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April 24, 2015
 

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Cotton's Week: March 1, 2024
 
 


 
Committees Advance Trade Legislation

Both the Senate Finance Committee and the House Ways and Means Committee held markups to advance Trade Promotion Authority (TPA) and extend other expiring trade legislation.

The Finance Committee approved TPA (S. 995) on a 20-6 vote with all Republicans voting in the bill's favor except Sen. Burr (R-NC) who noted his significant concerns with how previous trade agreements have harmed the US textile industry.

That committee also approved a separate trade package that included an extension of the African Growth and Opportunity Act (AGOA), the Generalized System of Preferences (GSP), preferential duty treatment for Haiti, Trade Adjustment Assistance (TAA) and customs reauthorization, including provisions to strengthen trade remedy laws. An amendment was adopted that attempts to deal with currency manipulation of trading partners by allowing trade remedy provisions to apply in such cases.

During Committee consideration, several amendments were introduced to extend certain expired or expiring tariff preference levels (TPLs) for textile/apparel products from countries already in a free trade agreement with the United States. The original TPLs, which were intended to be temporary in nature, provided an exception to allow those products to receive preferential access to the United States even if the products do not meet the rules of origin required in the trade agreement. The Bahrain TPL amendment was the only one voted on and it was defeated by a 10-16 vote.

The NCC, working closely with the National Council of Textile Organizations, communicated to Finance Committee members from Cotton Belt states and urged them to oppose any of the TPL amendments that were considered by the Committee.

The House Ways and Means Committee also advanced its TPA bill (H.R. 1890) by a vote of 25-13. That committee also approved a separate package of trade legislation similar to the Senate Finance Committee package, which included TAA, GSP, AGOA, preferential duty treatment for Haiti and customs reauthorization. No amendments on the TPL issue were offered at the markup. The package also includes provisions to help strengthen trade remedy laws and compliance of other countries when trade remedies are applied.

It is expected that TPA and the other package of trade bills will move to the House and Senate floor for a vote in May. TPA passage is needed to allow the Administration to complete the Trans Pacific Partnership negotiations later this year.

 
Comments Sought on Conservation Compliance Procedures

USDA issued an Interim Rule outlining the procedures for linking conservation compliance with crop insurance. Comments to the rule should be submitted by June 23.

The '14 farm law requires producers to file a Highly Erodible Land Conservation and Wetland Conservation Certification form (AD-1026) with their local USDA service center by June 1, '15, in order to become or remain eligible for crop insurance premium support.

Most farmers already have a certification form on file because it is required for participation in most USDA programs such as marketing assistance loans, farm storage facility loans and disaster assistance. However, it is important that all affiliated persons have an AD-1026 on file and for producers to use the same Tax Identification Number with both the Farm Service Agency (FSA) for their AD-1026 and their crop insurance company.

Producers should visit their local USDA service center and talk with their crop insurance agent before the June 1, '15, deadline to ask questions, get additional information or learn more about conservation compliance procedures, especially if they receive a letter from USDA regarding the AD-1026. Producers who file their form by the deadline will be eligible for federal crop insurance premium support during the '16 reinsurance year, which begins on July, 1, '15.

A conservation compliance fact sheet is at www.fsa.usda.gov/Internet/FSA_File/conserve_compli_insure.pdf. The Highly Erodible Land Conservation and Wetland Conservation Certification form is available at local USDA service centers or online at www.fsa.usda.gov/AD1026form. When a producer completes this form, FSA and Natural Resources Conservation Service staff will outline any additional actions that may be required for compliance with highly erodible land and wetland provisions.

 
Cuba Trade Hearing Held

The Senate Agriculture Committee held a hearing to discuss the opportunities and challenges that the United States would face if it were to further open the process of exporting agricultural products to Cuba. Committee Chairman Roberts' (R-KS) opening remarks highlighted the fact that in the past, agriculture has been used as a tool to help build relationships with other countries and he hopes Cuba will embrace its trade opportunities with the United States so both can gain from the increased trading relationship.

Panelists at the hearing included: federal agency personnel, agribusiness and association leaders, a university professor, a wheat farmer, and a cattle rancher.

