THE NATIONAL COTTON COUNCIL RESPONDS TO CRITICAL ISSUES IN 2011

In 2011, the National Cotton Council responded to numerous issues that threatened to undermine U.S. cotton’s profitability.

The best example of that response was the crafting and industry adoption of a farm policy that was aimed at maintaining an adequate safety net for producers. That task was difficult because it had to not only meet producers’ risk management needs but fit within Washington’s new budget realties and be defensible within the World Trade Organization. The Stacked Income Protection Program (STAX) gained the respect of Congress and was included in an Agriculture Committee package that was prepared for delivery to the Joint Select Committee on Deficit Reduction. Even though that panel failed to approve a deficit reduction plan by their November deadline, we believe the STAX proposal will be given favorable consideration during the 2012 farm bill reauthorization.

Aggressive communication with Congress and the Administration was necessary throughout 2011, especially to ensure no disproportionate reductions for agriculture emerged in the federal budget process.

The following table provides a summary of farm program benefits on a per-bale basis for the state of Georgia, averaged over the 2008-2011 crops under the Food, Conservation and Energy Act of 2008.

Average Farm Program Benefits Per Bale Produced and for Georgia, 2008-2010*

Benefit

Per Bale

Georgia (millions)

Direct Payments

$28.88

$59.3

Counter Cyclical Payments

$19.59

$40.3

Marketing Loan Gains

$18.00

$37.0

                          Totals

$66.47

$136.6

*2011 Crop Estimates for Production, CCP, and MLG

The Council’s legislative agenda in 2011 also involved work on a number of important issues across a broad front, which included:

  • Working for the repeal of IRS Form 1099 requirements;
  • Seeking clarification for crop insurance indemnity eligibility for flooded cropland as a result of levee breaches along the Mississippi River;
  • Submitting detailed comments expressing agriculture’s concerns with the Department of Transportation’s proposed guidance on the applicability of its regulations to operators of farm implements and off-road agricultural equipment;
  • Working with cotton industry leadership and other groups to reject a series of damaging amendments offered during the agricultural appropriations debate;
  • Joining other agricultural organizations in opposing proposed revisions to Department of Labor child labor regulations that would curtail employment opportunities for youth in agriculture; and
  • Supporting legislation that ensures agriculture’s GPS tools are not compromised by other broadband operations

 

Monitoring World Trade Organization Doha Round activity remained a priority. The Council emphasized to U.S. trade officials that cotton only can be addressed as part of a comprehensive agreement encompassing all of agriculture.  We also asked the USTR to file an objection to India’s embargo on cotton and cotton yarn exports as a WTO violation.  Later in the year, the Council stressed to Chinese trade officials the need for greater transparency and market access.

In 2011, environmental issues continued to be formidable. The Council’s efforts ranged from urging passage of the “Reducing Regulatory Burdens Act of 2011” to pushing for an extension of the compliance deadline regarding EPA’s Spill Prevention, Control and Countermeasure program.

The Council also worked closely with Malathion’s registrant to secure EPA approval of a supplemental label for addressing the Boll Weevil Eradication Program’s needs through the end of 2011 and for restoring the label beyond that date.

In another important regulatory issue, environmental groups –seeking to expand on an earlier court decision– filed suit against the EPA to require them to consult with other federal agencies regarding the effects of 306 registered pesticides on 216 endangered species.  Of these, 17 of the most commonly used agricultural pesticides, which could impact every type of agriculture nationwide.  The Council and several other agricultural organizations filed motions to intervene so that we can participate in any settlement discussions.

The Council also is involved in efforts to bolster industry efficiency through improved cotton flow. The Council’s Performance and Standards Task Force was re-appointed and charged with making recommendations aimed at rewarding exceptional performance and penalizing poor performance.

In addition to the Council’s work on the farm bill, trade issues and in the regulatory arena, we have continued our focus on increasing export demand for US cotton, cottonseed and cottonseed products through the outstanding efforts of Cotton Council International (CCI). CCI once again was the largest recipient of combined Foreign Market Development and Market Access Program allocations, which has allowed it to continue to take advantage of cotton’s global appeal to promote and strengthen demand for the fiber.

The U.S. cotton industry has excellent prospects for profitable production and processing, but there are still many challenges ahead of us.  With Georgia’s continued leadership and support—in concert with other industry members—the Council will continue the development of consensus policies and implementation of effective programs to ensure success in 2012.

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