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December 2, 2016
 

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Congressional Leadership Selections Continue

House Democrats selected leadership and House Republicans selected committee chairs.

Despite push back from some party Members, House Democrats re-elected Rep. Pelosi (D-CA) to her eighth term as Minority Leader over Rep. Ryan (D-OH). In the number two and three positions, House Democrats also re-elected Rep. Hoyer (D-MD) as Minority Whip and Rep. Clyburn (D-SC) as assistant Democratic Leader. In addition to the top three spots, the party also elected Rep. Crowley (D-NY) as chairman of the House Democratic Caucus and Rep. Sanchez (D-CA) as vice chair. 

House Republicans approved recommendations for leadership positions on each Committee.  The full list of recommendations is at http://bit.ly/2fTrHqo but some notable changes include: Rep. Frelinghuysen (R-NJ) will succeed Rep. Rogers (R-KY) as chairman of the Appropriations Committee, Rep. Walden (R-OR) will take over as chairman of the Energy and Commerce Committee, and Rep. Harper (R-MS) was appointed by the Speaker as chairman of the House Administration Committee. Each of these recommendations was to be presented to the full House Republican Conference on December 2 for official ratification.

 

EPA, Industry Win Anderson Seed Treatment Case

On November 21, a federal court in California ruled in favor of EPA and its industry coalition allies, including the NCC (as an Intervenor), in Anderson v. EPA, a lawsuit brought against EPA by plaintiffs including farmers, activist groups and beekeepers. The Court ruled in favor of EPA and the Intervenors and against Plaintiffs on each of the Plaintiffs’ claims.

Plaintiffs had asked the court to order EPA to regulate seeds treated with pesticides as if the seeds were the pesticides themselves. Currently, the pesticides applied to articles, in this case seeds, already are regulated under the Federal Insecticide, Fungicide and Rodenticide Act (FIFRA). Therefore, the articles themselves do not need to be regulated after the pesticide is applied to them. In essence, the Plaintiffs were asking EPA to regulate the same pesticide twice. This could have resulted in treated seeds being regulated as a pesticide and given planting control over to EPA under FIFRA.

 

NCC Supports Enlist Duo

The NCC submitted comments to the public docket in support of Enlist Duo prior to the December 1 deadline for filing comments.

The NCC’s comments emphasized the intense challenges with weed control, particularly with the evolution of glyphosate and acetolactate synthase-resistant pigweed, in cotton producing areas and noted that producers are seeking additional weed control tools for inclusion in their management plans. The NCC conveyed support for the registration of Enlist Duo as an additional tool needed to manage difficult weed populations and herbicide resistant weed species in all of the cotton producing states that EPA had proposed for the label.

The comments were in response to EPA’s brief notice to the docket that proposed to add cotton to the Enlist Duo label.

 

Rusty Patch Bumble Bee Comments Filed

The NCC submitted comments last week to the U.S. Fish and Wildlife Service (Service) on the proposed endangered listing of the Rusty Patch Bumble Bee (RPBB).

This listing of this bee, whose habitat is not wholly mapped out but ranges from the Eastern Seaboard to the Midwest, could have devastating effects on agriculture. Not only is the bee “ground nesting,” which could restrict agricultural soil practices, but pesticide applications would have to be restricted based on the bee’s nature to fly into the fields being sprayed.

The Service acknowledged that pesticides were a minor stressor to the RPBB and likely would decline as a stressor with better science and the advent of bee-friendlier products. However, the Service still is focusing on neonicotinoids as a problem despite evidence that the RPBB decline began prior to the introduction of neonicotinoids while other species of bumble bees are surviving and/or thriving in the same range. Also, the document provided no indication that the Service had consulted with the pesticide experts at EPA.

In response to the proposal, the NCC conveyed its disagreement with the science that the Service used and stated that the Service needed sound scientific evidence before moving forward with such a far-reaching listing.

 

Prevented Planting Factors Announced

The Risk Management Agency (RMA) announced updated factors for prevented planting coverage. The updates were made to address the recommendations of a 2013 USDA Office of Inspector General (OIG) report.

