Cotton's Week: November 21, 2003

Cotton's Week: November 21, 2003

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NCC Applauds Much-Needed China Textile Safeguard Decision

The Commerce Department’s approval of the textile/fiber coalition’s China safeguard petitions on knit fabric, brassieres and dressing gowns acknowledges damage to the US cotton industry by surges in Chinese imports, the NCC said in a statement.

The Commerce Department announced that the Committee for the Implementation of Textile Agreements (CITA) approved the petitions in accordance with the procedures established under the China World Trade Organization (WTO) accession agreement. The approval triggers a consultation process with the Chinese to limit the growth of imports to the US in these categories. If no agreement on limiting imports is reached, the US may limit the level of shipments from China to a level no lower than 7.5% above the amount entered during the first 12 months of the most recent 14 months preceding the request for consultations.

The NCC joined with other fiber and textile organizations to encourage implementation of the China safeguards because cotton products on which quotas have been removed are among the fastest growing import categories.

“The action sends an important message from the Administration that trade agreements will be enforced,” NCC Chairman Bobby Greene said in expressing the US cotton industry’s appreciation for the decision to Commerce Department Under Secretary for International Trade Administration Aldonas during a meeting with him in Miami.

“This safeguard action is intended to get China to fully comply with its WTO obligations. China has flooded the US market with cotton textiles and been unwilling to implement regulations that provide consistent, predictable and transparent market access for US agricultural products, including cotton.”

NCC Vice President Stephen Felker, CEO of Avondale Mills in Georgia, commended CITA for this decision - one he says will greatly assist the US textile sector. “Jobs are at risk because the level of Chinese imports is excessive, disruptive and clearly in violation of the levels permitted in China’s WTO agreement,” Felker said. He said the task is not over as textile workers will face substantial risk in January ’05 when all textile quotas are lifted. “This action, though, will set the stage for similar action then by the US if necessary.”

In October, 139 Representatives and 26 Senators signed letters - and a number of Senators and Representatives sent separate letters - urging the Administration to invoke the special textile China safeguard provision included in China’s WTO accession agreement. “These petitions would never have been approved without the help of our friends on Capitol Hill,” NCC Consultant Gaylon Booker said. “The coalition would especially like to thank Reps. Coble (R-NC), Spratt (D-SC), Goode (R-VA) and Pascrell (D-NJ), Sens. Graham (R-SC) and Hollings (D-SC) and all members of Congress who sent letters.”



FTAA Framework OK'd in Miami

Free Trade Area of the Americas (FTAA) negotiations concluded in Miami on Nov. 20 when trade ministers signed off on a framework that is significantly less comprehensive than originally envisioned.

The framework, which was reportedly necessary to allow negotiations to continue at all, allows countries to take on different levels of commitments and allows subgroups of countries to negotiate in areas where they want to discuss additional benefits and obligations.

Prior to the Miami session, earlier declarations had defined the FTAA as a single undertaking with one set of rules for all parties. The Miami declaration still calls for negotiations in 9 categories: market access; agriculture; government procurement; investment; competition policy; intellectual property; services; dispute settlement; and subsidies, anti-dumping and countervailing duties.

The ministers also reaffirmed Jan. 1, ’05, as a target date for completion of the negotiations.

During the Miami meetings, US Trade Representative Zoellick announced that the US would formally initiate negotiations with Colombia, Peru, Ecuador, Bolivia and Panama that would lead to free trade agreements.



Bale Contamination Warning Issued

The Technical Services Department of the NCC recently was informed about potential contamination in baled lint that resulted from the use of polypropylene twines in or around cotton gins. A representative of a domestic mill complained about receiving bales with the heads closed with this type of twine. Foreign mills also have lodged complaints about US gins using similar twines.

If these types of polypropylene or other plastic fibers find their way into the cotton lint and are spun into yarn, the fabrics made from those yarns will not dye or bleach properly. Defects occur in finished goods that are routinely rejected at great cost to yarn spinners.

Cotton growers and ginners are urged to refrain from using these and similar plastic twines around modules or cotton bales. Growers also are reminded that plastic in any form can cause serious problems for textile mills. Therefore, fields should be inspected prior to harvest in order to eliminate foreign objects that may find their way into growers’ seed cotton.

The NCC urges the use of non-contaminating materials such as cotton cords or cotton twines to secure module tarps, close bale heads and attach permanent bale identification tags.



