Texas Agriculture February 19, 2016 : Page 3

Vilsack fails to designate cottonseed as an oilseed By Jessica Domel News Editor Cotton farmers are expressing their disappointment with the U.S. Depart-ment of Agriculture’s (USDA) decision not to list cottonseed as an oilseed, which would have made the product el-igible for farm bill safety net programs. U.S. Secretary of Agriculture Tom Vilsack made the announcement Feb. 3 explaining that USDA lawyers feel the agency lacks the authority to au-thorize cottonseed coverage. Vilsack said Congress would have to authorize coverage of cottonseed and find a way to pay for it. He said the USDA would like to help cotton growers, but is unable to at this time. Congressman Mike Conaway of Texas is firing back. “Although your letter identifies several possible obstacles to the des-ignation of cottonseed as an oilseed, I respectfully disagree with your conclu-sion and assure you that your author-ity to designate cottonseed as an ‘other oilseed’ stands on firm legal ground,” Conaway, who is also chairman of the House Committee on Agriculture, said in a Feb. 5 letter to Vilsack. Texas cotton growers are also ex-tremely disappointed in the decision. “It could have very far-reaching ef-fects,” Dan B. Smith, Texas Farm Bu-reau (TFB) state director and fourth generation Floyd County cotton farm-er, said. “A lot of cotton producers in our state, especially on the South Plains, are marginal and are having a hard time getting refinanced for the next year.” Had USDA listed cottonseed as an oilseed, farm bill safety net programs like Agriculture Risk Coverage (ARC) and Price Loss Coverage (PLC) could have gone a long way in helping farm-ers refinance for another year. The cotton industry asked Vilsack to consider the listing as cottonseed is a coproduct, not a byproduct, of the cotton-growing process. “Cottonseed is actually the main product of the cotton plant, much like the corn kernels are the main product of the corn plant,” Smith said. “Oil-seeds are the main component of soy-beans. Lint happens to be a very viable byproduct of the cottonseed. Therefore, we thought if soybeans could be listed as an oilseed and subject to all of the government programs, cottonseed should, too.” If cottonseed were eligible for ARC or PLC, cotton growers would have an effective safety net for aid in times of low prices, bad weather or other disas-ters. “Had we gotten it, it wouldn’t have solved all the problems, but it would have gone an extremely long way in helping people stay in business,” Smith said. Cotton inputs are high and prices are low right now. Without the help of an effective safety net like ARC or PLC, there is a chance Texas and the nation could lose cotton farmers. “Cotton was practically left out of the last farm bill. All it really had was an insurance program called STAX. It had a target price in it, and cotton producers supported it, but at the last min-ute before it was voted on by Congress, the target price was taken out to please Bra-zil,” Smith said. Without a target price, STAX doesn’t really work for cotton farmers, he said. “If cotton was 80 cents or above, STAX could be a viable program. So that’s why I say cotton has practically nothing, whereas the grains and the oilseeds have ARC and PLC programs,” Smith said. Cotton prices are now down in the 60s. “The farmers who can grow anoth-er crop will. Very slowly we’ve been seeing some of that cotton ground going to grass,” Smith said. “The cot-ton industry coming back is a very slow process. There are those who are just going to tighten their belt and grow it as cheaply as they can. They hope.” When the cotton industry takes a hit, it’s not just the farmers who feel the pinch. Since cotton is infrastruc-ture-intensive, every business and person along the line who processes or handles cotton will also take a hit. “Up around Lubbock, we’re just a few cents away from los-ing the cotton industry. We re-ally are,” Smith said. “If we go below 60 cents, it’s going to be impossible to grow it. No one House Agriculture Committee Chairman is going to loan you money to Mike Conaway continues to urge Secretary grow it. You could lose the in-of Agriculture Tom Vilsack to designate dustry, all the infrastructure, cottonseed as an other oilseed. the way of life and rural com-munities. This is a very serious situ-an oilseed. And Conaway once again urged ation.” The end result would take a heavy Vilsack to consider the listing in his toll on both the local and state econo-letter. “Please know that I sincerely ap-mies. “Congress preciate that you share my concern can do some-for the crisis in cotton country. How-thing, but ever, it is important to underscore it would be that concern without urgent and extremely meaningful action will do little to risky,” Smith mitigate the grave situation that is said. “I pre-unfolding before us. Farmers and their sume they’re lenders are facing the beginning of the saying we’d 2016 planting season with increasing have to re-dread. You have the authority and the open the responsibility to act, and I respectfully farm bill. renew my request for you to do so.” Cotton is not covered by ARC and You’ve got lots of people PLC following what is referred to as wanting that the Brazil Cotton Case. In the case, Brazil alleged the U.S. to happen so they can gut it. That’s why you’ve got to be very careful about gave unfair subsidies to its cotton opening the farm bill. The Secretary of growers. As a result, U.S. officials promised Agriculture could have done it with-out reopening the farm bill. That was not to give direct subsidies to cotton farmers. the beauty part of the whole thing.” Texas Farm Bureau supports the Farm organizations like TFB, American Farm Bureau Federation, designation of cottonseed as an other National Cotton Council, American oilseed for federal farm program par-Soybean Association and others all ticipation. Updates will be posted on supported the listing of cottonseed as TexasFarmBureau.org. F EBRUARY 19, 2016 3

Vilsack Fails to Designate Cottonseed as an Oilseed

Jessica Domel

Cotton farmers are expressing their disappointment with the U.S. Department of Agriculture’s (USDA) decision not to list cottonseed as an oilseed, which would have made the product eligible for farm bill safety net programs.

