Both the House and Senate budget committees adopted their respective FY16 budget resolutions. The House resolution projects to balance the federal budget in less than ten years by proposing to reduce federal spending by $5.5 trillion and by creating a fairer, simpler tax code.
Specific to agriculture, the House resolution calls for the House Agriculture Committee to provide a total of $1 billion in savings over ten years through the budget reconciliation process. That Committee has full flexibility in determining where the savings would be generated within programs under its jurisdiction. The House budget resolution was adopted by the Budget Committee on a party line vote of 22-13.
The Senate resolution proposes $5.1 trillion in reduced spending over ten years. Unlike the House, the Senate resolution does not include any budget reconciliation reductions for agriculture. The Senate budget resolution was adopted by its budget committee on a party line vote of 12-10.
The full House and Senate are scheduled to consider their respective budget resolutions during the week of March 23, with a number of amendments expected. Once both chambers pass their resolutions, work will begin to reconcile the differences in the two resolutions to provide a unified view of budget priorities for the House and Senate. The final budget resolution will determine whether there are required budget reductions for agriculture through the reconciliation process.
The budget resolution is used to set tax and spending priorities for the year ahead. Appropriations bills that will be considered later in the year actually provide the funding for programs. The reconciliation instructions included in a budget resolution can require actual budget reductions in programs within a specific committee's jurisdiction.
"Waters of the US" Proposed Rule Overly Burdensome
NCC Chairman Sledge Taylor told the House Agriculture Committee's Conservation and Forestry Subcommittee that a rule proposed by the EPA and Corps of Engineers to define "waters of the United States" under the Clean Water Act would require costly federal permits for many commonplace and essential farming practices.
The Subcommittee hearing in Washington, DC, was to review that proposed rule and its impact on rural America.
Emphasizing that this rule will have a significant impact on rural America and production agriculture, Taylor stated, "This will result in farmers like myself being forced to endure even more costly regulations and place many of us at risk for fines from the Agencies or facing a citizen suit for normal farming practices."
Taylor, one of nine witnesses, told the panel any revised rule needs to be released again for public comment. That's because as currently presented, it creates confusion and risk by providing the EPA and the Corps of Engineers with almost unlimited authority to regulate, at their discretion, any low spot where rainwater collects, including common farm ditches, non-permanent drainages and agricultural ponds in and near farms across the nation.
The proposed rule defines terms like "tributary" and "adjacent" in ways that Taylor said make it impossible for a farmer to know whether the specific ditches or low areas at their farm will be deemed "waters of the U.S."
"These definitions are broad enough to give regulators and citizen plaintiffs plenty of room to assert that such areas are subject to Clean Water Act jurisdiction," he said. "The tens of thousands of dollars of additional costs for federal permitting of ordinary farming activities is beyond the means of most farmers and ranchers—the vast majority of whom are family-owned small businesses."
Taylor said the Agencies' promise to make significant changes to the rule is a positive step, but given the amount of public interest in this rule, the Agencies are strongly encouraged to release the revised rule again for public comment.
"The Clean Water Act involves an extremely complex set of rules and regulations, and it is important for rural America to have ample input into any final rule," he stated.
House Panel Passes NPDES Bill
The House Agriculture Committee approved the Reducing Regulatory Burdens Act of 2015 (H.R. 897). This legislation (H.R. 872 in the 112th Congress and H.R. 935 in the 113th) would clarify Congressional intent regarding pesticide regulation in or near waters of the United States.
A '09 decision in the US Court of Appeals for the Sixth Circuit erroneously applied the provisions of the National Pollution Discharge Elimination System permitting process under the Clean Water Act (CWA) to pesticide applications that already were fully regulated under the Federal Insecticide, Fungicide and Rodenticide Act. As a result, many farmers are subject to costly and duplicative burdens providing no quantifiable public health or environmental benefit.
The expansion of jurisdictional waters under the Administration's "waters of the United States" proposed rule would likely result in a significant increase in the regulatory cost and burden associated with this court decision on food production costs and mosquito control programs. The House Agriculture Committee and the full House passed this bill during the two previous Congresses, but the Senate failed to act.
The NCC joinednearly 100 organizations on a letter to House Agriculture Committee members urging support for H.R. 897. The letter is on the NCC's website at www.cotton.org/issues/2015/upload/15npdeslet.PDF. The NCC's support for this legislation also was conveyed to the Committee's Cotton Belt Members.
