NCC Disappointed With Senate Action on Payment Limits Amendment

NCC Chairman James Echols, a Memphis, TN, cotton merchant, said today that the cotton industry was very disappointed with the Senate’s Thursday vote concerning payment limitations.

February 8, 2002
Contact: Marjory Walker
(901) 274-9030

MEMPHIS – NCC Chairman James Echols, a Memphis, TN, cotton merchant, said today that the cotton industry was very disappointed with the Senate’s Thursday vote concerning payment limitations.

"The vote shows a serious lack of understanding about commercial agriculture," Echols said. "This amendment dramatically changes the impact the Agriculture Committee bill will have on America’s farmers and ranchers. The National Cotton Council will have to evaluate its options concerning the bill."

Chairman Echols praised the efforts of Senator Lincoln (D-AR) who argued forcefully that the Grassley/Dorgan amendment would cripple agriculture.

"Our initial estimates reflect what Senator Lincoln feared," Echols stated. "It appears that the average American cotton producer would be worse off under the Senate bill with this amendment than under current law. It seems clear that many Senators did not understand how this amendment destroys the nonrecourse loan – a farm program mainstay for more than 30 years. The Grassley/Dorgan amendment effectively removes this last, viable safety net for America’s farmers."

Echols also commended Senators Miller (D-GA), Cochran (R-MS), Landrieu (D-LA) and Hutchinson (R-AR) for their strong statements in support of commercial agriculture.

A NCC analysis indicates that the Grassley amendment puts such severe limitations on marketing loan gains and fixed and counter-cyclical payments that production financing will be out of the question for most farmers across the southern tier of the United States. With current commodity prices, many farms cannot cash flow, even with current restrictions on payments.

Echols said, "It is unfortunate that the Senate has used payment limits to essentially gut an otherwise good farm bill. The result is a unilateral disarmament of our farmers just ahead of resumption of another round of World Trade Organization (WTO) talks. If these provisions survive in a final farm bill, our negotiators will have little hope of convincing the rest of the world to reduce farm subsidies. It has been our contention that farm subsidy reductions should be done under the auspices of the WTO and in a way that is fair and equitable for American agriculture – not at their expense."