Hazardous Materials Transport Rules Announced

Agricultural producers who transport certain hazardous materials in quantities that require placards must now develop and implement a transportation security plan. This new Department of Transportation rule affects transportation of hazardous materials needed to support commercial activities such as farming.

The rule’s intent is to deter terrorist and other illegal acts while limiting a producer’s exposure to liability in the event that an illegal act occurs. Producers who do not ship or transport hazardous materials in amounts that require placards do not need a security plan. Suppliers who deliver hazardous materials to a farming operation must develop a plan.

If a security plan is required, it must include measures to address personnel, unauthorized access and en routetransportation issues. A summary of the measures, types and quantities of hazardous materials that require a placard and a sample security plan for agricultural operations is available at http://hazmat.dot.gov/hmt_security.htm. To access PDF files for the summary information, select “Hazmat Transportation Security Requirements - Applicability to Farmers, Ranchers and Production Agricultural Operations” and “Transportation Security Evaluation and Planning for Farmers, Ranchers and Production Agricultural Operations.”



CCC Seeks Consolidation of Warehouse Rules

USDA issued a proposed rule on Nov. 20 to consolidate regulations for all commodities stored by the Commodity Credit Corp. into one set of regulations and revise several provisions related to storage agreements.

The proposed rule includes the following provisions: firefighting equipment requirements specify that warehouses must meet local standards; participating warehouses will be required to submit an accountant’s audit or review report; and net worth requirement deficiencies must be met with bonds, cash, negotiable securities, irrevocable letters of credit or alternative instruments, but a legal liability insurance policy will no longer be acceptable.

Comments are due by Jan. 20 and should be submitted to Froehlich@wdc.fsa.usda.gov.



Vietnam Hosts US Cotton, Textile Delegation

A team of US cotton apparel retailers, manufacturers, a cotton producer and staff specialists toured Vietnam on Nov. 10-14 to explore the country’s textile and garment industry and investigate prospects for sourcing and selling cotton and cotton products.

The team, sponsored by the Importer Support Group of the Cotton Board and arranged by Cotton Council International (CCI) and Cotton Incorporated, toured local factories in Hanoi and Ho Chi Minh City and met with government and industry officials, including US Embassy Hanoi staff and representatives of the Vietnam National Textile and Garment Corp. (VINATEX) and the Vietnam Textile and Apparel Assn. (VITAS). In addition, the group collaborated with VITAS to sponsor a product exhibition and fashion show featuring locally-made 100% cotton products.

Team members included Dan DeYoe of Kids ‘R’ Us; William Donelan of Harvé Benard; Debi Gregg of Anchor Blue; Nancy Marino of Leo North Consulting; David Sasso of Buhler Quality Yarns Corp.; Anderson Warlick of Parkdale Mills; Alabama cotton producer Larkin Martin; Elizabeth King of the Cotton Board; Jim White of Cotton Incorporated; and Allen Terhaar and Laura Nelson of CCI.



Export Sales for Week Ending Nov. 13

Net export sales for the week ending Nov. 13 were 560,200 bales (480-lb.), resulting in total ’03-04 sales of almost 7.8 million bales. Total sales at the same point in the ’02-03 marketing year were over 5.7 million bales. Total new crop (’04-05) sales are 280,900 bales (480-lb.).

Shipments for the week were 163,000 bales, bringing total exports to date to 2.3 million bales, ahead of the 2 million bales at the comparable point in the ’02-03 marketing year.



Cotton's Week Publication Notice

Because of the Thanksgiving holiday, Cotton's Week will not be published Friday, Nov. 28.

HAPPY THANKSGIVING !!



Prices Effective November 21-27, 2003

Adjusted World Price, SLM 1 1/16

64.51 cents

*

Coarse Count Adjustment

0.00 cents

Current Step 2 Certificate Value

1.04 cents

Marketing Loan Gain Value

0.00 cents

Import Quotas Open

 1

Step 3 Quotas (480-lb. bales)

 128,590

ELS Payment Rate

26.40 cents

*No Adjustment Made Under Step I
 
Five-Day Average
 
Current 3135 c.i.f. Northern Europe

77.91 cents

Forward 3135 c.i.f. Northern Europe

No Quote

Coarse Count c.i.f. Northern Europe

75.43 cents

Current US c.i.f. Northern Europe

78.95 cents

Forward US c.i.f. Northern Europe

No Quote

 
Weighted Marketing-Year Average Farm Price  
 
Year-to-Date (August-September)

52.38 cents

**

**August-July average price used in determination of counter-cyclical payment

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