Cotton's Week August 10, 2001

Cotton's Week August 10, 2001

Cotton's Week: August 10, 2001

USDA Report Hikes ’01 Cotton Production

In its August crop report, USDA estimated ’01-’02 US crop at 20 million (480-lb.) bales. Upland production was estimated at 19.41 million bales and ELS production at 593,000 bales. Harvested area was estimated at 14.34 million acres, implying non-harvested area of 1.95 million acres based on USDA’s June acreage report. Resulting abandonment rate is roughly 12% for ’01-’02 crop. National average yield per harvested acre was estimated to be 670 pounds, about 21 pounds above 5-year average.

On regional basis, Southeast crop is estimated at 5.26 million bales, based on harvested acres of 3.67 million and regional average yield of 687 pounds, 63 pounds above 5-year regional average. Expected yields in all states of region are moderately to significantly above average. Greatest yield gains are expected to occur in Alabama and Florida, where this year’s yields are forecast to be at least 100 pounds above 5-year average for each state.

In Mid-South expected production is 6.94 million bales. Harvested area is estimated to be 4.73 million acres and expected yield is 704 pounds per harvested acre. Expected yields are moderately below average in all states with exception of Louisiana and Tennessee.

Southwest upland crop is estimated at 4.62 million bales. Expected harvested area is 4.74 million acres and regional average yield is 468 pounds. Expected yields in Oklahoma are moderately above 5-year average of 443 pounds. However, expected yields in Kansas and Texas are below their 5-year average of 360 pounds and 479 pounds, respectively.

Upland production in West is estimated at 2.59 million bales with harvested area of 963,000 acres and regional average yield of 1,291 pounds. Reflecting good growing conditions, expected yield in California is 1,366 pounds per harvested acre, 184 pounds above 5-year average. Moderate increases above respective 5-year averages are estimated for Arizona and New Mexico.

ELS crop is estimated 593,000 bales. Harvested area is pegged at 234,000 acres with average yield of 1,216 pounds.

U.S. Cotton Crop, ’01-’02

YIELD PER

5-YEAR

480-

HARV.

HARV.

AVG.

POUND

ACRES

ACRE

YIELD

BALES

Thou.

Lb.

Lb.

Thou.

UPLAND

SOUTHEAST

3,674

687

624

5,259

Alabama

605

682

582

860

Florida

124

650

541

168

Georgia

1,490

680

629

2,110

North Carolina

1,055

701

645

1,540

South Carolina

296

681

617

420

Virginia

104

743

707

161

MID-SOUTH

4,730

704

701

6,940

Arkansas

1,150

714

744

1,710

Louisiana

900

693

674

1,300

Mississippi

1,680

743

753

2,600

Missouri

395

632

637

520

Tennessee

605

643

592

810

SOUTHWEST

4,737

468

478

4,621

Kansas

37

272

360

21

Oklahoma

200

480

443

200

Texas

4,500

469

479

4,400

WEST

963

1,291

1,171

2,590

Arizona

278

1,260

1,253

730

California

615

1,366

1,182

1,750

New Mexico

70

754

685

110

TOTAL UPLAND

14,104

661

642

19,410

ELS

234

1,216

1,037

593

Arizona

6

960

855

12

California

204

1,271

1,114

540

New Mexico

7

686

664

10

Texas

17

875

787

31

ALL COTTON

14,338

670

649

20,003

Source: USDA-NASS August Crop Production Report.

Korea’s GSM-102 Allocation Upped

USDA responded to Cotton Council International (CCI) request to increase Korea's GSM-102 allocation for cotton. USDA increased credit guarantees available for sales of US agricultural commodities to South Korea by $60 million under Commodity Credit Corporation’s GSM-102 program for FY01. USDA's amendment increases total program allocation from $590 million to $650 million. Cotton's share of '01 program was increased from $100 million to $135 million. In letter to Acting General Sales Manager Mary Chambliss, CCI, along with 3 other commodity organizations, thanked USDA for increase and requested timely FY02 allocations on commodity-specific basis.

Senate Confirms OSHA Head

Senate confirmed nomination of John Henshaw as new Assistant Secretary of Labor for Occupational Safety and Health (OSHA) by unanimous consent. Henshaw, former corporate safety and health director at St. Louis-based Astaris, Solutia (both formally part of Monsanto Company) and for Monsanto Company, began work at OSHA Aug. 6.

Henshaw, who was strongly supported by Sen. Bond (R-MO), has 26 years experience in safety and health and is former president of American Industrial Hygiene Association. At confirmation hearing he said he supports balanced OSHA that provides enforcement where needed but also supports significant focus on compliance assistance and education. Henshaw avoided making any commitment on ergonomics, saying he needs time to review information and come at topic with fresh set of eyes.

CPSC Chairman to Resign

Consumer Products Safety Commission (CPSC) Chairman Ann Brown, who was appointed by former President Clinton and who served as Chairman since ’94, announced her intention to resign as Chairman and as Commissioner on Nov. 1, ’01, unless another Chairman is nominated and confirmed by Senate before that date, reigniting battle over who should replace her.

