Hutchison Addresses PCG Board;
Pledges Continued Effort On Disaster and Farm Bill

Friday, October 13, 2006                           By Shawn Wade

      Members of the Plains Cotton Growers Board met for the organization's October Board of Directors meeting to discuss the status of disaster aid, WTO trade developments and preparations for the 2007 Farm Bill debate. Closing out the PCG meeting was special guest Senator Kay Bailey Hutchison who addressed members of the PCG Board and approximately two-dozen guests during the lunch hour.

      Senator Hutchison's comments touched on a number of issues, but it was her comments on emergency disaster relief and the farm bill that garnered the lion-share of the producer audience's attention.

      Hutchison echoed many of the points that members of the PCG Board heard during their discussions with former House Agriculture Committee Chairman Larry Combest, of Lubbock, and National Cotton Council Vice President of Producer Affairs Craig Brown, of Memphis, TN.

      Senator Hutchison told the group that she expects agriculture disaster relief to find its way into an appropriations bill in the Senate and not as a stand-alone bill. Hutchison noted that she expects disaster aid might eventually become part of the Senate's agricultural appropriations bill.

      Earlier in the day both Combest and Brown had discussed similar thoughts, but adding that it is also likely that all of the unfinished appropriations bills could eventually be rolled together and passed as a single Omnibus appropriation when Congress returns.

      Pursuit of an Omnibus appropriation strategy, by what will then be a lame duck Congress, makes sense when considering the fact that there is a considerable amount of work left to be done and a relatively short window for getting it all finished.

      At this time, the Senate has approved a disaster assistance package with $2.5 billion in assistance to producers who suffered losses during the 2005 growing season. Leaders in the House of Representatives have taken more of a wait and see approach to the issue and have made no moves to address the situation, despite the urging of House members from both sides of the political aisle.

      With the additional, and wider spread, problems that have plagued the 2006 growing season efforts are already underway to expand on the Senate's current proposal and allow producers to receive support for either 2005 or 2006 losses. It is estimated that in 2006 drought and wildfires in Texas alone have caused well over $4 billion dollars in agricultural losses.

      Regarding the 2007 Farm Bill, Hutchison voiced her support for extending the policies of the 2002 Farm Bill, but cautioned the group that getting the job done would be a fight.

      "We're going to have to fight to make sure that all of our rights are protected and we do the right thing in the farm bill next year," said Hutchison, "We're going to have to gear up, but we're on it."

      In other business, the PCG Board received reports on the activities of Cotton Council International from CCI Executive Director Alan Terhaar of Washington, DC; received a Washington Legislative report from the National Cotton Council's Craig Brown; and discussed the formation of the Southwest Council of Agribusiness.

      The Southwest Council is an alliance of agricultural organizations, financial institutions, and businesses, established to actively advocate for strong agricultural policy which is so important to the businesses and economy of Texas and the greater Southwest area. The Council will be working through former House Agriculture Committee Chairman Larry Combest and Tom Sell of Combest, Sell & Associates, LLC, (CS&A), a government affairs group operating in Washington, DC, for the purpose of extending the 2002 Farm Bill.

      Brown noted during his report that budget issues will be an increasingly important part of both the disaster assistance debate and the coming debate regarding the 2007 Farm Bill.

      He noted that for cotton it is clear that the preferred outcome for the farm bill debate is for the 2007 Farm Bill to look just like current legislation. About the only difference many in the cotton industry would like to see is consideration of a permanent disaster assistance program that could be accessed in lieu of ad hoc disaster requests that have been increasingly hard to pass in recent years.

      Brown cautioned, however, that the potential impact of budget allocations and calls to address items such as energy and specialty crop issues means the cotton industry must be well prepared going into the debate in order to be successful.

      To that end Brown noted that the NCC is evaluating a number of alternative farm bill proposals that have been floated and is also working to develop cotton's strategy for the debate.

      During his report, Terhaar expressed his appreciation for PCG's support of the CCI export promotion program. He explained how CCI works to leverage industry sponsorship, like that provided by PCG, with government program funds to produce broad-based consumer awareness and promotion programs designed to increase demand for textile products produced with U.S. cotton.

     

FSA Announces Final '06 Direct Payment and
First '07 Counter-cyclical Payments

Friday, October 13, 2006                           By Shawn Wade

      USDA's Commodity Credit Corporation (CCC) has begun issuing $3 billion in final 2006 direct payments to producers with base acres enrolled in the Direct and Counter-cyclical Program (DCP) and announced the first partial 2006-crop counter-cyclical payments to producers on farms with Upland cotton and peanut crop acreage bases enrolled in the program.

      The Upland cotton advance payment will total 4.81 cents per pound, an amount equal to 35 percent of the maximum allowable Upland cotton counter-cyclical payment rate of 13.73 cents per pound.

      The peanut advance payment rate will total $30.45 per short ton. Provisions of the 2002 Farm Bill require USDA to issue the first partial counter-cyclical payment for eligible commodities during the month of October.

      Due to strong market prices that are equal to or exceed their target prices, advance counter-cyclical payments will not be made on wheat, corn, grain sorghum, barley, oats, rice, soybeans and other oilseed base acres.

      Producers enrolled in the DCP may receive counter-cyclical payments for eligible commodities when "effective" prices are less than the "target" price set in the 2002 Farm Bill. USDA calculates counter-cyclical payments based on historical base acreage and payment yields, not current production information.

      USDA's projected counter-cyclical payment rates were established using the October World Agricultural Supply and Demand Estimates (WASDE) published on October 12.

NRCS Announces 2007 EQIP Sign-Up Deadline

Friday, October 13, 2006                           By Shawn Wade

      The USDA Natural Resources Conservation Service (NRCS) in Texas has set a December 15, 2006 sign-up deadline for producers interested in participating in the 2007 Environmental Quality Incentives Program (EQIP).

      Funds allocated for the EQIP program help farmers and ranchers improve natural resources on private working lands in Texas by providing cost-share and incentives payments to producers applying approved conservation measures that help solve natural resource concerns.

      Local work groups, who identify the most important natural resource issues in the area, establish natural resource concerns in each county. Through EQIP, NRCS also funds projects that address special statewide resource concerns recommended by the Texas State Technical Committee. Targeted 2007 statewide resource concerns are animal waste, invasive species, plant condition, water quality, water quantity, and wildlife emphasis areas.

      Immediately following the end of the sign-up period, all applications will be ranked and producers with an approved application will work with an NRCS conservation planner to develop their EQIP contract and plan for implementation beginning in the spring of 2007.

      Local NRCS field offices have complete details for their county and the applicable state concerns. Additional information, including ranking criteria, eligible practices, and cost-share rates for all programs, can also be found on the Texas NRCS Web Site at: http://www.tx.nrcs.usda.gov/programs

2006 Cotton Quality Summary

      The following is a summary of the cotton classed at the Lubbock and Lamesa USDA Cotton Division Cotton Classing Offices for the 2006 production season.

 

Week Ending October 12, 2006:

 

Office

Bales

Color

Leaf

Staple

Lamesa

21,088

21

3

35.84

Lubbock

39,909

21

3

35.76

 

Mike

Strength

Uniformity

Bark

Lamesa

4.32

28.47

80.57

2.8%

Lubbock

4.26

30.36

81.36

3.5%

 

 

Season Totals To Date:

 

Office

Bales

Color

Leaf

Staple

Lamesa

29,413

21+

3

35.32

Lubbock

45,209

21+

3

35.32

 

Mike

Strength

Uniformity

Bark

Lamesa

4.41

28.58

80.59

3.8%

Lubbock

4.32

29.19

81.12

2.4%