The farm group representing U.S. soybean growers gave its support to making cotton eligible for crop subsidies as an oilseed as well as having its own subsidy program as a textile fiber. Soybeans and cotton are grown throughout the South and Southwest. The major soybean states are in the Midwest. “We do not believe a cottonseed program would have a negative impact on the production of soybeans or other oilseeds or on vegetable oil prices,” said the American Soybean Association in a letter to Agriculture Secretary Tom Vilsack.
The cotton industry laid out its request at a House Agriculture Committee hearing last week, blaming China and India for driving down world prices through unfair subsidies to their farmers. The U.S. season-average price for this year’s cotton crop is forecast to be the lowest in seven years.
Congress wrote a new cotton subsidy program in the 2014 farm law to resolve a WTO ruling against U.S. supports. The new program combines a revenue insurance policy with a minimum support price. ASA president Richard Wilkins said only 24 percent of cotton farmers enrolled for revenue coverage so they have little protection against low prices. The cotton industry wants to be defined as an oilseed, in addition to a fiber, in order to gain access to the same subsidy programs offered to grain and soybean growers.
House Agriculture chairman Michael Conaway said 100 representatives signed a letter in support of USDA using its discretion to support cottonseed as an “other oilseed” in the farm program.
The Environmental Working Group called the idea “double dipping” that could add $1 billion a year to farm subsidy costs. “Cottonseed subsidy payments would amount to about $100 per acre, roughly triple the projected payments to corn, sorghum and wheat growers enrolled in the program,” said EWG in a blog.