketing at Plains Cotton Cooperative Assoc. before observing the Lubbock Feedlot and Back to Nature Resources operations. They also will tour Mimms' Farm in Acuff.

The next two days the group will be in the state's Coastal Bend area. On Aug. 20 in Corpus Christi, they will visit Stover Equipment Company, the Gulf Compress, the Port of Corpus Christi, Gatefront, LLC, and the USDA Agricultural Marketing Service's cotton classing facility. They also will see the Edcot Coop Gin in Odem, the Gregory Gin in Gregory and tour individual farms in the Coastal Bend area.

The tour concludes on Aug. 21 with a visit to Kingsville for an update on the South Texas Boll Weevil Program. The group also will see the Texas Parks and Wildlife Fish Hatchery in Corpus Christi.

Sales, Shipments Steady

Net export sales for the week ending on Aug. 7 were 185,100 bales (480-lb). This brings total '14-15 sales to approximately 4.8 million bales. Total sales at the same point in the '13-14 marketing year were approximately 3.5 million bales. Total new crop ('15-16) sales are 385,200 bales.

Shipments for the week were 102,200 bales, bringing total exports to date to 102,200 bales, compared with the 331,200 bales at the comparable point in the '13-14 marketing year.

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