In bitterly partisan confrontation last week (Cotton’s Week 8-3), Senate committee rejected nomination of Mary Sheila Gall, President Bush’s choice to replace Brown. Majority Leader Daschle (D-SD) said he would not bring Gall’s nomination to floor, but Brown’s resignation may help Republican efforts to force floor vote on Gall. After her departure, Brown will create nonprofit foundation called "Safer America for Everyone," essentially shadow CPSC. Until then, Brown said she hoped to accomplish several goals, among them "setting standards for mattresses to make them less flammable."

Vegetable Oil MACT Rule Changed

Vegetable Oil MACT (maximum achievable control technology) coalition, which includes NCC and NCPA, worked with EPA to add clarifying language to Vegetable Oil MACT rule provisions. Specifically-tailored "startup, shutdown and malfunction (SSM)" provisions were written into rule to address rule’s unique circumstances, so that SSM general provisions would not apply to Vegetable Oil MACT rule. General Provisions rulemaking preamble now provides regulated community with guidance it needs on SSM issue, and amended Vegetable Oil MACT rule has some elements of proposed General Provisions amendments written in. These changes could be made as technical corrections to Vegetable Oil MACT rule at same time General Provisions amendments are promulgated. This would streamline SSM reporting requirements and eliminate confusion as to when reports are required.

Coalition response follows EPA’s April promulgation of national emission standard for hazardous air pollutants for solvent extraction for vegetable oil production. This final rule requires all existing and new solvent extraction facilities using n-hexane and that are major sources (cottonseed oil mills) to meet emission standards reflecting application of MACT. Earlier, EPA had proposed extensive changes to "General Provisions" for MACT standards. Final Vegetable Oil MACT Rule for solvent extraction facilities extensively cross-references current version.

’01-’02 Cotton Leadership Class Chosen

’01-’02 cotton leadership class has been selected by NCC’s Cotton Leadership Development Committee.

Members include: ProducersDooie Leach, Raeford, NC; Jay Minter, Tyler, AL; Karen Ollerton, Casa Grande, AZ; and Roger Schuh, Madera, CA; GinnerKent Fountain, Surrency, GA; WarehousemanTommy Clodfelter, Ralls, TX; MerchantBuck Dunavant, Memphis, TN; CrusherBilly Breedlove, Greenwood, MS; CooperativeStan McMikle, Albany, GA; and ManufacturerEvans Tindal, Cheraw, SC.

During their first session Sept. 9-14 in Mid-South, group will get orientation to NCC/industry issues, attend NCC’s fall Board of Directors meeting; observe cotton production and merchandising operations; tour USDA cotton classing office, participate in communications training and visit Dupont Agricultural Products’ office.

During 5 other weeks of activity across the Cotton Belt, class members will visit with industry leaders and observe innovative cotton production, processing and cutting-edge research. They also will meet with lawmakers and government agency representatives during visit to Washington, DC.

Program, which seeks to identify potential industry leaders and provide them developmental training, has been supported since its ‘83 inception by grants from DuPont to Cotton Foundation.

Texans Share Innovations With Far West Peers

Texas cotton producers hosted New Mexico, Arizona and California cotton producers in third of 4 tours of NCC/FMC ’01 Producer Information Exchange (PIE) program.

"The P.I.E. program is basically the Internet in the flesh," said James F. "Jimmy" Dodson, Foundation president and Robstown, TX, producer. "It’s a problem-solving tool that allows innovative producers to share information, management ideas and concerns with other progressive cotton producers."

Far West producers saw farming operations in Texas’ Coastal Bend and High Plains regions. They also toured port of Corpus Christi and visited New Home Coop Gin, Plains Cotton Growers, Plains Cotton Oil Mill and Plains Cotton Cooperative Association in Lubbock.

The ’01 PIE program’s final tour has producers from Arkansas, Louisiana, Missouri, Mississippi and Tennessee traveling to Georgia and Alabama Aug. 18-23.

Now in its 13th year, PIE is managed by NCC’s Member Services staff and supported by FMC grant to Cotton Foundation

Strong Start for Exports in ’01-’02

For week ending Aug. 2, net sales for ’01-’02 marketing year were approximately 187,200 bales (480-lb.) with major purchases by South Korea (64,155), Thailand (28,140), Indonesia (21,945), and India (17,430). Outstanding sales of roughly 1.66 million bales on July 31 were carried forward to ’01-’02 marketing year. Final shipments of 59,500 bales brought accumulated exports for ’00-’01 to slightly more than 6.7 million. Outstanding commitments are now approximately 4.97 million bales for ’01-’02 marketing year.

Effective Aug. 10 – Aug. 16, ’01

Adj. World Price, SLM 1 1/16.........30.22 cents*
Coarse Count Adjustment ..............0.00 cents
Current Step 2 Certificate Value......8.00 cents
Marketing Loan Gain Value............21.70 cents
*No Adjustment Made Under Step I

Five-Day Average

Current 3135 c.i.f. N. Eur...........44.15 cents
Forward 3135 c.i.f. N. Eur...........No Quote
Coarse Count c.i.f. N. Eur...........43.33 cents
Current US c.i.f. N. Eur.............53.40 cents
Forward US c.i.f. N. Eur.............No Quote