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Ginners fight cost/return squeeze

Operational costs for the nation's cotton gins continue to escalate, while declining returns from cottonseed further pressure margins, and the world's textile mills continue to demand higher quality fiber.

“Energy, labor, insurance, and other variable costs will require significant attention by gin management for operations to remain viable,” Larry McClendon, president of the National Cotton Ginners Association, said at the annual meeting of the Southern Cotton Ginners Association at Memphis.

The Marianna, Ark., ginner said the national association's technology committee “will be working with our industry's technical experts to review ginning operations and develop methods and techniques we can use to further reduce operating costs where possible.”

And, he noted, the National Cotton Council has created a cottonseed segment which will expand membership to the cottonseed merchant sector, in addition to retaining the interests of cottonseed crushers.

“This should be seen as an important step to maintaining a viable cottonseed industry that is so critical to gins.”

McClendon said the NCGA's executive committee continues to work with USDA, Cotton Incorporated, and the National Cotton Council's quality task force on important fiber quality issues.

“We continue to review the appropriate maximum level of moisture that can be added to cotton lint prior to the bale press in the ginning process. In it's last meeting, the task force directed NCC staff to re-emphasize the recommendation that maximum moisture content in baled lint cotton at the gin not exceed 7.5 percent and that gins with spray systems pay special attention to the amount of moisture being added.

“It is essential that research continues in this area to make sure the task force's recommendation is appropriate for preservation of our cotton's quality.”

The association, McClendon said, will seek “a comprehensive approach” toward dealing with all components of fiber quality, including cotton standards, measurement technologies, the marketing system, and ginning technologies.

“This becomes a bit more complicated as the majority of U.S. raw cotton finds its way into international marketing channels. Our communication links with foreign mill customers aren't nearly as strong as they have become in recent years with our domestic mills.

“We plan to increase our interaction with foreign mills through both Cotton Incorporated and Cotton Council International. We believe it's crucial that our ginning industry understand how the quality needs of international mills differ from those of our domestic customers, so we can effectively meet the quality requirements of all our customers and do our part to keep U.S. cotton competitive in all markets.”

McClendon said the association's air quality subcommittee will continue working with the NCC and ginner groups to address federal and state air quality requirements for gins.

“The subcommittee has been active in regulatory discussions this past year and will be working closely with the SCGA to address permitting issues in the Mid-South.”

Several members of the subcommittee have served as members of the USDA's air quality task force, which advises the secretary of agriculture on environmental issues affecting agriculture.

“We're fortunate to have ginner representatives in position to shape policy in this area that is so critical to the future of our industry,” McClendon said.

The association's legislative committee is monitoring priority issues that affect the ginning industry, he noted.

“For several years, the NGA and NCC have worked with Congress and other agricultural groups for necessary immigration reforms to provide an agricultural guest worker program, and we're closely monitoring legislation currently being considered in the House and Senate.

“We also attempted to incorporate language in last year's transportation bill that would have allowed states to issue special permits for module trucks to operate on the federal highway system, including interstate highways. We were unsuccessful, but we're continuing to work with individual states where this issue becomes a priority.”

Ginning industry leaders and association staff are also keeping an eye on efforts to limit benefits of the current farm bill, on trade issues that could have a significant impact on U.S. cotton trade and domestic production, and pressures to cut farm programs in order to balance the federal budget, McClendon said.

“I urge everyone to remain engaged in the political process to make sure agriculture's voice continues to be heard.”

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