In its September crop report, USDA estimated a '14-15 US crop of 16.54 million bales -- 960,000 bales less than its August report. Upland production was estimated at 15.96 million bales and extra-long staple (ELS) production at 578,000 bales. In the report, USDA also reduced estimated plantings to 11.01 million acres of all cotton, down 360,000 acres from the June estimate. Harvested area was an estimated 9.88 million acres, implying a non-harvested area of roughly 1.13 million acres based on the revised planted acreage number. The resulting abandonment rate is 10.25%. The national yield per harvested acre was estimated to be roughly 803 pounds, 16 pounds less than the five-year average.
On a regional basis, the Southeast crop is estimated at 5.03 million bales, based on harvested acres of 2.65 million and a regional average yield of 911 pounds, 64 pounds more than the region's five-year average. All the region's states are expected to see yield increases when compared to their five-year averages. The largest is expected in Virginiawith yields estimated at 1,060 pounds per harvested acre, 180 pounds more than its five-year average. North Carolinaalso will see a yield increase with an estimated 950 pounds per harvested acre, 126 pounds more than its five-year average. Georgia's production leads the region with an estimated 2.60 million bales.
In the Mid-South, expected production is 3.20 million bales. Harvested area is estimated to be 1.42 million acres and the expected average yield is 1,082 pounds per harvested acre. All the region's states are expected to see yield increases when compared to respective five-year averages, with the largest gains seen in Louisiana (+261 pounds). Mississippi's production leads the region with an estimated 980,000 bales.
The Southwest upland crop is estimated at 6.97 million bales. Expected harvested area is 5.39 million acres and the regional average yield is 621 pounds, 27 pounds less than their five-year average of 648 pounds per harvested acre. The Texasupland crop is estimated at 6.60 million bales. Expected harvested area is 5.15 million acres and the average yield is 615 pounds, 32 pounds less than its five-year average. With respective yields of 731 pounds and 794 pounds, Oklahoma and Kansas are both up when compared to their respective five-year averages.
Upland production in the West is an estimated 762,000 bales with an estimated harvested area of 233,000 acres and a regional average yield of 1,570 pounds, 86 pounds more than the region's five-year average. The greatest yield gains are expected for California, (+154 pounds) to an estimated 1,749 pounds per harvested acre.
The ELS crop is an estimated 578,000 bales. Harvested area is pegged at 189,000 acres with an average yield of 1,465 pounds per harvested acre.
Source: USDA-NASS September Crop Production Report. 1/ Revised from June Acreage Report.
USDA Lowers US Export Projection
In its September report, USDA left '14-15 US mill use unchanged from its August report at 3.80 million bales. Exports were down 700,000 bales from the August report to 10.00 million bales, due to lower domestic supplies and reduced foreign import demand. This generates a total '14-15 offtake of 13.80 million bales. Ending stocks for '14-15 are projected at 5.20 million bales for an ending stocks-to-use ratio of 37.7%.
For the '13-14 crop year, USDA maintained US cotton production at 12.91 million bales. Estimated mill use was lowered 50,000 bales to 3.55 million bales. Exports were unchanged from the August report at 10.53 million bales. Total offtake for the '13-14 crop year is estimated at 14.08 million bales. Ending stocks for '13-14 are 2.45 million bales. The estimated stocks-to-use ratio for the '13-14 marketing year is 17.4%.
In the report, '14-15 world production is projected at 118.01 million bales, 370,000 bales more than last month. Mill use is projected at 112.12 million bales, 480,000 bales less than the August report. With beginning stocks at 100.30 million bales, this would result in world ending stocks of 106.29 million bales on July 31, '15, and a stocks-to-use ratio of 94.8%.
World production for the '13-14 marketing year was estimated to be 118.70 million bales, 430,000 bales more than last month's estimate. World mill use was lowered 430,000 bales to 107.99 million bales. Consequently, world ending stocks are estimated to be 100.30 million bales with a stocks-to-use ratio of 92.9%.
NCC Urges APH Adjustment Implementation
In a letter to Risk Management Agency (RMA) Administrator Brandon Willis, the NCC urged the agency to make every effort to implement for the '15 cotton crop the farm bill provision allowing a producer to adjust actual production history (APH) insurance yield. The letter, on the NCC website at www.cotton.org/issues/2014/aphadj.cfm, is based on an American Cotton Producers resolution that subsequently was approved by the NCC's Board.
The new provision will offer producers the opportunity to exclude from their APH calculation the years in which the county average yield falls below 50% of the previous 10-year average county yield. The provision also offers producers in contiguous counties similar opportunities to exclude the years in question. Adjustments to the APH yield are especially meaningful for portions of the Cotton Belt that recently have incurred several years of historic drought conditions.
The NCC also used the letter as an opportunity to commend RMA for their work in implementing for '15 the new Stacked Income Protection Plan, the Supplemental Coverage Option, new coverage options for enterprise units and differential coverage levels by practice.