Doug Kessling, a Kansas wheat grower who recently visited Cuba, pointed out its potential as a market for U.S. agricultural exports. In his testimony, he explained that there are many products, such as wheat, that are widely consumed in Cuba but are not grown there. 

Regarding challenges, Kessling explained that federal restrictions on trade with Cuba are putting US farmers at a competitive disadvantage. According to his testimony, current laws and regulations require American exporters to receive cash payment in advance before products can be offloaded at a Cuban port, whereas other countries such as Canada and France don't require cash transactions. These restrictions make trade with other countries much more appealing because Cuba can purchase products through a line of credit.

Panelists also explained that Cuba's close proximity makes it an easy country to trade with as products can make it there in a relatively short period of time. 

Chairman Roberts noted that while trade with Cuba has the potential to greatly benefit the United States, he also stressed that it will not be a quick process and the United States needs to take a realistic approach.

Earlier this year, Ranking Member Stabenow (D-MI) helped introduce the Freedom to Export Act (S. 491), a bipartisan bill that would modernize US policy towards Cuba and open more opportunity for US farmers to access the Cuban market. In addition, Sens. Boozman (R-AR) and Heitkamp (D-ND) introduced other bipartisan legislation, the Agriculture Export Expansion Act (S. 1049), which would change a provision in current law, lifting the ban on financing and creating greater market access for producers. This would allow banks to finance agricultural exports to Cuba, helping to open Cuban markets to American farmers and ranchers.

 
Comments Submitted on UAS Proposed Rule

The NCC and other agricultural organizations co-signed a letter that was sent to the Federal Aviation Administration (FAA) commenting on the Operation and Certification of Small Unmanned Aircraft Systems proposed rule.

The letter, on the NCC's website at www.cotton.org/issues/2015/upload/15UASlet.pdf, expresses the organizations' support for the use of unmanned aircraft systems (UAS) to help farmers and ranchers manage their crops and livestock and make more informed business decisions. It also explains how the agriculture community recently has been embracing new technologies and implementing new precision agriculture techniques to increase efficiency and sustainability, to which UAS technology can contribute.

Specifically, immediate uses for UAS technology are crop scouting, field mapping and livestock monitoring. The systems have the potential to exponentially decrease the time it takes to complete specific jobs while providing more timely feedback than many current methods. The technology also can be used for early detection of pest and weed infestations which would allow growers to identify threats before becoming too costly.

The letter also urged the FAA, as they move forward with the rulemaking, to seek input from the agriculture industry as it is one of the few industries that offers a low risk, high reward potential when using this technology.

 
Emerging Leaders Program Class Chosen

Twelve US cotton industry members have been selected to participate in the NCC's Emerging Leaders Program for '15-16.

Participants include: PRODUCERS -- Rafe Banks, Clarkedale, AR; Brandon Brooks, Phoenix, AZ; Matt Coley, Vienna, GA; Paul Minzenmayer, Rowena, TX; Sutton Page, Avoca, TX; and Brad Williams, Burlison, TN; GINNERS -- Phillip Kidd, Edmonson, TX; and Todd Waters, Pantego, NC; MERCHANTS -- Cory Barnes, Cordova, TN; and Ken Burton, Montgomery, AL; WAREHOUSER -- Joe Cain, Bakersfield, CA; and MARKETING COOPERATIVE -- Vicki Dorris, Lubbock, TX.

Now in its third year, the NCC's Emerging Leaders Program is supported by a grant to The Cotton Foundation from Monsanto.

NCC Chairman Sledge Taylor, a Como, Miss., producer and ginner, said, "The Council recognizes that sound leadership continuity is essential for U.S. cotton's health. We are grateful for Monsanto's ongoing support of this initiative that is helping to identify and equip industry members and encourage them to take on important leadership roles and duties."

The Emerging Leaders Program provides participants a better understanding of how the NCC carries out its mission of ensuring the US cotton industry's seven segments can compete effectively and profitably in the raw cotton, oilseed and US-manufactured product markets at home and abroad.

Specifically, participants get an in-depth look at: 1) the US cotton industry infrastructure and the issues affecting the industry's economic well-being; 2) the US political process; 3) the NCC's programs as well as its policy development and implementation process; and 4) Cotton Council International's activities aimed at developing and maintaining export markets for US cotton, manufactured cotton products and cottonseed products. The Program also provides participants with professional development and communications training such as presentation and business etiquette, instruction for engaging with the news media, and utilizing social media tools and tactics.

