USDA Announces 2003 CCP Final Payment Rates &
2004 Advance Rates Oct. 22

LUBBOCK, October 22, 2004        By Shawn Wade

      Movingfrom speculation to confirmation, USDA Secretary Ann Veneman announced that thefinal 2003 Counter-cyclical payment rate for Upland Cotton would be 3.93 centsper pound.

      Theannouncement came during a radio address on Friday morning and also includedannouncement of the first 2004 Advance Counter-cyclical payment rates forprogram commodities.

      Venemanannounced that the 2004 advance payment rate for cotton would be 4.81 cents perpound. The Upland Cotton rates confirm the results of PCGÕs calculationspublished last week.

      VenemanÕsannouncement also included payment rates for peanuts, corn, grain sorghum, andwheat. Payment instructions for these crops were sent to State FSA offices onOctober 1. This allowed final Counter-cyclical payments for peanuts, whosefinal 2003 payment rate was already calculated, to be made earlier this month.These instructions also expedited the processing of 2003 Counter-cyclicalprogram overpayments on corn, wheat, and grain sorghum.

      Inaddition to the 2003 and 2004 Counter-cyclical program payments, October isalso the month when final 2004 Direct payments are made. Payment instructionsfor the final 2004 Direct payment for eligible commodities were transmitted toState FSA offices on September 30, 2004 with payments to be processed as soonas possible.

      Thetable below includes the final 2003 Counter-cyclical payment rates and thefirst 2004 advance Counter-cyclical payment rates for eligible programcommodities.


2003 Final Counter-cyclical and2004 First

Advance Counter-cyclical PaymentRates



Commodity (unit)

Final 2003

Counter-cyclical Rate

1st Advance 2004 Counter-cyclical Rate

Wheat (bu)



Corn (bu)



Sorghum (bu)



Upl. Cotton



Peanuts (short ton)



Soybeans (bu)



Oats (bu)



Rice (cwt)


Feb. 2005


Source: USDA

      Most producers asked to receive the firstadvance 2004 Counter-cyclical payment when they enrolled in the 2004 Direct andCounter-cyclical program.

      Anyproducer that did not ask for the advance at that time must file their requestbefore the end of October.

      FarmService Agency officials note that the cut-off date to request the first 2004Advance Counter-cyclical payment is October 29, which is also the last day thatCounty FSA offices will be able to issue the first 2004 Counter-cyclicaladvance payment.


Survey Cooperation Key To Accurate Cotton
Volume and Price Reporting

LUBBOCK, October 22, 2004        By Shawn Wade

      Announcementof the 2003 final Counter-cyclical payment rate is serving as a reminder of theimportant role the National Agricultural Statistics Service plays in thedelivery of the 2002 Farm BillÕs Counter-cyclical program.

      FinalCounter-cyclical program payment rates are computed based on the marketing yearaverage price received by farmers weighted by marketings.

      Inorder to collect this information for cotton, which does not have a mandatoryprice reporting requirement, cotton producers and NASS rely on the cooperationof cotton merchants. Merchants asked to participate in the voluntary cottonsurvey program provide accurate volume and price information for cotton that isused to develop the monthly average price received by growers and the marketingyear weighted average price received that is used to calculate Counter-cyclicalprogram payments.

      While100% participation has not been achieved, merchants asked to participate in thesurvey, can rest assured that the information they provide is kept strictlyconfidential.

      Theinformation NASS collects is not reported until the end of each month on whichit is collected and is, in fact, only used to create an aggregate estimate ofthe volume of cotton sold nationwide. Data is not used to estimate a statelevel volume and price total until after the end of the marketing year.

      PlainsCotton Growers leadership notes that the accuracy of the information providedto NASS is critical to the proper function of the Counter-cyclical component ofthe 2002 Farm Bill. PCG encourages every merchant contacted by NASS toparticipate.

Continued on Page 2


      Merchantswishing more information about the procedures used to conduct the cotton volumeand price survey can contact Troy Joshua, NASS Cotton Statistician, inWashington, DC, at 202-720-5944.


Monsanto Execs Trade Ideas with PCG

LUBBOCK, October 22, 2004        By Shawn Wade

      Representativesfrom Monsanto Corporation sat down with members of the Plains Cotton GrowersExecutive Committee earlier this week to discuss MonsantoÕs thoughts on theWest Texas market and to gather producer feedback on the companyÕs plans forthe 2005 growing season.

      Theexchange strengthened the close relationship that Plains Cotton Growers hasworked to develop with Monsanto over the past half decade. As a result of PCGinput several of the most innovative risk-sharing programs in the country havebeen pioneered by Monsanto and introduced on the Texas High Plains.

      Programslike the Monsanto Replant Program, the Crop Loss/Destruct Refund Program andthe 2004 Texas Cotton Crop Loss/Destruct Refund Extension Program have all beenstrongly influenced by the membership of Plains Cotton Growers.

      Duringthis weekÕs meeting Monsanto representatives were especially interested infocusing on the issues and decision-making processes that non-irrigated growersgo through when deciding about investing in technology enhanced varieties on theirfarms.

      Whileno details about 2005 Monsanto risk-sharing programs are available at thistime, the information shared during the meeting indicates a full-range ofoptions will be made available for producers.


      BothMonsanto and PCG representatives at the meeting indicated that the exchange ofideas was the key to ensuring that the latest technology is made available ataffordable prices. They understand that the partnership between the technologyprovider and the producer must continue to be one with mutual rewards andshared risks in the future.


USTR Files Appeal in Brazil Cotton Case

LUBBOCK, October 22, 2004        By Shawn Wade

      TheUnited States Trade Representatives office has filed its appeal of theBrazil/Cotton subsidy case with the Appellate Body of the World TradeOrganization in Geneva, Switzerland.

      In anOctober 18 letter, the USTR requested a review of the original dispute panelÕsfindings on 14 separate points. The filing starts the clock on what is supposedto be a 90-day appeal process.

      U.S.officials now have until October 28 to submit the remainder of the supportingdocumentation for each point of appeal and the errors alleged to have been madeby the panel. Following that submission Brazil will then be given five days tofile a counter-appeal on any points that were not found in their favor by theoriginal panel. It is expected that Brazil will file a counter-appeal at thattime.

      Theoverall position of the U.S., as stated in the letter, is that the panel thatoriginally heard the case made their determinations based upon a combination oferroneous legal interpretations and findings on issues of law as detailed inthe agreements under which the case was originally filed.

      Forproducers in the U.S. the filing will have little to no short-term impact otherthan knowing that the next step in the process has begun.

      Anewly appointed, three-member Dispute Settlement Body panel will hear the U.S.appeal. The panel will be selected from a seven person appellate body whosemembers are appointed by the WTO Chairman.