ELECTION RESULTS PUT NEW SPIN ON 07 FARMBILL DEBATE
AS DEMOCRATS TAKECONGRESS

Friday, November 10, 2006                        By Shawn Wade

      Prospects for a favorable2007 Farm Bill don't appear to have been significantly altered in the wake ofthis week's Democratic take over of Congress.

      According to Lubbock-basedPlains Cotton Growers, Inc., once observers get acclimated to the close marginthat will exist in the House, and the slim one vote majority that will controlthe Senate, they will remember that there wasn't much room for partisanship inthe Farm Bill debate to begin with and the need to build a bipartisan consensusremains the key to success.

      Farm policy debates havehistorically been bipartisan efforts from the outset, regardless of the partyin power, and Tuesday's results virtually guarantee that this will be the casein the coming months as well.

      As expected, post electioncommentary concerning agriculture policy has ranged from doom and gloom tofavorable, depending on the source. What remains unclear is if the debate,which general wisdom felt would be driven from the Senate, will now become moreof a balanced effort with House and Senate Agriculture Committees working inconcert with one another.

      Taking a look at the newlandscape in Washington shows that a strong supporter of the current Farm Billwill take the reigns of the House Agriculture Committee (HAC) when the new 110thCongress convenes in January 2007. The Senate Agriculture Committee will be ledby former Chairman Tom Harkin of Iowa who held the same position duringdevelopment of the 2002 Farm Bill.

      Minnesota RepresentativeCollin Peterson, who was an integral part of the bipartisan effort to secureour current Farm Bill back in 2002, will assume the lead role in the House andis expected to work closely with Democrat and Republican members of theCommittee to build a bipartisan base of support for the next Farm Bill.

      As a result of Tuesday'svote, a total of six Republican Agriculture Committee members will not returneither because they were defeated in re-election bids, retired or resigned.

      Currently the Majority partyhas 24 Agriculture Committee positions compared to the Minority's 21. Assumingthis ratio stays the same, Democrats will add three new Agriculture Committeemembers when they take control and the Republicans will lose three positions.

      Significant components of anybipartisan effort within the HAC will be current Democratic HAC member, andstrong supporter of agriculture, Representative Henry Cuellar from South Texasand both of the Republican HAC members from the West Texas area that currentlyserve on the Committee.

      Even though both the WestTexas Republicans are relatively low in seniority they are expected to remainactive members of the Committee.

      That bit of conjecture isbased on the fact that Lubbock Representative Randy Neugebauer appears to haveacquired enough seniority within the Committee to remain and continuesupporting the industry that is so important to his home district.

      The fact that four of the sixdeparting Republican HAC members were ahead of him in seniority meansNeugebauer may also have a chance to advance several rungs on the seniorityladder.

      The other current RepublicanHAC member from West Texas is Representative Mike Conaway of Midland. Were itnot for the fact that all but one of the departing Republicans were ahead ofhim in seniority, Mr. Conaway's place on the HAC might also have been at riskdue to the pending reduction in Republican Committee members.

      Fortunately for West Texassix Republican departures means that Conaway should also be assured hisposition on the Committee. Republicans will eventually have to identify threenew members to fill the remaining Minority slots next year.

      At this time current HACChairman Bob Goodlatte (R-VA), who has been a strong defender of the currentprogram, is expected to remain the highest-ranking Republican on the HAC. Otherkey cotton state Republican farm bill supporters expected to remain on the HACare Kansas Representative Jerry Moran, Oklahoma Representative Frank Lucas,North Carolina Representative Robin Hayes and Alabama Representative TerryEverett.

      Peterson's 2007 Farm Billtrack record includes the filing of a bill to extend the 2002 legislation,although he has also indicated a willingness to consider a long-term rewrite ofthe legislation in the wake of the WTO's Doha negotiation breakdown.

      What should be reassuring tofarmers and ranchers is that Peterson has clearly indicated that the structureof the 2002 Farm Bill is in line with his vision for the 2007 Farm Bill.

      Based on the late returns itappears that close Senate races in Montana and Virginia ultimately swung theDemocrats way and a change of leadership in the Senate will also occur.

      The Democratic takeover meanscurrent Senate Agriculture Committee Ranking Member Tom Harkin (D-IA) willassume the Chairmanship replacing current Senate Agriculture Committee ChairmanSaxby Chambliss. Chambliss becomes the Ranking Minority member of theCommittee.

      Harkin was Chairman of theSenate Agriculture Committee during debate and passage of the 2002 Farm Billand played an integral part in the inclusion of the Conservation SecurityProgram in that legislation.

 

6TH ANNUAL TEXAS COMMODITY SYMPOSIUM
Grand Plaza Room - Amarillo Civic Center
November 29, 2006 - 8:30 a.m.

 

AREA'S 2006 CROP BETTER THAN EXPECTED

Friday, November 10, 2006                        By Shawn Wade

      Word from USDA NationalAgricultural Statistics Service November 9 is that the U.S. cotton crop isbigger than expected due to favorable weather late in the season. ForecastedU.S. cotton production increased from 20.7 million to 21.3 million balesbetween October 1 and November 1.

