USDA will begin fleshing out a cotton-ginning cost-share program as a response to the third year of low cotton prices and financial stress on growers, said Agriculture Secretary Tom Vilsack. “Based on our conversation yesterday with the (House Agriculture) committee, I have instructed our team to proceed forward,” Vilsack told reporters at USDA’s annual Outlook Forum. At the same time, House Agriculture Chairman Michael Conaway called the cost-share idea “would not stop the bleeding and barely cover the wound.”
“I confess that all of the smoke and mirrors have been very frustrating to all of us who are deeply concerned about the crisis that is unfolding in farm country and for all of the livelihoods that are at stake,” Conaway said in an essay on the website AgWeb. The Texas Republican reiterated his argument that Vilsack has the authority to create a subsidy program for cottonseed. The cottonseed program, at an estimated cost of $1 billion a year, is the cotton industry’s priority. Vilsack says USDA lacks the legal authority to declare cottonseed eligible for the same subsidies given to grains and soybeans.
On Wednesday, Vilsack said the cost share program could funnel $150 million into the cotton sector.
Cottonseed, which grows in the cotton boll along with cotton fiber, traditionally is a minor revenue source compared to the more valuable fiber. USDA’s Crop Values report says cottonseed production was worth $942 million and cotton was worth $3.9 billion in 2015. The average price for cottonseed was $227 a ton, or 11.3 cents per pound while the average cotton price was 62 cents per pound.