MEMPHIS (Special) - The National Cotton Council today said its
members are pleased that a framework agreement has been reached by
House and Senate conferees on new farm legislation that can become
effective in 2002.
"America’s farmers and ranchers have been under the most severe
economic pressure that I can remember in my 42 years of farming,"
NCC Chairman Kenneth Hood said. "This agreement will provide a
substantially improved level of income protection that certainly
will be welcomed by all seven segments of the U.S. cotton
industry."
"The U.S. cotton industry, from producer to textile manufacturer,
would be helped by this bill, and there is not a segment of our
industry that isn’t in need of some help. I urge Congress to approve
the bill quickly so the uncertainty about policy for the 2002 crop
can be removed and we move ahead with reasonable expectation for
returns that will cover our costs."
Hood, a Gunnison, MS, producer, said NCC members are grateful for
the dedicated, resourceful leadership of House Agriculture Committee
Chairman Larry Combest (R-TX) and Ranking Member Charlie Stenholm
(D-TX). "Both have been steadfast in their efforts to fashion new
farm legislation that will help restore the economic viability of
U.S. agriculture."
He also applauded the leadership of Cotton Belt Representatives,
Chambliss (R-GA), Pombo (R-CA), Everett (R-AL), Lucas (R-OK) and
Dooley (D-CA) and commended Senate Majority Leader Tom Daschle
(D-SD) for stepping in at critical times, first to get a bill passed
by the Senate and later to help bring the conference process to a
completion.
Additionally, he said the industry is indebted to Senators
Lincoln (D-AR), Miller (D-GA), Breaux (D-LA), Landrieu (D-LA),
Edwards (D-NC), Cleland (D-GA) and Carnahan (D-MO) who played
important roles in keeping the Majority Leader focused on cotton’s
concerns in the conference’s waning days. Cotton Belt conferees
Cochran (R-MS) and Helms (R-NC), although in the minority among
Senate conferees, still managed to play an extremely important
role.
Hood said the agreement includes many of the principles that were
recommended by NCC delegates, including an effective marketing loan
and a combination of fixed and counter-cyclical payments.
"This delivery mechanism," Hood said, "helps to optimize benefits
while meeting spending restraints imposed by a congressional budget
resolution and WTO commitments that limit certain farm subsidies
that are considered to be trade-distorting."
Hood said provisions for updating bases and yields will be
helpful to many farmers whose cropping patterns have changed in
recent years and whose yields have improved. He also pointed to
increased spending authority for the development of overseas markets
for U.S. agricultural products as positives in the conference
agreement, as well the maintenance of competitiveness provisions for
extra long staple cotton and fixing the ELS loan rate at the current
level.
With respect to new payment limit provisions, Hood said, "The
framework agreement reduces the benefits available to larger
enterprises, but it appears to strike a reasonable balance between
the calls that have been made for payment-limit reform and the need
to ensure that commercial size farming operations can remain
viable."
Hood said that the imposition of a means test and the reduction
in the amount of benefits a program participant may receive
constitute significant reform.
"The means test will disqualify the pro athletes and media moguls
that have been targeted," Hood said, "but some higher revenue,
legitimate farm operators also will be affected by the means test.
The reduced limits for payments and marketing loan gains could
reduce benefits to a significant number of farmers, but,
importantly, the 3-entity rule and provisions for loan redemptions
with certificates are being maintained. This will permit U.S.
agricultural commodities to continue to move to market rather than
be forfeited to the Commodity Credit Corporation."
Hood noted that maintenance of provisions for certificate
redemptions appears to reflect lawmakers’ understanding of the need
to facilitate aggressive marketing on the part of American
agriculture in a highly competitive global market.
W. Duke Kimbrell, NCC vice president and chairman of the largest
U.S. cotton user, Parkdale Mills in Gastonia, NC, noted that,
"Elimination of the 1.25-cent threshold for Step 2 payments will be
extremely helpful to the U.S. textile industry in its efforts to
recover from unprecedented economic stress due in large measure to a
strong dollar and surging Asian textile imports."
The Memphis-based NCC has a mission of ensuring the ability of
all seven U.S. cotton industry segments to compete effectively and
profitably in the raw cotton, oilseed and manufactured product
markets at home and
abroad.