Prevented planting coverage provides producers with protection if they are unable to plant an insured crop by the final planting date. When adverse weather prevents planting, a prevented planting payment is made to compensate for the producer’s pre-planting costs generally incurred in preparation for planting the crop. These costs can include purchase of machinery, land rent, fertilizer, actions taken to ready the field, pesticide, labor, and repairs. The prevented planting factor is a percentage of the individual insurance guarantee and varies by crop, based on an estimate of pre-planting costs.

These updates were required to address the recommendations in OIG’s 2013 report: “RMA Controls Over Prevented Planting.” The OIG recommended that the agency review the prevented planting factors and make changes if necessary. RMA commissioned a third-party evaluation of prevented planting coverage, which provided recommendations for determining prevented planting factors.

The NCC submitted comments to RMA noting serious concern with the study’s methodology and reiterated that no change was warranted for cotton’s prevented planting factor. RMA evaluated the public comments and determined that adjustments to the evaluation’s recommendations were necessary for some crops.

RMA reviewed prevented planting factors for barley, corn, cotton, grain sorghum, rice, soybeans and wheat for 2017 as part of an effort to ensure that prevented planting factors most accurately reflect the pre-planting input costs of producers. While the prevented planting factors will be reviewed and updated for all crops with prevented planting coverage, these first seven crops are being updated for the spring 2017 planting season. Over time, the prevented planting factors may go up or down depending upon changes in input costs. RMA will evaluate the effectiveness of the recent changes and modify them as needed in coming years. The table below lists the updated prevented planting factors.

Prevented Planting Coverage Factors

Crop

Current

Recommendation from Evaluation

Final

Corn

60%

50%

55%

Soybeans

60%

60%

60%

Wheat

60%

60%

60%

Cotton

50%

35%

50%

Grain Sorghum

60%

60%

60%

Barley

60%

60%

60%

Rice

45%

45%

55%

 

 

Overtime Rule Delayed

On November 22, a federal judge in Texas granted a preliminary injunction to delay the implementation of the Department of Labor’s (DOL) new overtime rule. This injunction stems from a lawsuit filed by 21 states and multiple trade associations.

This new overtime rule, which was scheduled to take effect on December 1, would double the salary threshold for employees to qualify as exempt from overtime pay requirements from $23,660 per year to $47,476 per year. It also includes a provision to automatically update this salary threshold every three years beginning in 2020. In addition to these provisions, the DOL also believes the new rule will cost the nation’s businesses $295 million per year.

As a result of the court ruling: 1) employers do not need to implement changes by the December 1 deadline, although the court, after hearing the full case, could allow the rule to go forward; 2) the incoming Trump Administration now has more time to make changes and end the rulemaking permanently or issue a new rule; and 3) Congress could address the final overtime regulations during the lame duck or in the beginning of the 115th Congress under the Congressional Review Act.

The NCC will continue to work with other organizations to address concerns with the new rule.

 

2017 NCC Annual Meeting Registration Open

Information on the NCC's 2017 Annual Meeting, set for February 10-12, at The Fairmont Hotel in Dallas, TX, including links for online pre-registration and hotel reservations, is at www.cotton.org/news/meetings/am/. A general information booklet on the convention also has been mailed to industry members.

Room reservations also can be made by calling the Fairmont Hotel at 1-800-441-1414. The deadline for the special room rate is January 19, 2017, but that rate will be honored after the cut-off date based on the availability of convention-rated rooms. For air and car rental reservations, contact Kitty Rutledge, the NCC's travel consultant at Travelennium, at 800-844-4924 (ext. 322) or krutledge@travelennium.com.

The 2017 convention's first events begin at 1:30 pm on Friday, February 10. The final event, the General Session, begins at 10 am on Sunday, February 12, and concludes by noon on that day. The joint meeting of program committees convenes on Saturday, February 11, at 8 am and will include the NCC's planting intentions survey results. The Saturday luncheon will feature Karen Hughes, who is Burson-Marsteller worldwide vice chair and one of the world's foremost communication strategists.

