ABA and the Independent Community Bankers of America issued a joint letter to the U.S. Department of Agriculture today urging the USDA to designate cottonseed as an ‘other oilseed’ for purposes of the Agriculture Risk Coverage and Price Loss Coverage programs. Doing so would help bring stability and support to cotton producers currently struggling with steadily declining revenues and high production costs.
“The projection of continued declines in market revenue coupled with elevated levels of cost of production cause serious concerns among the lending community,” the letter said. “There is no doubt there will be cotton farmers who cannot qualify for financing next year.”
Cotton is the only traditional ‘program’ crop that is not protected by a fixed price protection policy from the Farm Service Agency under the 2014 Farm Bill. However, the bill does include statutory authority for the USDA to designate ‘other oilseeds’ for purposes of farm bill programs.