DisasterAssistance Faces Veto Threat
Thanks To Iraq War Differences

Friday, March 30, 2007                              By Shawn Wade

      Democraticleaders in both the House of Representatives and the Senate have been talkingfor weeks about their plan to try and force a change in Bush Administrationpolicy toward conducting the Iraq war.

      Thosepromises were fulfilled over the last few days despite what appears to be avery real threat from President George Bush to veto the legislation. AnAdministration veto would send the Iraq war supplemental spending bill to aquick and early grave since the votes to override a veto don't seem to exist.

      Unlessa compromise can be found during the House-Senate Conference that moderates orremoves the non-binding troop withdrawal language currently in place, itappears that a Bush veto will also scuttle recently buoyed producer hopes thata long-awaited agriculture disaster assistance package included in the billwould finally be approved.

      What'snext? Nobody knows for sure, but unless something changes on one side or theother, it appears that disaster assistance supporters will most likely have toregroup and try again another day.

      Perhapsthe only bright spot that might be found in an Administration veto would be ifHouse and Senate leaders are able to put an agreed on agriculture disasterpackage in their pockets, ready to go the next time around.

      Theagriculture disaster package approved by the House of Representatives last weektotaled some $3.89 billion, compared to the Senate version, which because ofdifferences in payment rates and other provisions has a $4.14 billion pricetag.

      Aspresently approved, both the House and Senate disaster packages would allowproducers to choose only one of the three years covered by the program toreceive assistance. Both bills provide coverage for losses that occurred in2005, 2006 or 2007 through the date of the legislation's enactment.

      Sinceit is unclear exactly what the cut-off date for 2007 losses will be, it isimportant to note that Congress's intent appears to be providing assistance tofruit and vegetable growers who suffered freeze losses earlier this year.

      Areasof significant difference include the House's decision to limit eligibility toproducers who purchased crop insurance in the year of loss and the differentpayment rate levels. With non-insured crops ineligible for the program theHouse set a single payment rate equal to 50 percent of the established pricefor the eligible crop loss crop.

      TheSenate's language allows non-insured crops to receive benefits, but at asignificantly reduced level equal to only 20 percent of the established price.Senate proposed payment rates for insured crops would be 55 percent of theestablished price.

      Theseappear to be the major differences between two pieces of legislation andadditional information will likely become even more widely available as thework of the conference committee begins.

      Whetheror not this version of agricultural disaster assistance ever becomes law, itappears that legislators in both bodies continue to strongly support thedevelopment of a disaster aid package as soon as possible.

      PlainsCotton Growers will continue to press Texas Congressional leaders to act asquickly as possible to finalize and deliver a much overdue package to addressthe weather related losses that have impacted agriculture over the past twogrowing seasons.

Cotton Inc./NYBOT Offer Free Cotton
Marketing Workshop; Reserve Your Spot Today

      For the fourth year the NewYork Board of Trade, Cotton Incorporated and Plains Cotton Growers are hostinga free "Hedging with Options for Cotton Producers: Basic and IntermediateWorkshop." The workshop is designed to help producers develop and sharpen theirindividual cotton marketing skills.

      This year's workshop will beheld on Tuesday, April 17, 2007 at the Holiday Inn Hotel & Towers, locatedat 801 Avenue Q in Lubbock. The workshop will run from 8:00 a.m. through 5:00p.m. Lunch will be provided to all workshop participants.

      Workshop topics include: "Whyare options on cotton futures critical to your business?"; "What can options dofor you and how?"; "Actionable hedging strategies"; presentation of a 2007Production Cost Outlook by Dr. John Robinson of Texas A&M University; aMarket Outlook by Cotton Marketing Specialist Dr. O.A. Cleveland; apresentation on hedging Counter-cyclical payments by Kelli Merritt, fromCropMark, Inc., in Lamesa; and a session on practical application of the skillsand information provided during the workshop by Cotton Specialist Mike Stevensof Swiss Financial.

      For information about theconference contact Raquel Allen at the New York Board of Trade (212-748-4096),Jeanne Reeves at Cotton Incorporated (919-678-2370) or Shawn Wade at PlainsCotton Growers, Inc. (806-792-4904).

      Registration is required forthe conference and participants can register by telephone or email. Telephoneregistrations can be directed to Raquel Allen (212-748-4094) or Kay Wriedt(919-678-2271). Email registrations should be sent to one of the followingaddresses: rallen@nybot.com at the New York Board of Trade, or kwriedt@cottoninc.com at Cotton Incorporated.

 

Upland Cotton Average Price Received by
Growers Through February 2007

Friday, March 30, 2007                              By Shawn Wade

      CumulativeUpland cotton marketings through February 2007 total 9.135 million balesaccording to information released March 29 by the USDA National AgriculturalStatistics Service.

      According to USDAestimates, February 2007 cotton marketings totaled 1.253 million bales with anaverage selling price of 48 cents per pound. So far the 2006 Upland CottonWeighted Average Price calculated through February 2007 stands at 47.84 centsper pound.

      The followingtable shows the average price received each month by farmers and the associatedweighted average price based on prices and cumulative marketings from August 1through December 31, 2006.

      The 2006Counter-cyclical payment rate authorized under the 2002 Farm Bill will be basedon the 12-month Weighted Average Price Received by growers. For cotton the12-month Weighted Average Price will reflect price and marketings for the 2006marketing year. The 2006 cotton marketing year began in August 1, 2006 and endsJuly 31, 2007.

 

Average Price Received For2006-crop Upland Cotton (Weighted by Marketings)

 

Marketings

Prices

 

(000's of Running bales)

(cents/Lb.)

 

Monthly

Cum.

Monthly

Weighted

August

1,970

1,970

45.80

45.80

September

182

2,152

47.30

45.93

October

994

3,146

46.10

45.98

November

1,117

4,263

47.60

46.41

December

2,062

6,325

49.30

47.35

January

1,557

7,882

48.70

47.81

February

1,253

9,135

48.00

47.84

March

na

na

47.20*

na

Source: National AgriculturalStatistics Service; * = preliminary