SURE Program Payments Beginning To Go Out
As Data and Processing Issues Are Ironed Out

Friday, March 5, 2010                               By Shawn Wade

      Two months into the Supplemental Revenue Assistance Payments Program (SURE) sign up period it appears that most of the program's implementation kinks are finally on their way to being ironed out by the USDA Farm Service Agency.

      For farmers on the Texas High Plains, and elsewhere, that have gone through the sign up process and not yet received their payment, the wait may be close to an end. This includes, apparently, producers who have been unable to sign up for the program due to issues involving peanuts as well as those who purchased pasture and rangeland insurance.

      Currently there is no deadline for completing the 2008 SURE enrollment process.

      According to USDA officials in Washington, some $100 million in SURE payments have already gone out and more are on the way. They indicate that over the next few weeks producers should see more SURE payments being delivered.

      FSA officials explained that as they fine tune the many processes needed to deal with the significant amount of data required to deliver the program it has sometimes been necessary for FSA staff to rework previously completed applications to verify that initial preliminary benefit calculations were accurate or, if necessary, substitute revised crop insurance yield or coverage information. USDA expects SURE payments to begin ramping up over the next few weeks.

      A big contributor to the sluggish performance that has occurred thus far is the complicated nature of the program itself. USDA officials say that despite the challenges they are having to deal with from a complexity stand-point, they are actively working to incorporate the final pieces of the SURE calculation puzzle, namely the incorporation of a producer's weighted average Counter-cyclical Program (CCP) payment yield, into a revised version of the SURE sign up software used to calculate preliminary SURE benefits today.

      The SURE program is significantly more complex than previous incarnations of ad hoc disaster assistance due to its application at the whole farm level, which often means dealing with multiple crops, as well as the fact that it addresses overall revenue on the farm instead of only focusing solely on yield-based losses.

      Adding to the complication is the fact that FSA is also working closely with the USDA Risk Management Agency to obtain crop insurance yield, coverage and loss data that must be incorporated into a producer's SURE Interim report.

      Cooperation between the two agencies has been good as they work together to insure that the producer information developed for the SURE interim report is as accurate and complete as possible.

SURE Benefit Estimator Version 3.0

      For growers who haven't had an opportunity to complete their official SURE sign up, but still need to develop an estimate of the benefit they are likely to receive, the Texas AgriLife Extension SURE Benefit Estimator remains available for download and use from the internet. Growers interested in using it are encouraged to download the new version 3.0 file.

      The file is available for download from the Plains Cotton Growers website, located at http://www.plainscotton.org, and from the South Plains Profitability Project website located at: http://southplainsprofit.tamu.edu. A copy of Microsoft Excel is required to view and use the estimator.

      With an official release date of January 25, 2010, key changes made in version 3.0 include the incorporation of input spaces for data included on a producer's Farm Service Agency SURE Interim Report and a producer's crop insurance premium information on a unit-by-unit basis.

      Another useful adaptation included in version 3.0 is the ability to toggle the Summary page to display the estimated amount of benefit payable through the Farm Service Agency's initial sign-up procedure or an estimation of the total amount of SURE benefit that might be payable once all SURE program features are implemented.

      These changes will allow the spreadsheet to more accurately calculate SURE guarantee amounts, including adjustments provided through implementation of provision of the American Recovery and Reinvestment Act (ARRA), and the amount of crop insurance premium a grower may deduct from their calculated total revenue.

      The Texas AgriLife Extension Service developed the original SURE Benefit Estimator with assistance from Plains Cotton Growers, Inc. more than a year and a half ago to help answer producer questions about the SURE program.

 

Estimated Weighted Ave. Price Received Up;
USDA Announces Advance CC Payment

Friday, March 5, 2010                               By Shawn Wade

      Cumulative Upland cotton marketings for the first six months of the 2009 marketing year totaled 6.291 million-bales according to information released February 26, 2010 by the USDA National Agricultural Statistics Service.

      That figure is 866,000 bales more than the amount marketed through the same period in 2008. USDA estimated January 2010 cotton marketings at 1.618 million bales with an average selling price of 60.6 cents per pound.

      The 2009 Upland cotton Weighted Average Price calculated through January 2010 stands at 60.52 cents per pound using figures from the six months of the marketing year.

      To date the calculated 2009 Upland cotton Weighted Average Price has climbed 8.52 cents above the 52-cent threshold where the Upland cotton Counter-cyclical payment begin to drop below the 12.58 cent maximum payment rate. The preliminary mid-month price reported for February 2010 was 61.7 cents per pound.

 

Continued on Page 2

      As a result of the latest price and marketing figures, USDA has announced an advance 2009 Upland cotton Counter-cyclical program payment of 1.03 cents per pound.

