NCC Says House Panel’s Farm Bill Concept Solid First Step
The National Cotton Council said a farm bill concept paper offered by House Agriculture Committee Chairman Larry Combest (R-TX) and ranking member Charlie Stenholm (D-TX) is a good first step and focuses on the right issues for the next farm program.
"The House Committee has presented a bipartisan proposal on a new 10-year farm policy that enhances support for producers, improves export assistance programs, strengthens and enhances important conservation programs and is sensitive to budget concerns," NCC Chairman James Echols said. "This is a significant accomplishment. Chairman Combest and Rep. Stenholm have demonstrated strong leadership by presenting this concept for response. We applaud this bipartisan effort to complete a new farm bill in a timely fashion. In many respects, this concept paper follows a blueprint outlined by the Council in testimony before the House Agriculture Committee, including the establishment of a new counter cyclical program for cotton and other commodities.
"The Council appreciates the opportunity the Committee has given us to review all aspects of this proposal in the coming days. We look forward to sharing our response and recommendations next Wednesday before the Committee."
The committee’s proposal maintains planting flexibility and would continue decoupled payments under the Agriculture Market Transition Act at ’02 levels while providing a new fixed payment for soybeans of 34 cents per bushel.
The proposal includes a new counter-cyclical assistance program based on target prices set at 1995 levels (72.9 cents/lb. for cotton). While the $40,000 per person limitation for AMTA payments is retained, a separate payment limit of $75,000 for counter-cyclical payments for all crops would be established.
The nonrecourse marketing loan program would be continued with no change in loan rates except for a decrease in the soybean loan rate to $4.92 per bushel and an increase in the grain sorghum loan rate to $1.89 per bushel. Loan eligibility would continue for 100 percent of current production as would the $75,000 limitation for loan deficiency payments and marketing loan gains. Generic commodity certificates would continue to be authorized.
The proposal would give producers the option to update acreage bases based on more recent plantings or to continue to use their AMTA contract acres. Oilseed acres must be included in the acreage bases. Payment for both the fixed decoupled and counter-cyclical programs would be made on 85 percent of the base acres. Current AMTA payment yields would be used for both the fixed decoupled and counter-cyclical payments.
While the Committee’s proposal increases spending for commodity programs significantly, budget constraints caused total income support to fall below NCC’s recommended levels and precluded the removal of the 1.25 cent threshold on step 2 in this proposal.
Echols said he was encouraged by visits this week with some Congressional members regarding the U.S. textile industry crisis and that the Council would work to find ways to enhance the overall competitiveness of the textile sector. He said legislators expressed high awareness of that industry’s dire straits, including the negative impact of exchange rates.
"We received a favorable response to the proposals we discussed for assisting U.S. textiles, and learned there may be ways to address this concern outside farm bill deliberations," Echols said.
The National Cotton Council of America’s mission is to ensure the ability of all U.S. cotton industry segments to compete effectively and profitably in the raw cotton, oilseed and manufactured product markets at home and abroad.