 

Study Finds MAP and FMD Produce High ROI

As reported in the U.S. Grains Council Global Update, a new study conducted by the Agribusiness, Food and Consumer Economics Research Center at Texas A&M University found that USDA’s Market Access Program (MAP) and Foreign Market Development (FMD) program play a critical role in growing and maintaining export markets – which is essential for U.S. farmers and ranchers, especially at a time of low commodity prices and abundant supply. The study, which looked at the programs’ impact over the past four decades, found that these agricultural export market development programs – funded through the 2014 farm law – offer both farmers and taxpayers an excellent return on investment.

The study noted that the programs have contributed an average annual increase of $8.2 billion - for a total of more than $309 billion - to farm export revenue between 1977 and 2014. This equates to an impressive return on investment of 28 to 1.

“These programs have accounted for 15 percent of all the revenue generated by exports for U.S. agriculture over that time,” said Dr. Gary Williams, professor of agricultural economics and co-director of the Agribusiness, Food and Consumer Economics Research Center at Texas A&M University, who led the research team. “To me, such a positive result is just stunning.”

Other notable findings included:

  • As a result of MAP and FMD funding, average annual farm cash income in 2014 was $2.1 billion higher and average annual farm asset value was $1.1 billion higher when compared to 2002.
  • The programs increased total average annual U.S. economic output by $39.3 billion, gross domestic product (GDP) by $16.9 billion, and labor income by $9.8 billion over the same time.
  • These programs directly created 239,000 new jobs, including 90,000 farm sector jobs.

With debate on a new farm bill beginning already, researchers also examined what would happen if federal MAP and FMD funding were eliminated. They found that under such a scenario, average annual agricultural export revenue would drop by a staggering $14.7 billion, with corresponding declines in farm cash income of $2.5 billion and significant drops in GDP and jobs.

MAP and FMD comprise the federal portion of a unique public-private partnership through which some 60 organizations leverage federal funds and work with USDA’s Foreign Agricultural Service (FAS) to support market development initiatives around the world. Cotton Council International (CCI) has been a cooperator in the FMD program since 1956 and a participant in the MAP since 1986. Under these two programs, CCI has posted long-term success in export promotional activities for U.S. cotton.

The article noted that FAS funded the study that was sponsored by the U.S. Wheat Associates, the USA Poultry & Egg Export Council and the Pear Bureau Northwest. Informa Economics assembled data to support the study, recruiting a team of five agricultural economists from Texas A&M, Oregon State University and Cornell University.

The study is at www.uswheat.org/newsMeetings/emd-2b and its executive summary at www.uswheat.org/newsMeetings/emd-2a.

 

Sales Strong, Shipments Steady

Net export sales for the week ending on November 24 were 213,400 bales (480-lb). This brings total 2016-17 sales to approximately 7.5 million bales. Total sales at the same point in the 2015-16 marketing year were approximately 4.9 million bales. Total new crop (2017-18) sales are 509,500 bales.

Shipments for the week were 150,200 bales, bringing total exports to date to 2.8 million bales, compared with the 1.8 million bales at the comparable point in the 2015-16 marketing year.

 

 
Effective December 2-8, 2016

 

Adjusted World Price, SLM 11/16 60.66 cents *
Fine Count Adjustment ('15 Crop) 0.24 cents  
Fine Count Adjustment ('16 Crop) 0.34 cents  
Coarse Count Adjustment 0.00 cents  
Marketing Loan Gain Value 0.00 cents  
Import Quotas Open 13  
Special Import Quota (480-lb. bales) 828,326  
ELS Payment Rate 0.00 cents  
*No Adjustment Made Under Step I  
     
Five-Day Average  
Current 5 Lowest 13/32 CFR Far East 78.09 cents  
Forward 5 Lowest 13/32 CFR Far East NA
Fine Count CFR Far East 79.75 cents  
Coarse Count CFR Far East 80.20 cents  
Current US 13/32 CFR Far East 80.55 cents  
Forward US 13/32 CFR Far East NA