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Laying Down the Law

How have U.S. cotton’s priorities been conveyed?

gary adams, ncc

Gary Adams

■ At a recent USDA listening session, the NCC shared the industry’s needs for implementation of 2018 farm law programs administered by the Farm Service Agency, Risk Management Agency and Natural Resources Conservation Service.

NCC staff’s input included acknowledging the timely guidance that FSA and RMA issued regarding producer options for STAX or SCO coverage relative to seed cotton base acre enrollment in ARC/PLC.

The NCC also submitted detailed comments to USDA regarding this and other important changes in farm law. The comments at www.cotton.org/issues/2019/agact.cfm noted, for example, that because the ARC/PLC program for cotton is only available for those farms with seed cotton base acres (formerly generic base/Upland cotton base), there will be situations where producers may choose to purchase STAX crop insurance on their planted cotton acres.

The basis for this decision is because there are no seed cotton base acres on the farm or STAX may offer better revenue protection than ARC/PLC under certain price expectations.

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We also urged FSA and the National Agricultural Statistics Service to work with the cotton industry to ensure the necessary marketing year average price data is compiled in time for USDA to issue ARC/PLC payments as soon as possible after Oct. 1 following completion of each marketing year.

In addition, the NCC asked USDA to “consider planted” those base acres enrolled in a Conservation Reserve Program contract that expired between 2009-2016 (timeframe used for determining unplanted base under the Bipartisan Budget Act).

Our remarks emphasized the strong and time-sensitive need to make the required change in the formula used to calculate whether the Extra Long Staple Competitiveness Payment Program will be triggered. Specifically, USDA was urged to incorporate price quotes for comparable quality cotton of other origins that compete with our nation’s ELS cotton in the export market.

The NCC’s comments also reminded USDA that the new farm law’s report language asks that the agency make changes to the Cotton Storage Agreement and provider agreements for warehouse receipts to modernize the requirements for improving the timely shipment of cotton to end users.

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The NCC also reminded the agency to modify the foreign price quotes used in determining the adjusted world price for Upland cotton by using the three lowest foreign price quotes rather than the current five lowest quotes.

The final request to USDA was to continue with its recent practice of determining the annual “costs to market” adjustment to the adjusted world price by fully accounting for all costs related to the movement of cotton from a warehouse to a major export market.

What about farm law education?

■ The NCC joined other agricultural organizations in an early March letter to Agriculture Secretary Sonny Perdue emphasizing that producers need to know how the new farm programs will affect their operation. The Secretary was urged to quickly allocate funding for training and updating risk management resources.

These resources will assist U.S. producers with program election and enrollment decisions, including determinations about crop insurance eligibility and preferences.

Gary Adams is president/CEO of the National Cotton Council of America. He and other NCC leaders contribute columns on this Cotton Farming page.