Cotton Growers Begin to Think About Next Farm Bill

Cotton Growers Begin to Think About Next Farm Bill

Cotton fields Cotton fields

July 28, 2016

The last Farm Bill passed after several years of record-breaking prices prompting Congress to shift the safety net towards crop insurance. Agriculture advocates say the economic environment heading into the next farm bill is likely to be different, as several years of low prices are exposing the 2014 Farm Bill's weaknesses.

Cotton growers know this first hand. The Stacked Income Protection Plan, "STAX," was supposed to be the solution, but with only 30 percent of eligible areas participating and first-year results still unknown, cotton growers are starting to ask whether Congress needs to update the program in the next Farm Bill. 

The National Cotton Council already has the next Farm Bill in its sights and is likely to revive its efforts to reclassify cottonseed as an oilseed. 

Reece Langley, the National Cotton Council VP of Government Affairs explains, "We were trying to find a way to provide some stabilizing policy for the cotton sector given where prices were, and the economic circumstances we were facing, and where participation was in STAX. And as we all know, whether it's STAX or any other underlying crop insurance policy, when you're in a period of long-term low prices, crop insurance is not designed to deal with that. We were trying to find a way to bring some stability back to the industry."

Langley says even though cotton prices were below the cost of production for many farmers last year, most who enrolled in STAX are unlikely to get a payment unless their area saw significant yield problems. But RMA Administrator Brandon Willis says farmers should give the STAX program another year before pushing for changes. 

Willis says, "[STAX is] such a different program that you have to give it time to see how it turns out. I don't think you can say much after just one year, especially one year [in which] only a few crops had it available to them. I think the next few years will dramatically help inform an educated Farm Bill discussion."

The National Cotton Council is already compiling their wish lists for the 2018 Farm Bill, hoping that planning ahead will help speed up the legislative process.

Cotton markets have been on the rise in recent weeks, but even so, Langley says that prices remain below the break-even point for many farmers. 

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