MEMPHIS – The National Cotton Council said a
farm bill concept paper offered by House Agriculture Committee
Chairman Larry Combest (R-TX) and ranking member Charlie Stenholm
(D-TX) is a good first step and focuses on the right issues for the
next farm program.
"The House Committee has presented a
bipartisan proposal on a new 10-year farm policy that enhances
support for producers, improves export assistance programs,
strengthens and enhances important conservation programs and is
sensitive to budget concerns," NCC Chairman James Echols said. "This
is a significant accomplishment. Chairman Combest and Rep. Stenholm
have demonstrated strong leadership by presenting this concept for
response. We applaud this bipartisan effort to complete a new farm
bill in a timely fashion. In many respects, this concept paper
follows a blueprint outlined by the Council in testimony before the
House Agriculture Committee, including the establishment of a new
counter cyclical program for cotton and other commodities.
"The Council appreciates the opportunity the Committee has
given us to review all aspects of this proposal in the coming days.
We look forward to sharing our response and recommendations next
Wednesday before the Committee."
The committee’s proposal
maintains planting flexibility and would continue decoupled payments
under the Agriculture Market Transition Act at ’02 levels while
providing a new fixed payment for soybeans of 34 cents per bushel.
The proposal includes a new counter-cyclical assistance
program based on target prices set at 1995 levels (72.9 cents/lb.
for cotton). While the $40,000 per person limitation for AMTA
payments is retained, a separate payment limit of $75,000 for
counter-cyclical payments for all crops would be
established.
The nonrecourse marketing loan program would be
continued with no change in loan rates except for a decrease in the
soybean loan rate to $4.92 per bushel and an increase in the grain
sorghum loan rate to $1.89 per bushel. Loan eligibility would
continue for 100 percent of current production as would the $75,000
limitation for loan deficiency payments and marketing loan gains.
Generic commodity certificates would continue to be
authorized.
The proposal would give producers the option to
update acreage bases based on more recent plantings or to continue
to use their AMTA contract acres. Oilseed acres must be included in
the acreage bases. Payment for both the fixed decoupled and
counter-cyclical programs would be made on 85 percent of the base
acres. Current AMTA payment yields would be used for both the fixed
decoupled and counter-cyclical payments.
While the
Committee’s proposal increases spending for commodity programs
significantly, budget constraints caused total income support to
fall below NCC’s recommended levels and precluded the removal of the
1.25 cent threshold on step 2 in this proposal.
Echols said
he was encouraged by visits this week with some Congressional
members regarding the U.S. textile industry crisis and that the
Council would work to find ways to enhance the overall
competitiveness of the textile sector. He said legislators expressed
high awareness of that industry’s dire straits, including the
negative impact of exchange rates.
"We received a favorable
response to the proposals we discussed for assisting U.S. textiles,
and learned there may be ways to address this concern outside farm
bill deliberations," Echols said.
The National Cotton
Council of America’s 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.
