Industry groups are encouraging more cotton eligibility under the Coronavirus Food Assistance Program (CFAP). Under the guidelines for the program, the U.S. Department of Agriculture (USDA) determined that extra-long staple (ELS) cotton producers would not be able to receive CFAP payments because the crop did not meet the threshold. While prices for ELS cotton did decline, USDA determined that ELS cotton prices did not fall by five percent or more between January and April and is therefore not an eligible crop.
“The National Cotton Council, Supima and the Association are working together to appeal that determination and asking USDA to reconsider ELS cotton through their formal appeals process. In doing so, we need your assistance. We need letters from growers and merchants urging USDA to include ELS cotton in CFAP,” the California Cotton Ginners and Growers Association (CCGGA) noted in a call to action letter.
Producers still have the opportunity to provide feedback on the need to establish ELS cotton eligibility under CFAP. Industry members can submit comments to the Notice of Funding Availability through June 22. Letters and comments can be submitted online. USDA will take the information that is submitted and will ultimately make a decision on ELS cotton eligibility after reviewing the comments. A decision on the matter is expected to be made sometime in late July.
CCGGA has provided important information to use as focal points in any comments sent to USDA. The COVID-19 pandemic has created a drop in demand for ELS cotton which has resulted in larger carryover stocks, as well as higher storage and interest costs. Export sales and shipments have experienced a significant reduction.
“Trade data published by U.S. Census Bureau provide indicate a decline in ELS market prices between January 2020 and April 2020. ELS cotton prices, as measured by per-pound export values declined by $0.08 per pound, or 7.2% between January and April,” CCGGA explains. “The latest price decline meets the 5% threshold established in CFAP over the appropriate timeframe.”