The National Cotton Council prepared a document that provides significant clarity regarding the new Seed Cotton Program that was contained in recently enacted legislation.
What’s the major policy change?
• As noted in the March column, the Bipartisan Budget Act of 2018 makes “seed cotton” (upland lint and cottonseed combined) eligible for the Agriculture Risk Coverage/Price Loss Coverage (ARC/PLC) policies in Title I of the 2014 farm law beginning with the 2018 crop year. There are three major decisions that must be made by farm owners and cotton producers: 1) electing coverage for seed cotton in either ARC or PLC, 2) choosing which option to update payment yields for upland cotton lint yields, and 3) deciding on the option for converting generic base acres to decoupled, crop-specific bases effective for the 2018 crop.
Payments under the new seed cotton ARC/PLC program for 2018 will be paid after Oct. 1 of the year the marketing year is completed – i.e. October 2019 for any 2018 crop year payments. Extra-long staple cotton is not eligible for the seed cotton program.
What do producers need to know about the program?
• There are several rules and some options involved. That’s why the NCC initially posted a seed cotton program summary and other documents on our website. We recently prepared a comprehensive “Seed Cotton Program Frequently Asked Questions (FAQ)” document based on the numerous questions received during and following the educational webinars the NCC conducted for our members and interested stakeholders after the Act’s passage in February.
The FAQ document is organized by topic. Most of the questions focus on generic base conversion, yield update and yield/planting history. Among other topics addressed in the FAQ were: PLC/ARC election/prices/payments; the lint, cottonseed and seed cotton marketing year average prices; CRP land; landowner signatures/power of attorney; payment limits; the marketing loan program; and the Farm Service Agency’s implementation timeline.
For example, it was asked if STAX will continue to be available? The answer is that after the 2018-19 crop year, the legislation’s intent is that producers can choose between either enrolling in PLC/ARC or purchasing STAX on a farm.
At the time this column was submitted, the NCC was still awaiting answers to some questions asked during the webinars. Answers to these and other questions will be added to the FAQ document as they are acquired.
The NCC is working closely with USDA and the Congressional agriculture committees on the seed cotton program’s rulemaking and implementation process. Meanwhile, I strongly encourage industry members to review the FAQ document at www.cotton.org/econ/govprograms/seed-cotton-program.cfm where the program summary and other updates also reside.
Gary Adams is president/CEO of the National Cotton Council of America. He and other NCC leaders contribute columns on this Cotton Farming magazine page.