Coalition Conveys E-Verify Concerns
The NCC joined a broad cross section of agriculture on a letter to the House leadership to express and explain the coalition's strong opposition to the Legal Workforce Act (H.R. 1147).
Earlier this month, the House Judiciary Committee approved the bill by a vote of 20-13. If enacted, the bill would mandate that all employers use E-Verify – a system designed to check the status of workers to ensure they can legally work in the United States.
The letter noted that mandatory E-Verify would have a devastating impact on US agriculture in the absence of a legislative solution for agriculture's labor needs and if the House decides to move forward on mandatory E-Verify without also moving a solution for agriculture, such action would cause irreparable harm to farmers across America.
The coalition letter, on the NCC's website at www.cotton.org/issues/2015/upload/15everifylet.PDF, conveyed clear and unequivocal opposition to H.R. 1147 as the bill does not address the agricultural workforce crisis. The letter called on Congress to 1) pass a solution for agriculture that addresses both the current agricultural workforce and 2) create a new guest worker program to meet future needs before any mandatory E-Verify program implementation.
NCC Comments on Stricter Ozone Standards
The NCC submitted comments on EPA's proposed plan to reduce the National Ambient Air Quality Standards for ozone (as reported in 1/2/15 Cotton's Week). This proposal has been met with strong skepticism and opposition in Congress and from affected industries, including agriculture.
The EPA plan proposes lowering the primary standard for protecting public health from 75 parts per billion (ppb) to a range of 65 to 70 ppb and is willing to accept comment on a level as low as 60 ppb. Under the Clean Air Act, the EPA is required to revisit air quality standards every five years.
EPA also has proposed changing the secondary standard, aimed at protecting the public welfare (protection of ecosystems and sensitive plants) using a cumulative form of measurement at a level of 17 parts per million (ppm) and incorporating a statistical index called the W126 index.
In its comments on the proposal, the NCC took issue with EPA's recommended use of the W126 index in the secondary standard and referred to the USDA's Agricultural Air Quality Task Force (AAQTF) white paper on ozone and to the AAQTF recommendation for EPA to work with USDA to identify an appropriate index that is more biologically relevant.
The NCC also urged EPA to consider issues around prescribed burning practices on forest, range and crop lands and cautioned the agency to review the impacts on those practices arising from a stricter ozone standard. Additionally, the NCC urged EPA to consider the "policy-relevant background" or "PRB" ozone levels, recommending that EPA should quantify uncertainties in PRB estimates and the potential impacts of inaccurately estimating the PRB on potential non-attainment areas and the cost of implementation for both a proposed primary and secondary standard.
A recent USDA news release announced $57.9 million in funding "to protect agriculture and plants from pests and diseases through the 2014 Farm Bill section 10007." The funding included "$461,119 to conduct surveys to determine the scope of the Old World Bollworm (Helicoverpa Armigera) infestation in Puerto Rico and collect and study samples of the pest, as well as $117,921 to survey for the Old World Bollworm in high-risk areas in Florida."
The NCC met with USDA's Animal & Plant Health Inspection Service (APHIS) in January to emphasize the cotton industry's major concerns and urged APHIS to enhance efforts to prevent an Old World Bollworm invasion. The NCC also encouraged APHIS to provide information to Extension entomologists to help prepare for possible Old World Bollworm infestations – which may change pest management strategies.
The Old World Bollworm is found in most cotton growing regions except for the United States.The Old World Bollworm moth closely resembles Helicoverpa zea, the corn earworm (also known as the bollworm) which is distributed throughout the United States. However, the Old World Bollworm historically has developed resistance to pesticides more rapidly than the corn earworm.
Because recent captures of Old World Bollworm in Puerto Rico have heightened a US invasion risk, the NCC continues to be closely involved in activities focused on invasion prevention.
Rootworm Resistance Comment Period Extended
As reported earlier, EPA is seeking public comment on a proposed framework intended to delay the corn rootworm pest becoming resistant to corn genetically engineered to produce Bt pesticides (see 3/6/15 Cotton's Week). EPA announced that the original comment deadline of March 16, '15 was extended to April 15, '15.
