USDA will issue final 2008-crop counter-cyclical payments (CCPs) for upland cotton beginning October 14. The final CCP payment rate for upland cotton is 12.58 cents per pound - the statutory maximum level. Producers who received a partial payment will receive 7.55 cents per pound which is the final rate of 12.58 cents adjusted for the partial payment rate of 5.03 cents per pound.
The 2008 farm law requires 2008 final counter-cyclical payments to be paid as soon as practical following the end of the marketing year, but not sooner than Oct. 1, 2009.
The National Agricultural Statistics Service (NASS) announced the final market year average price for upland cotton on Oct. 9, 2009 of 47.8 cents per pound. The counter-cyclical payment rate is the amount by which the target price of each commodity, specified by the 2008 farm law, exceeds its effective price. The effective price equals the direct payment rate plus the higher of either the national average market price received by producers during the marketing year or the national average loan rate for the commodity.
USDA also announced it will not issue final 2008 counter-cyclical payments to farmers for peanuts, corn, grain sorghum, soybeans and oats because average prices for those commodities remain above levels that trigger these payments. An announcement on the final CCP for rice will not be made until Jan. 29, 2010 when NASS announces long-grain and medium and short-grain rice prices.