House Approves Waters Bill
By a bipartisan vote of 262-152, the House passed legislation to prohibit the EPA from finalizing its Waters of the US rule. The Waters of the U.S. Regulatory Overreach Protection Act of 2014 (H.R. 5078) received favorable votes from 35 Democrats, including House Agriculture Committee ranking member Peterson (D-MN).
H.R. 5078 would prohibit the agencies from moving forward on a controversial rule which is opposed by most agricultural organizations that believe the rule would greatly increase the scope of the Clean Water Act. Instead, the bill would require the agencies to consult with state and local officials to develop a consensus approach to defining what bodies of water should fall under federal jurisdiction.
The White House already had threatened to veto the bill and said that the legislation would derail current efforts to clarify the Clean Water Act's scope, hamstring future regulatory efforts and create significant ambiguity regarding existing regulations and guidance. The White House also questioned the need for a two-year consultation with states and indicated that would delay rulemaking.
OSHA Issues Injury Reporting Final Rule
The Occupational Safety and Health Administration (OSHA) announced a final rule requiring employers to notify OSHA of work-related fatalities and injuries when an employee is killed on the job or suffers a work-related hospitalization, amputation or loss of an eye. The rule, which also updates the list of employers partially exempt from OSHA record-keeping requirements, will go into effect on Jan. 1, '15, for workplaces under federal OSHA jurisdiction.
Under the revised rule, employers will be required to notify OSHA of work-related fatalities within eight hours and work-related in-patient hospitalizations, amputations or eye losses within 24 hours. Previously, OSHA's regulations required an employer to report only work-related fatalities and in-patient hospitalizations of three or more employees. Reporting single hospitalizations, amputations or loss of an eye was not required under the previous rule.
All employers covered by the Occupational Safety and Health Act, even those who are exempt from maintaining injury and illness records, are required to comply with OSHA's new severe injury and illness reporting requirements. To assist employers in fulfilling these requirements, OSHA is developing a web portal for employers to report incidents electronically, in addition to the phone reporting options.
The full House Committee on Natural Resources held a legislative hearing to consider six bills that would reform implementation of the Endangered Species Act (ESA).
In his opening statement, Chairman Hastings (R-WA) said, "Over the past three years, the Committee has held numerous oversight hearings about the Administration's lack of ESA data transparency, inadequate deference to states, local county governments and private property owners relating to ESA decisions, and costly serial litigation and close-door settlements with certain groups that are forcing hundreds of new listings and millions of acres of habitat designations."
Collectively, the bills would establish a procedure for approval of certain settlements between the agencies and litigants; provide congressional direction for implementation of the ESA as it relates to operation of the Central Valley Project and the California State Water Project and for water relief in the State of California; include the number of the species on state and private lands as determined by the state in determining whether the species is an endangered or threatened species; allow states to propose and implement state protective action before species are listed; require the availability for public comment a draft economic analysis at the time a proposed rule to designate critical habitat is published; and reverse the listing of the lesser prairie chicken as a threatened species.
Witnesses at the hearing included Texas Dept. of Agriculture Commissioner Todd Staples; Arkansas Farm Bureau President Randy Veach; Tom Ray, Texas Water Conservation Assoc.; Secretary Robin Jennison, Kansas Dept. of Wildlife Parks & Tourism; and, Thomas Birmingham, Westlands Water District, Fresno, CA.
Sales Slip, Shipments Steady
Net export sales for the week ending on Sept. 4 were -32,800 bales (480-lb). This brings total '14-15 sales to approximately 5.2 million bales. Total sales at the same point in the '13-14 marketing year were approximately 4.0 million bales. Total new crop ('15-16) sales are 412,000 bales. The negative weekly sales total for '14-15 sales is the result of more than 100,000 bales of cancellations from China more than offsetting new sales to other countries.
Shipments for the week were 87,700 bales, bringing total exports to date to 514,600 bales, compared with the 1.1 million bales at the comparable point in the '13-14 marketing year.
Effective Sept. 12-18, ’14
Adjusted World Price, SLM 11/16
53.61 cents
*
Fine Count Adjustment ('13 Crop)
0.30 cents
Fine Count Adjustment ('14 Crop)
0.20 cents
Coarse Count Adjustment
0.00 cents
Marketing Loan Gain Value
0.00 cents
Import Quotas Open
13
Special Import Quota (480-lb bales)
882,048
ELS Payment Rate
0.00 cents
*No Adjustment Made Under Step I
Five-Day Average
Current 5 Lowest 3135 CFR Far East
73.30 cents
Forward 5 Lowest 3135 CFR Far East
NA
Coarse Count CFR Far East
NA
Current US CFR Far East
75.50 cents
Forward US CFR Far East
NA
'13-14 Weighted Marketing-Year Average Farm Price
Year-to-Date (Aug.-July)
77.15 cents
**
**Aug.-July average price used in determination of counter-cyclical payment