      The 2008 Farm Bill allows partial CCP payments to be issued after the completion of 180 days of an applicable crop's marketing year when the crop's effective price falls below its target price. The effective price equals the direct payment rate plus the higher of either: (1) the national average market price received by producers during the marketing year; or (2) the national average loan rate for the commodity.

      Based on provisions of the 2008 Farm Bill, the Upland cotton Counter-cyclical payment rate goes to zero when the Weighted Average Price Received hits 64.58 cents per pound.

      The following table shows the average price received each month by farmers and the associated weighted average price based on prices and cumulative marketings from August 1 through January 31, 2010.

      The 2009 Counter-cyclical payment rate authorized under the 2008 Farm Bill will be based on the 12-month Weighted Average Price Received by growers. For cotton the 12-month Weighted Average Price will reflect price and marketings for the 2009 marketing year. The 2009 cotton marketing year began August 1, 2009 and ends July 31, 2010.

Average Price Received For 2009-crop Upland Cotton (Weighted by Marketings)

 

Marketings

Prices

 

(000's of Running bales)

(cents/Lb.)

 

Monthly

Cum.

Monthly

Weighted

August '09

30

30

47.70

47.70

September '09

225

255

55.00

54.14

October '09

271

526

56.70

55.46

November '09

1,611

2,137

58.50

57.75

December '09

2,536

4,673

62.80

60.49

January '10

1,618

6,291

60.60

60.52

February '10

n/a

n/a

61.70*

n/a

Source: National Agricultural Statistics Service; * = preliminary

 

Cotton Incorporated Partners With GAP For
"Recycle Your Blues" Denim Drive March 5-14

Friday, March 5, 2010                         From the Cotton Board

      Cotton Incorporated announced today that they will be working with Gap to launch the COTTON. FROM BLUE TO GREEN. denim drive in about 1,000 Gap stores across the United States. Beginning March 5 and ending March 14, consumers across the country can donate used denim at their local Gap. All donated denim will then be given a "new life" by being converted into UltraTouchTM Natural Cotton Fiber Insulation, and donated to help build houses for communities in need. Consumers who donate their denim will receive a 30% discount off new denim purchases at Gap.

      "Cotton Incorporated is delighted to team with Gap on the COTTON. FROM BLUE TO GREEN. nationwide denim drive," said J. Berrye Worsham, President, and CEO, Cotton Incorporated. "Year over year, this program continues to gain momentum, building positive consumer impressions for cotton, and this collaboration with Gap will build on the program's success over the past five years."

      Since the program began, the COTTON. FROM BLUE TO GREEN. denim drive has recycled enough denim to create natural cotton fiber insulation for over 540 homes.

      The two-week denim drive is part of Gap's "Recycle Your Blues" event, where customers who donate denim will receive 30% off new denim purchases from Gap, GapKids or babyGap through March 14.

 

CCI Supporting New "Discover Natural Fibers
Initiative" To Build Demand For Cotton

Friday, March 5, 2010       From the National Cotton Council

      A coalition between Cotton Council International (CCI) and other international natural fiber organizations recently established the Discover Natural Fibers Initiative (DNFI) to increase awareness of natural fibers, including cotton.

      The DNFI extends the partnership initiated by the International Year of Natural Fibers (IYNF) Steering Committee organizations following a year of working together in 2009, dubbed the "International Year of Natural Fibers."

      "The Discover Natural Fibers Initiative will build on the success of the IYNF and adopt the same objective, which is to raise the awareness and profile of natural fibers, including cotton, and emphasize their value to global consumers while helping to sustain farmer income," said CCI President Wally Darneille. "Natural fibers, including cotton and U.S. cotton, are key economic contributors. The global recognition this initiative will bring to cotton and other natural fibers is well-deserved."

      The decision to continue working closely together was the result of an IYNF committee meeting held in Frankfurt, Germany, in January 2010.

      DNFI is an alliance of key international natural fiber organizations including CCI, the International Wool Textile Organization (IWTO), the International Cotton Advisory Committee (ICAC), the Bremen Cotton Exchange, the International Textile Manufacturers Federation (ITMF), the International Forum for Cotton Promotion (IFCP) and many others. Henrik Kuffner, Director General of IWTO, was elected as committee chair for the year 2010.

      Cotton—a natural, renewable and biodegradable resource—is the largest natural fiber in the global fiber, textile and apparel economy, now representing roughly 80 percent of all natural fibers consumed. Cotton represents hundreds of billions of dollars of economic activity and globally employs hundreds of millions of people from field to fabric to retail.

      CCI is the National Cotton Council's export promotions arm and carries out programs in more than 50 countries globally under the COTTON USA trademark.

      CCI's headquarters is located in Washington, D.C., with offices located in Memphis, London, Hong Kong, Seoul and Shanghai, in addition to a global network of representatives.

 

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