Starting June 20, 2016, until Aug. 5, 2016, eligible cotton farmers will be able to sign up for a one-time cost share payment from USDA Farm Service Agency (FSA). Average assistance per producer is expected to be around $4,200 to $8,100.
The Cotton Ginning Cost-Share program will provide an estimated $300 million in total assistance payments. FSA Administrator Val Dolcini says farmers will receive a letter asking to verify some data – once that is returned to their local FSA office, payments will be processed shortly thereafter.
“We think this program is a way to provide meaningful, targeted, timely assistance to our nation’s cotton producers,” he says. “Some people don’t fully appreciate the cost of farming. This is a means of providing safety net support that benefits all Americans, really.”
The new program has the same eligibility requirements as the 2015 Cotton Transition Assistance Program, and participants must be actively engaged in farming and meet conservation compliances.
Texas cotton farmer Johnie Reed, president of Plains Cotton Growers, says growers are grateful for this opportunity.
“We greatly appreciate U.S. Secretary of Agriculture Tom Vilsack and the USDA for listening to the concerns of cotton producers and coming up with a viable short-term solution that will help us face some of our challenges,” he says. “We had hoped for some flexibility in the payment limit, but we are grateful for the assistance, because our producers certainly need it. We recognize that this is a program for the near term, and we remain committed to working with Congress and others in trying to establish cottonseed as an ‘other oilseed’ under Title I of the 2014 Farm Bill, which would provide long-term stability for our industry.”
American Cotton Producers chairman Mike Tate says the program will help stabilize the seven sector industry that employs around 125,000 Americans and pumps more than $75 billion annually into the nation’s economy.
“[We appreciate] efforts in providing marketing assistance to a commodity that is suffering a serious decline in market revenue partly due to heavily-subsidized foreign competition, with no signs of the commodity prices reaching the level needed to offset their production costs,” he says. “The industry will continue to work with Congress and USDA to seek long-term policy solutions that will provide stability for the cotton industry.”
The number of U.S. cotton gins is on a downward slope, decreasing from around 700 in 2010 to 560 in operation last year. Even so, according to the National Cotton Council, even with fewer gins, there is more than enough unused capacity to handle increased production. Generally, smaller gins with little or none of the newest technologies available represent the typical closures.
The rapid adoption of newer module pickers have added efficiencies within the cotton industries. Round cotton modules are more easily shipped because they can be loaded onto flatbed trucks and hauled via Interstate highways.
For more information about the Cotton Ginning Cost-Share program, visit www.fsa.usda.gov/cgcs.