Congress rewrote the cotton program in the 2014 farm law to resolve a WTO ruling that U.S. subsidies distorted world trade. In doing so, it replaced the longtime cotton subsidy program with revenue insurance and loans, reflecting the industry’s wishes.
Now, with cotton prices under pressure worldwide, the industry wants to a return to subsidies. To do so, “the cotton industry wants U.S. Agriculture Secretary Tom Vilsack to re-establish cotton as a commodity crop,” says DTN, defining it as an oilseed, rather than a fiber crop. Cotton, after all, yields a vegetable oil besides its best-known use in producing textiles. Cotton groups want USDA to declare cottonseed as an ‘other oilseed’ eligible for crop subsidies like other field crops, DTN says.
Under the traditionally structured Price Loss Coverage program, “other oilseeds” include canola, safflower, rapeseed, sunflower seed, flaxseed, crambe, mustard seed and sesame seed, with a reference price of 20.15 cents per pound.
“All we’re trying to do is get a support level where we can show bankers we can cash flow a crop,” Shawn Holladay, president of Plains Cotton Council, told DTN. Holloway and the president of the National Cotton Council said their groups are talking to lawmakers about starting a cottonseed support program.
“A USDA spokesman stated department officials are in the early stages of examining the issue,” said DTN. “USDA did not give any indication whether Ag Secretary Vilsack supports the request.”
Last month, House Agriculture chairman Mike Conaway of Texas told Lubbock broadcaster KCBD, “We are looking at cotton in particular to see if there are things we can do within the farm bill itself or the authorities there that the secretary of agriculture could do particularly with cotton seed and cotton seed oil that would give some relief.” Texas is the No. 1 cotton state. The Lamesa (Texas) Press-Reporter said Conaway told local growers that one of the best hopes for immediate assistance with low cotton prices would be for Vilsack to designate cottonseed as eligible for the “minor oilseed” price support. Cotton seed is separated from lint during the ginning process.
Over 60 percent of the weight of a cotton boll, the protective casing that contains cotton fiber and seed, is in the seed, which can be used as livestock feed and in making soap, margarine, lotion, lipstick and shampoo. Cotton Inc., the industry supported company for the research and promotion of cotton, touts cotton as “The fabric of our lives.”