      As much as a third of thatincrease was allocated to the Panhandle and High Plains production region ofTexas where crop prospects were raised by 210,000 bales to 4.01 million balesin the November report.

      The increase solidifiespredictions that the area is on track to produce its third largest crop behindonly the record-breaking 2004 and 2005 crops. The potential to eclipse the 4million-bale mark in 2006 is being achieved despite the loss of over onemillion acres of dryland cotton production due to a lingering drought thatplagued the region throughout the growing season.

      It is important to note thatdespite the big crop, over 25 percent of the land planted to cotton in 2006never made it to harvest and left a large number of producers hurtingfinancially as a result.

      Ongoing efforts to secure a2005-2006 crop loss assistance package to help affected farmers and rancherswas put on hold prior to this week's elections. Congress, however, is expectedto revisit the issue when Legislators return to Washington.

     

DON'T FORGET: CCC-633EZ INSURES LDP ELIGIBILITY

Friday, November 10, 2006                        By Shawn Wade

      USDA Farm Service Agencyoffices are encouraging all cotton producers to fill out and submit a CCC-633EZform to ensure LDP eligibility for all loan eligible 2006 crop production.Introduced in 2005 the CCC-633EZ has quickly become a useful marketing andincome-planning tool for producers.

      The form allows growers torequest Loan Deficiency Payments on the 2006 crop and acts as a global LDPrequest establishing LDP eligibility on all commodities the producer hasbeneficial interest in at the time.

      With a CCC-633EZ on fileLDP's can be requested any time during the loan/LDP availability period for thecrop. If beneficial interest has already been lost at the time of the requestthe LDP rate will be based on the rate in effect the day beneficial interestwas lost.

      Producers need only submit asingle copy of the form, which will be provided to all other county offices asnecessary by FSA. The CCC-633EZ procedure is available for all LDP eligiblecommodities.

      The form's tax planningbenefits stem from the ability of a grower to market their crop, but delayreceipt of the LDP benefit until after the start of the next tax year. The formensures that when producers sell a commodity and lose beneficial interest thatthey do not lose the opportunity to receive LDP benefits on that production ata later date.

      Page one of the CCC-633EZform establishes basic LDP eligibility for all crops that a farmer produces.Later in the season the farmer can use page 3 of the form to request LDP benefitson specific lots of cotton or lock-in LDP rates on harvested cotton in modulesmuch as they have in the past.

      It should be noted that usingthe new form and establishing LDP eligibility will not affect a producer'sability to enter cotton into the marketing assistance loan program instead ofobtaining an LDP.

      Prior to the 2005 crop, whenthe form was first introduced, producers who failed to request an LDP beforebeneficial interest in the crop was lost were ineligible for LDP benefits onthose bales.

COTTON eLDP OPTION ALSO AVAILABLE

      In addition to guaranteeingeligibility for LDP payments at the beginning of the marketing season, cottongrowers are also still able to take advantage of the electronic Loan DeficiencyPayment (eLDP) system that was opened to them in 2005.

      Using the eLDP system growerscan fill out their LDP request from home, or anywhere they can establish aconnection to the internet, and not have to actually go into their county FarmService Agency office.

      To participate in the programgrowers must complete an online application to obtain what is known as a USDAeAuthentication Level 2 Account.

      Signing up for the secureeAuthentication Level 2 account is an easy two-step process. The first step isto go online (http://www.eauth.egov.usda.gov/), create a user ID and password andprovide a valid email address. The second step in completing theeAuthentication process is to go to the county FSA office for identityverification. If they have not already done so, FSA personnel will also set upa customer profile for the grower and validate their farming and cropinformation.

      Once the eAuthenticationaccount is set-up a grower simply has to log in to the secure system via theinternet. The system is available 24 hours a day and allows producers toreceive LDP benefits by direct deposit usually within 48 hours.

      For more information aboutsigning up for either of these program options, contact the FSA at the USDAService Center nearest you.

 

2006 COTTON QUALITY SUMMARY

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

 

Week Ending October 26, 2006:

 

Office

Bales

Color

Leaf

Staple

Lamesa

59,518

21+ - 44%
31 - 50%

3.35

36.03

Lubbock

264,387

21+ - 50%
31 - 45%

3.24

36.28

 

Mike

Strength

Uniformity

Bark

Lamesa

4.07

29.38

80.78

13.1%

Lubbock

3.91

30.21

81.33

20.3%

 

 

Season Totals To Date:

 

Office

Bales

Color

Leaf

Staple

Lamesa

203,372

21+ - 51%
31 - 40%

3.16

35.93

Lubbock

592,359

21+ - 45%
31 - 46%

3.32

36.21

 

Mike

Strength

Uniformity

Bark

Lamesa

4.21

29.17

80.80

8.9%

Lubbock

4.02

30.27

81.36

16.2%