U.S. Secretary of Agriculture Tom Vilsack made the announcement Feb. 3 explaining that USDA lawyers feel the agency lacks the authority to authorize cottonseed coverage.

Vilsack said Congress would have to authorize coverage of cottonseed and find a way to pay for it.

He said the USDA would like to help cotton growers, but is unable to at this time.

Congressman Mike Conaway of Texas is firing back.

“Although your letter identifies several possible obstacles to the designation of cottonseed as an oilseed, I respectfully disagree with your conclusion and assure you that your authority to designate cottonseed as an ‘other oilseed’ stands on firm legal ground,” Conaway, who is also chairman of the House Committee on Agriculture, said in a Feb. 5 letter to Vilsack.

Texas cotton growers are also extremely disappointed in the decision.

“It could have very far-reaching effects,” Dan B. Smith, Texas Farm Bureau (TFB) state director and fourth generation Floyd County cotton farmer, said. “A lot of cotton producers in our state, especially on the South Plains, are marginal and are having a hard time getting refinanced for the next year.”

Had USDA listed cottonseed as an oilseed, farm bill safety net programs like Agriculture Risk Coverage (ARC) and Price Loss Coverage (PLC) could have gone a long way in helping farmers refinance for another year.

The cotton industry asked Vilsack to consider the listing as cottonseed is a coproduct, not a byproduct, of the cotton-growing process.

“Cottonseed is actually the main product of the cotton plant, much like the corn kernels are the main product of the corn plant,” Smith said. “Oilseeds are the main component of soybeans. Lint happens to be a very viable byproduct of the cottonseed. Therefore, we thought if soybeans could be listed as an oilseed and subject to all of the government programs, cottonseed should, too.”

If cottonseed were eligible for ARC or PLC, cotton growers would have an effective safety net for aid in times of low prices, bad weather or other disasters.

“Had we gotten it, it wouldn’t have solved all the problems, but it would have gone an extremely long way in helping people stay in business,” Smith said.

Cotton inputs are high and prices are low right now. Without the help of an effective safety net like ARC or PLC, there is a chance Texas and the nation could lose cotton farmers.

“Cotton was practically left out of the last farm bill. All it really had was an insurance program called STAX. It had a target price in it, and cotton producers supported it, but at the last minute before it was voted on by Congress, the target price was taken out to please Brazil,” Smith said.

Without a target price, STAX doesn’t really work for cotton farmers, he said.

“If cotton was 80 cents or above, STAX could be a viable program. So that’s why I say cotton has practically nothing, whereas the grains and the oilseeds have ARC and PLC programs,” Smith said.

Cotton prices are now down in the 60s.

“The farmers who can grow another crop will. Very slowly we’ve been seeing some of that cotton ground going to grass,” Smith said. “The cotton industry coming back is a very slow process. There are those who are just going to tighten their belt and grow it as cheaply as they can. They hope.”

When the cotton industry takes a hit, it’s not just the farmers who feel the pinch.

Since cotton is infrastructure-intensive, every business and person along the line who processes or handles cotton will also take a hit.

“Up around Lubbock, we’re just a few cents away from losing the cotton industry. We really are,” Smith said. “If we go below 60 cents, it’s going to be impossible to grow it. No one is going to loan you money to grow it. You could lose the industry, all the infrastructure, the way of life and rural communities. This is a very serious situation.”

The end result would take a heavy toll on both the local and state economies.

“Congress can do something, but it would be extremely risky,” Smith said. “I presume they’re saying we’d have to reopen the farm bill. You’ve got lots of people wanting that to happen so they can gut it. That’s why you’ve got to be very careful about opening the farm bill. The Secretary of Agriculture could have done it without reopening the farm bill. That was the beauty part of the whole thing.”

Farm organizations like TFB, American Farm Bureau Federation, National Cotton Council, American Soybean Association and others all supported the listing of cottonseed as an oilseed.

And Conaway once again urged Vilsack to consider the listing in his letter.

“Please know that I sincerely appreciate that you share my concern for the crisis in cotton country. However, it is important to underscore that concern without urgent and meaningful action will do little to mitigate the grave situation that is unfolding before us. Farmers and their lenders are facing the beginning of the 2016 planting season with increasing dread. You have the authority and the responsibility to act, and I respectfully renew my request for you to do so.”

Cotton is not covered by ARC and PLC following what is referred to as the Brazil Cotton Case.

In the case, Brazil alleged the U.S. gave unfair subsidies to its cotton growers.

As a result, U.S. officials promised not to give direct subsidies to cotton farmers.

Texas Farm Bureau supports the designation of cottonseed as an other oilseed for federal farm program participation. Updates will be posted on TexasFarmBureau.org.

Read the full article at http://texasagriculture.texasfarmbureau.org/article/Vilsack+Fails+to+Designate+Cottonseed+as+an+Oilseed/2414096/292583/article.html.

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