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July
17, 2001
NCC Outlines
Farm Bill Needs to Key Senate Panel
WASHINGTON, DC – The National Cotton Council
(NCC) described to a key Senate committee the farm policy concepts
that can support cotton farmers while indirectly underpinning U.S.
cotton’s processing and handling infrastructure.
In
testimony today before the Senate Committee on Agriculture,
Nutrition and Forestry, NCC Chairman James Echols relayed the NCC’s
recommendations for the upland cotton title of the next farm
bill.
He said the industry supports continuation of a
nonrecourse marketing loan, with redemption provisions keyed to the
world market price. He also urged continuation of the 3-step
competitiveness program for cotton with elimination of the 1.25-cent
threshold for Step 2 and continuation of the issuance of marketing
certificates.
"Elimination of the 1.25-cent threshold would
not provide nearly enough adjustment to fully offset the adverse
effects of a strong dollar," Echols said. "However, it would be a
move in the right direction and one that our industry fully
supports. Beyond this, we are continuing to explore other options
that could help avert the devastating exchange rate impact on our
industry."
He told the panel the NCC favors augmenting these
programs with a combination of fixed and counter-cyclical payments,
which, together with returns from the market, will provide producers
a return equivalent to what they have received in recent years from
all sources, including emergency assistance.
"We encourage
you to retain as much cropping flexibility as possible," Echols
testified. "We support base acreage provisions that will offer
farmers the choice of keeping their current payment base or opting
for an updated payment base."
Echols told the panel the NCC
also supports: 1) the retention of frozen yields, 2) the
establishment of a permanent program for cottonseed, 3) other
adjustments in program provisions to offset the double impact on
cotton of a strong dollar, 4) elimination of payment limits or, at a
minimum, retention of the 3-entity rule, and separate and reasonable
limits for each category of benefits.
The Memphis cotton
merchant told the panel the NCC also supports "a re-invigoration of
our export assistance programs," including changes to the export
guarantee program and increased support for the Foreign Market
Development Program (FMD) and Market Access Program. That includes
$43.25 million per year for the FMD program and restoration of
annual support for the Market Access Program to its 1992 level of
$200 million.
"We need to meet our competition aggressively,"
he said. "We look forward to working with this committee to improve
our export programs and to enhance our
competitiveness."
Regarding conservation, he said the NCC
supports the continuation of the existing conservation programs such
as Environmental Quality Incentive Program, the Conservation Reserve
Program and the Wetlands Reserve Program assuming adequate funding
is available.
"There is also support for incentive-based
programs that encourage conservation and environmental enhancements
to agricultural land," he noted. "But, commodity programs remain the
funding priority and there are concerns about restrictive payment
limitations."
Echols told the lawmakers that until commodity
titles are amended, the NCC urges Congress to continue to provide
relief to cotton producers similar to the emergency assistance
provided during the last three marketing years.
That
includes: 1) supplementing existing Agriculture Marketing Transition
Act (AMTA) payments with additional marketing loss payments at the
highest rates possible; 2) allowing producers to receive
supplemental payments on the higher of existing crop bases or an
average of recent planting history, provided adequate funds are
available, 3) mitigating the impact of limitations on supplemental
payments, enabling producers to qualify for total payments of not
less than the amount of AMTA and marketing loss payments received
for the 2000 crop, and 4) reauthorizing cottonseed payments when
seed prices are low.
The National Cotton Council of America’s
(NCC) mission is to ensure the ability of all U.S. cotton industry
segments to compete effectively and profitably in the raw cotton,
oilseed and manufactured product markets at home and
abroad. | |