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Cotton producers defend farm bill changes
The National Cotton Council on Wednesday defended its farm bill reform ideas, which might be presented to the supercommittee this week by the leaders of the House and Senate Agriculture committees.
The group said it understands the farm bill that is being developed behind closed doors will contain a subsidy program the NCC has designed, and that program will not balloon when commodity prices dip. The cotton proposal delinks the commodity from target price-based countercyclical payments, the NCC said.
Senate Agriculture Committee Chairwoman Debbie Stabenow (D-Mich.) and House Agriculture Committee Chairman Frank Lucas (R-Okla.) are putting the finishing touches on a farm bill proposal to shave $23 billion from the deficit over 10 years.
Some groups are worried that if new subsidy programs for some crops are too attactive, farmers will switch crops and damage markets for those crops with less-generous government programs.
Meanwhile, fiscal groups, such as Taxpayers for Common Sense, are outraged by the “secret farm bill” talks, which they say are designed to ram a new five-year farm bill through the fast-track supercommittee process.
The Agriculture committee proposals under development would save money by doing away with direct payments to farmers and replacing them with several different programs for different commodities.
One option will be a “shallow loss” revenue insurance backed by producers of corn, soy and wheat. Another involves higher target prices for rice and peanuts.
NCC said statements by sources that cotton will be given higher subsidies — linked to higher target prices in lieu of the shallow-loss program — are false.
“In fact, as we understand the current negotiations within the [Agriculture] committees, cotton will have no target price and will also not be eligible for the shallow-loss revenue program being discussed for other commodities,” NCC spokeswoman Marjory Walker said.
“To our knowledge, the negotiations do not involve a higher marketing loan rate for cotton. We’ve actually proposed a formula that would allow the marketing loan to adjust to a lower level in times of low prices.”
NCC said its Stacked Income Protection Plan will not bust the budget when commodity prices dip and will not distort world trade under World Trade Organization rules.
Under the Stacked Income Protection Plan, growers would be able to purchase coverage to insure revenue and payouts would be made when actual revenue fell below 90 percent.
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