The proposed framework includes requirements on the manufacturers of Bt corn including:
In areas at risk of corn rootworm resistance, require crop rotation; use of corn varieties containing more than one Bt toxin; or other integrated pest management (IPM) strategies and stewardship for corn rootworm.
Develop and implement a strategy to better detect and address areas of resistance as they emerge.
Use different and improved scientific tests and sampling requirements to study the problem and more reliably ensure that resistance to the Bt corn toxin is identified.
The proposed framework, which for the first time would require crop rotation, would change the way farmers use Bt corn -- in order to slow the development of resistance with a goal of prolonging the durability and effectiveness of these plants to control the corn rootworm pest.
EPA's proposed framework is available under docket number EPA-HQ-OPP-2014-0805 atwww.regulations.gov/.
"Bales Not Picked Up Rule" in Effect
Warehousers with a Commodity Credit Corp. (CCC) Cotton Storage Agreement (CSA) are reminded that the final rule amending specific reporting requirements for "not picked up bales" has been in effect since the first reporting period of '15. The rule was published on Dec. 1, '14, in the Federal Register (FR) as a technical change that addressed a cotton industry initiative.
In the rule, the Farm Service Agency (FSA) clarified that bales made available, but not picked up by the shipper, can only be reported by the warehouse operator as bales made available for shipment for no longer than the first two weeks that such bales have been made available for delivery but have not yet been picked up.
The CSA rule change took effect on Jan. 1, '15. FSA's Dan Schofer, cotton program manager, Commodity Operations Division, informed the NCC that CCC-approved warehouses were notified of the change prior to the end of Dec. '14. The NCC also was informed that a fourth amendment to USDA's cotton storage agreement (CSA) has been drafted and will be sent to CSA holders as soon as soon as approval from the department's legal staff is received. Failure of a warehouse to sign and return the CSA Amendment 4 will result in the forfeiture of a warehouse's CCC approved status.
A link to the Dec. 1, '14, FR notice is on the NCC Flow-Shipment page at www.cotton.org/tech/flow/index.cfm. Select the link "Clarification of Bales Made Available for Shipment by CCC-Approved Warehouses" to view the final rule. The NCC Flow-Shipment page also contains a link to a summary report of "U.S. Warehouses Not Complying with Mandatory Reporting" that shows missed flow reports by state and region. The last USDA flow report revealed that 58 out of 350 warehouses had missed one or more flow reports during the previous 12 months.
'15 BWCC Recorded Presentations Now Online
The recorded presentations from the '15 Beltwide Cotton Conferences are now available online and available to those who attended the January forum. To access a recorded presentation, attendees must use their last name and registration ID numbers to login at: http://ncc.confex.com/ncc/2015/webprogram/start.html. Registration ID numbers and instructions were sent to attendees by an email from the NCC.
Mid-April is the goal for posting of the full '15 Beltwide Cotton Conferences proceedings.
Sales Rebound, Shipments Stay Strong
Net export sales for the week ending on March 12 were 246,900 bales (480-lb). This brings total '14-15 sales to approximately 10.2 million bales. Total sales at the same point in the '13-14 marketing year were approximately 9.7 million bales. Total new crop ('15-16) sales are 907,500 bales.
Shipments for the week were 320,600 bales, bringing total exports to date to 5.5 million bales, compared with the 6.5 million bales at the comparable point in the '13-14 marketing year.
Cotlook to Continue 1-3/32" Quotes
Beginning with the '15-16 marketing year, Cotlook Limited's medium grade price quotes will change from the current 1-3/32" length to 1-1/8" staple length. The new staple length will become the basis for the Cotlook A Index, with middling remaining as the color grade. The revised quality parameters are currently being reflected in the daily forward medium grade quotes for the '15-16 marketing year.
In response to US cotton industry requests, Cotlook, which announced this upcoming change in mid-14, will continue to report price quotes for middling 1-3/32" cotton. These price quotes are critical for implementing important provisions of the upland cotton marketing loan program, including the adjusted world price, the fine count adjustment and the global import quota. The 1-3/32" quotes will be published as part of Cotlook's daily Cottonquotes service.
In order to help facilitate Cotlook's data collection and reporting, US merchandising firms are encouraged to provide quotes for middling cotton of both 1-1/8" and 1-3/32" staple lengths. Merchandising firms that market both US and international growths are urged to submit the price quotes for all relevant origins.
