2009-crop Average Price Received By Growers
Rising; Marketings Top 7.5 Mil. Bales

Friday, April 2, 2010                                  By Shawn Wade

      Cumulative Upland cotton marketings for the first seven months of the 2009 marketing year totaled 7.553 million-bales according to information released March 30, 2010 by the USDA National Agricultural Statistics Service.

      That figure is 1.389 million bales above the amount marketed through the same period during the 2008 marketing year. USDA estimated February 2010 cotton marketings at 1.262 million bales with an average selling price of 65.0 cents per pound. The preliminary mid-month price reported for March 2010 was 63.9 cents per pound.

      The 2009 Upland cotton Weighted Average Price calculated through February 2010 now stands at 61.27 cents per pound using figures from the seven months of the marketing year.

      To date the calculated 2009 Upland cotton Weighted Average Price has climbed 9.27 cents above the 52-cent threshold where the Upland cotton Counter-cyclical payment begin to drop below statutory maximum payment rate.

      Based on these numbers the estimated marketing year-end Counter-cyclical payment rate has fallen to 3.31 cents per pound. Although declining, the projected payment rate remains in line with the projected final payment rate used by the Farm Service Agency to issue last month's advance 2009 Upland cotton Counter-cyclical program payment of 1.03 cents per pound.

      With an additional five months of marketings to be added to the equation, and prices currently holding near the 65-cent level reported for the month of February, further erosion of the projected 2009 Upland cotton Counter-cyclical Program payment rate continues to be a real possibility.

      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, 2009 through February 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)





(000's of Running bales)















































Source: National Agricultural Statistics Service; * = preliminary


USDA Risk Management Agency Releases
COMBO Policy Provisions For 2011

Friday, April 2, 2010                                  By Shawn Wade

      USDA's Risk Management Agency (RMA) has officially announced that the long-awaited combined insurance plan is ready to go and will be used for insurance coverage starting with the 2011 crop year.

      Often referred to as the COMBO rule, the new combination plan revises RMA's current Common Crop Insurance Regulations to combine the Actual Production History, Crop Revenue Coverage, Revenue Assurance, Income Protection, and Indexed Income Protection plans into a single insurance plan.

      To accomplish this task, RMA kept and combined the principle features in the five plans that producers bought most often. RMA also developed a single rating and pricing component so all insurance coverage is consistent in insurance protection and cost to producers.

      According to RMA the changes are designed to simplify the insurance process and eliminate some of the confusion that currently exists by eliminating many of the minor differences that exist among the five freestanding insurance products as they are sold today.

      "The COMBO rule creates one insurance plan that replaces five similar plans, which will greatly simplify the insurance process for agents and promote better understanding of the options available for producers," said RMA Administrator William Murphy. "The COMBO rule will also reduce the amount of paper that the companies have to deal with since multiple, similar plans are rolled up into one insurance plan."

      Revenue protection will still be available for barley, canola, corn, cotton, grain sorghum, rapeseed, rice, soybeans, sunflowers and wheat. Producers will now be able to choose revenue or yield protection for these crops using one plan.

      Other crops currently insurable under the Common Crop Insurance Policy will also be insured using the new plan. Provisions for crops with only yield coverage available will not change significantly.

      RMA will now offer only one set of policy materials, Special Provisions, and actuarial documents; one rating and pricing methodology; and one premium calculation, unlike in the past where there were multiple, similar sets of documents. This combination has reduced the number of documents agents and producers must read and process; is easier to understand with fewer pricing methods to compare; and provides less chance of errors for producers, crop insurance companies, insurance agents, and the Risk Management Agency.

      The Federal Register published the Common Crop Insurance Regulations, Basic Provisions; and Various Crop Insurance Provisions final rule on March 30, 2010.

      RMA administers the Federal crop insurance program. More information about RMA and its programs is available at http://www.rma.usda.gov.


COTTON USA Co-Sponsors Denim
Design Competition with Texas Tech

Friday, April 2, 2010                            By Jennifer Jackson

      Twenty-six students from Texas Tech University's College of Human Sciences will compete to create the most fashion-forward U.S. cotton-rich jeans for men and women in a "Denim Runway" contest co-sponsored by Cotton Council International (CCI). The winning students from Texas Tech's Apparel Design and Manufacturing program, in the Department of Design, will get to see how new designs go into commercial production at Denimatrix in Guatemala.

      "A large amount of U.S. cotton fiber goes into the production of denim jeans, and consumers all over the world love wearing jeans," said CCI President Wally Darneille. "This competition will give aspiring designers experience working with U.S. cotton denim fabric, in addition to exposure to the U.S. cotton textile industry, apparel makers in the Western Hemisphere and CCI's COTTON USA Program."

      The competition kicks off this week in Lubbock, Texas, and will conclude with a fashion show "TECHstyle" on April 24, during which the winning women's jean designer and winning men's jean designer will be announced. The competing students will design their jeans using U.S. cotton-rich denim from a Littlefield, Texas, mill owned by Plains Cotton Cooperative Association (PCCA).

      COTTON USA will sponsor the two winning designers on a trip to the Colombiamoda trade show in Medellin, Colombia, July 27-29 to promote their U.S. cotton-rich jeans and give them a comprehensive view of the industry, from fiber to processing to brand to retail. The COTTON USA stand at this important apparel trade show highlights U.S. cotton yarns and fabrics from COTTON USA Sourcing Program member mills. Attendance at Colombiamoda will give the winning student designers the opportunity to learn about the U.S. cotton textile industry and garment manufacturing companies throughout the Western Hemisphere.

      "We have such talented students in our department, and this competition gives them opportunities beyond their wildest dreams," said Cherif Amor, Ph.D., Texas Tech chairman of the Department of Design. "This opens doors to them they may never have thought possible."

      According to CCI's most recent Global Lifestyle Monitor (GLM), which researches consumer buying habits across 10 countries, 62 percent of global consumers surveyed love or enjoy wearing denim on a regular basis. Consumers surveyed own an average of 6.25 pair of jeans, and 23 percent own 10 or more pairs of jeans. The GLM is a joint CCI and Cotton Incorporated study carried out biennially.