Recent Changes in U.S. Cotton Policies

摘要

On February 9, 2018 the U.S. Congress passed budget legislation that included the designation of seed cotton (unginned upland cotton that includes both lint and cottonseed) as a covered commodity under Title 1 Price Loss Coverage (PLC) and AgricultureRisk Coverage (ARC) programs in the 2014 Farm Bill beginning with the 2018 crop. Beginning with the 2019 crop, a farm enrolled in coverage for seed cotton is not eligible for STAX. This event marks a significant backward change in cotton farm policies from insurance programs to guaranteed payments based on reference price similar to counter cyclical payments in effect under the 2008 Farm Bill. This change will mean a significant increase in support to upland cotton production. The new program is basedon seed, not lint cotton, yet will result in increased income support to cotton producers in a manner similar to pre-2014 Farm Bill and is likely to result in increased U.S. cotton plantings. This new program is expected to be remain in the 2018 Farm Bill currently being drafted.