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Mike Tate: New farm bill contains many NCC priorities

Cotton industry leaders worked to make sure cotton was returned to the status of a program crop in the Agricultural Improvement Act of 2018.

Cotton industry leaders know what it’s like to be left out in the cold, so to speak, so they worked doubly hard to make sure cotton was returned to the status of a program crop in the Agricultural Improvement Act of 2018.

Those who follow farm legislation know cotton was a non-entity in the 2014 farm bill. Keeping a low profile because of Brazil’s WTO case, cotton basically opted out of everything but the marketing loan, conservation programs and crop insurance in the law.

The fight to return cotton to the farm bill’s Title I started with the industry’s efforts to win funding for its seed cotton program in the 2017-18 budget process, according to Mike Tate, National Cotton Council chairman and a cotton producer from Huntsville, Ala. Tate spoke at the Friday morning Ag Update Session at the 2019 Mid-South Farm and Gin Show.

As part of the Council’s efforts to provide short-term economic relief for our producers, we also pursued inclusion of cotton in the ARC/PLC programs through the appropriations process,” said Tate, “It would have been a much harder task getting that accomplished in the 2018 farm bill if that had not happened.

“We greatly appreciate Congress’ passage last February of the appropriations bill that established seed cotton’s eligibility in the Title I ARC/PLC programs of the 2014 farm bill.”

Tate noted that sign-up for the 2018 Seed Cotton Program ended on Dec. 7, but county USDA Farm Service Agency offices are still working through the election and enrollment process for growers.

‘Solid safety net’

The new farm bill provides a “solid safety net” for producers and contains many of the Council’s policy priorities, he said. Those include:

• Continuation of the Seed Cotton ARC/PLC program for the 2019-2023 crops

• Full access to the marketing loan program – with all marketing loan benefits no longer subject to the payment limit provisions

• A yield update opportunity that can better align program yields with current production levels

• The maintaining of effective crop insurance products

• No reduction in current payment limits

• An adjustment to the “family farm” designation that will provide equitable treatment for all family farms, including nieces, nephews and first cousins in the family definition

• Full funding for the textile competitiveness programs

• Report language encouraging USDA to work with the industry to implement important changes designed to improve the flow of cotton into marketing channels

The textile competitiveness program remains important for the U.S. cotton industry because — while the domestic textile sector has shrunk — it remains one of U.S. cotton’s “best and most consistent customers,” and expanding the eligibility criteria for family members “is very important for many farming operations, especially here in the South.”

Tariff dispute

On the trade front, Tate noted, the tariff dispute between the U.S. and China has led to the U.S. share of the Chinese cotton market being cut in half. The latest numbers show the U.S. having only 12 percent market share for the August to December period, compared to 28 percent for the same period a year earlier.

“Currently, both the U.S. and China have agreed to postpone any additional trade sanctions to allow time for a negotiated agreement to remove the current tariffs already in place,” he said. “The Council has been actively conveying our concerns to U.S. officials regarding the impacts of the retaliatory tariffs.”

The Council was encouraged by U.S. Trade Representative Robert Lighthizer’s comments to the House Ways and Means Committee, acknowledging cotton is on the list of products that the U.S. expects to see substantial increases in Chinese purchases, said Tate.

“However, I would caution that there is still much work to be done to reach a final agreement. The Council, working closely with AMCOT and ACSA, will continue to monitor the trade talks and provide information to U.S. officials about reforms that can help U.S. cotton regain market share in China.”

Tate said the NCC was pleased the Trump administration has provided $12 billion for a tariff mitigation program that included a Market Facilitation Program that provides 6 cents per pound for all 2018 cotton production. The program’s sign-up expired on Feb. 14, and there is a May 1 deadline for certifying production.

An Agricultural Trade Promotion program for the expansion of market promotion and development activities in export markets is also in effect. “We are pleased with USDA’s recent announcement awarding Cotton Council International almost $9.2 million as part of this program.”

Tate noted EPA has announced a two-year registration and label extension — for the 2019 and 2020 crops — for specific dicamba formulations used on dicamba-tolerant cottons. “The Council worked closely with EPA leadership to minimize the inclusion of any unworkable label requirements being considered and on other regulatory issues,”

The Council will also be filing comments on EPA’s proposed rule for the Waters of the U.S. to provide more clarity and less impact on private property rights, Tate said.

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