Wishing and hoping for better times to return to High Plains cotton is not an option for Plains Cotton Growers, Inc., says Steve Verett, executive vice president.
Getting even more involved in the political processes that affect agriculture in general, and cotton in particular, is a necessity, he said at the organization’s annual meeting at Lubbock.
“This is not the time to pull back. We have to spend what is needed to get things turned around on farm policy. We have the resources to do that, and we have hired staff to do that.”
A lot of people in the cotton industry “don’t understand what’s being done on their behalf to get through tough times,” Verett says. “We need board members to be involved. Every PCG gin member has the option of having a board member. If we don’t take our industry seriously, who will?”
He recalled that former Texas U.S. Rep. Charlie Stenholm once noted that a congressman could have the best idea in the world, but unless he could get 219 votes in the House, it wouldn’t matter.
“Farmers have made the investment in their crops; now they have to think about the political aspects. We have to think about it every year. This meeting is politically heavy — I planned for that.”
The agenda included a political observer from the Cook Political Report, the National Cotton Council’s vice president for Washington Affairs, two candidates for House District 19, updates from PCG President Shawn Holladay on farm policy activity over the past year, and a discussion of a new PCG political action committee by Kody Bessent, newly hired PCG vice president for operations and legislative affairs.
NEW PCG PAC
“We challenge all of agriculture to contribute to the PCG PAC,” Verett says. “Every dollar will go to friends of cotton campaign contributions. We will do all we can to continue to support this industry and keep it strong. Nothing is more important to the Lubbock economic community than agriculture in general and cotton in particular.
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Bessent explained the value of the new PAC. “It gives us a seat at the table,” he says. As a producer-led organization, the PCG PAC gets a lot of people involved, and provides a long-lasting means of support for candidates who support agriculture and cotton. “Congressmen who support agriculture need our support,” he says. “This is advocacy at work.”
Reece Langley, National Cotton Council vice president for Washington affairs, emphasized the challenges facing the cotton industry. Upcoming issues include appropriations, either a continuing resolution or an omnibus budget bill; the Trans-Pacific Partnership Agreement, which he says could be a lame duck item; emerging issues, such as regulatory and EPA oversight; GMO/biotech labeling (a bill has passed the House but not the Senate); and the Commodity Exchange Act/Commodity Futures Trading Commission reauthorization.
A few issues specific to cotton also warrant oversight, he says. The Other Oilseed issue remains on the radar. “We will continue to pursue having cottonseed designated as an ‘other oilseed,’ with eligibility for farm bill support. We have bipartisan support, and it has a lot of merit for bringing stability to the cotton industry. We’re also looking for legislative ways to accomplish this, but that’s a big hurdle.”
GINNING COST SHARE
Langley says short-term assistance includes ongoing efforts with the Secretary of Agriculture to implement a ginning cost share program under USDA authority to “facilitate marketing cotton. Ginning cost share fits into that category. But that’s only short-term relief; we’re also exploring long-term policy.”
Other issues the council is monitoring include the ‘actively engaged’ designation. A final rule was established Dec. 16, 2015, and has no effect on persons or entities with only lineal relationships. Cousins, nephews, etc., are not included in the exemption. Entities outside the family are restricted to no more than three persons allowed as providing only management to the farm operation. Langley says the actively engaged designation applies to general partnerships and joint ventures that consider adding more than one person as management only.
Marketing certificates, authorized for upland cotton in the fiscal year 2016 appropriations bill in the marketing loan program, are not subject to payment limitations or annual gross income requirements.
Participation in the Stacked Income Protection Plan (STAX), designed only for cotton, has been most heavily concentrated in the Texas Southern Plains, Langley says, noting that cotton farmers, more than other commodities, also took advantage of the average production history (APH) yield exclusion.
He reminds cotton producers that the cottonseed rider (insures cottonseed) is available through STAX.
HIGH PRIORITY ISSUES
The council is watching several high priority issues for cotton, he says. Under APHIS, the boll weevil eradication and pink bollworm eradication programs need continued funding, with an $11.5 million request. The Foreign Agricultural Service market access program and foreign market development programs need $235 million. “Cotton Council international is the biggest recipient of those funds,” he says.
USDA Agricultural Research Service funding needs include the three cotton gin labs, including one at Lubbock. The council will continue to try to prevent amendments to bills that would threaten the farm bill and crop insurance, and that would tighten payment limitations.
The council is monitoring the World Trade Organization, including the Nairobi ministerial conference, which “continues to focus on the U.S. cotton policy. China is likely exceeding WTO commitments for domestic support, and we’re watching their 50 million bale reserve. How is that going to be sold? Some likely will be moved in the next few weeks. China also has significantly reduced cotton imports — 80 percent less over the last five years.”
The anti-dumping claim by Turkey needs to be resolved, Langley says, to prevent tariffs from jeopardizing what has become one of the U.S. cotton industry’s top two trading partners. Vietnam is the other.
“Turkey likes U.S, cotton because of its quality and stability, but it must remain competitively priced. A high tariff will make that harder to maintain.” He says India is “maintaining a significant minimum support price for cotton and is now the world’s largest producer and exporter.”
An EPA label for dicamba and 2,4-D for use on new tolerant cotton varieties will be a significant benefit for the industry, Langley says. “We are also monitoring registration and revocation of key pesticides.” Those include sulfoxaflor, chlorpyrifos, and organophosphates. Neonicotinoids and pollinators are also on the NCC watch list. “And we are watching the Waters of the United States rule as it moves through ongoing court cases.”
PCG and other industry organizations see no shortage of political issues to monitor as cotton continues to struggle with low prices, high production costs, uncertain market fluctuations, and the always unpredictable weather of the Southwest.
Those and other issues, Verett says, should be incentives for growers, ginners, and others involved in Southern Plains cotton production to communicate with legislators, and to invest in supporting candidates who understand and support the region’s cotton industry.