Class members will participate in three sessions. The first session, set for the week of June 21, '15, in Memphis and St. Louis, will provide an orientation to the NCC, professional development and communication skills training and an agribusiness briefing. Class members will see policy development at the NCC's '16 Annual Meeting in February during the second session while the third session in Washington, DC, will provide a focus on policy implementation and international market development.

 
Gin School Registration Encouraged

Gin managers and superintendents as well as other key gin employees are encouraged to register for one of the two remaining '15 Ginner Schools. The Western Ginners School is set for the Southwest Ginning Research Laboratory in Mesilla Park, NM, on May 5-7; and the Stoneville Ginners School will be held at the USDA Ginning Laboratory in Stoneville, MS, on June 9-11.

Registration and course descriptions are on the National Cotton Ginners Assoc. (NCGA) website at www.cotton.org/ncga/ginschool/index.cfm.

The schools' programming is coordinated by the NCGA, working in conjunction with Tommy Valco, USDA's cotton technology transfer coordinator, and the USDA ginning laboratories. The schools offer Levels I, II and III of course instruction as well as continuing education courses. This year's programming is featuring practical information on all aspects of ginning with overall emphasis on increasing ginning efficiency, turning out high quality fiber and improving safety.

The Ginner Schools' continuing education courses are covering new technology and current research efforts; developing an effective worker safety program and equipment upgrade strategy; controlling gin emissions and improving ginning capacities.

School cooperators include: USDA's Agricultural Research Service, NCGA and its member associations, the NCC, Cotton Incorporated, gin machinery/equipment manufacturers and suppliers, and select land grant universities.

The recently-completed '15 Southwest Ginners School in Lubbock was attended by 127.

 
COTTON USA Focuses on Uniform Industry

COTTON USA showcased US cotton yarn spinning, knitting, weaving, dyeing and finishing from 10 major US textile mills at the recent '15 North American Assoc. of Uniform Manufacturers and Distributors convention in Orlando, FL.

COTTON USA prominently displayed the capabilities of Latin American uniform garment manufacturers from Mexico, Honduras, Nicaragua and the Dominican Republic. These manufacturers, which use US cotton fiber, yarn and fabrics, engaged in business dialog with US uniform companies interested in the supply of garments produced in Latin America.

"The corporate imagewear/uniform industry is an important and growing segment of the U.S. apparel industry," Cotton Council International Interim Executive Director Vaughn Jordan said. "By showcasing U.S. manufactured yarns and fabrics along with Western Hemisphere garment manufacturers, cotton and U.S. cotton were able to have a presence in this important business segment."

The COTTON USA Sourcing Program seeks to develop business relationships throughout the cotton textile and apparel chain with the objective of increasing exports of US manufactured cotton products to the Western Hemisphere.

 
Sales Steady, Shipments Strong

Net export sales for the week ending on April 16 were 177,200 bales (480-lb). This brings total '14-15 sales to approximately 10.7 million bales. Total sales at the same point in the '13-14 marketing year were approximately 10.1 million bales. Total new crop ('15-16) sales are 1.1 million bales.

Shipments for the week were 340,700 bales, bringing total exports to date to 7.2 million bales, compared with the 8.0 million bales at the comparable point in the '13-14 marketing year.

 

 
Effective April 24-30, ’15

Adjusted World Price, SLM 11/16

 48.56 cents

*

Fine Count Adjustment ('14 Crop)

0.20 cents


Fine Count Adjustment ('15 Crop)

 0.15 cents


Coarse Count Adjustment

  0.00 cents


Marketing Loan Gain Value

 3.44 cents


Import Quotas Open

13

 
Special Import Quota (480-lb bales)

874,254


ELS Payment Rate

0.00 cents


*No Adjustment Made Under Step I

 
Five-Day Average

Current 5 Lowest 3135 CFR Far East

68.25 cents


Forward 5 Lowest 3135 CFR Far East

NA


Fine Count CFR Far East

 70.00 cents

 
Coarse Count CFR Far East

0.00 cents


Current US CFR Far East

72.55 cents


Forward US CFR Far East

NA