In a novel step, cotton growers would be eligible for two different crop-subsidy programs under a provision in the USDA-FDA funding bill approved by the Senate Appropriations Committee. The provision designates cottonseed, harvested from the boll along with cotton fiber, as one of the “other oilseeds” that can collect Price Loss Coverage subsidies while USDA runs a separate, insurance-like subsidy program for cotton fiber.
The National Cotton Council, an umbrella group speaking for the industry, said the cottonseed designation, which would apply to cotton grown in 2018, “would help address the significant economic challenges currently facing America’s cotton-farming families.” The cotton council says action is needed because of continued low cotton prices. A 2016 estimate put the cost of the cottonseed program at $1 billion a year.
The Obama administration created a cotton ginning cost-share program last year to provide a one-time payment of $300 million in aid to growers, calculated at roughly 40 percent of the cost that growers faced to run cotton through a commercial gin to separate the seed and the fiber. The USDA said it did not have statutory power to declare cottonseed an oilseed, so it implemented the cost-sharing program.
Earlier this week, the cotton council coordinated letters to President Trump from farm lenders, and one-quarter of the members of the House and Senate, asking for continuation of the cost-share program while the 2018 farm law is being written.
Along with approving the $150 billion USDA-FDA funding bill last week, the House Appropriations Committee approved non-binding language that encouraged USDA to make money available “for the purposes of providing assistance to the cotton sector” in fiscal 2018. The assistance could include cotton ginning cost-share payments or other methods, it said. “The committee further supports the inclusion of cottonseed as an oilseed.”