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USDA Helps Cotton Producers Maintain, Expand Domestic Market

USDA Helps Cotton Producers Maintain, Expand Domestic Market
Image: Natalia Bratslavsky/iStock/Thinkstock

(MEMPHIS, TN, ) – U.S. Secretary of Agriculture Sonny Perdue today announced at the 66th Annual Mid-South Farm and Gin Show the U.S. Department of Agriculture (USDA) is taking action to assist cotton producers through a Cotton Ginning Cost Share (CGCS) program in order to expand and maintain the domestic marketing of cotton.

“America’s cotton producers have now faced four years of financial stress, just like the rest of our major commodities, but with a weaker safety net,” Perdue said. “In particular, cotton producers confront high input and infrastructure costs, which leaves them more financially leveraged than most of their colleagues. That economic burden has been felt by the entire cotton market, including the gins, cooperatives, marketers, cottonseed crushers, and the rural communities that depend upon their success.”

The sign-up period for the CGCS program runs from March 12, 2018, to May 11, 2018.

Under the program, which is administered by the Farm Service Agency (FSA), cotton producers may receive a cost share payment, which is based on a producer’s 2016 cotton acres reported to FSA multiplied by 20 percent of the average ginning cost for each production region.

Perdue added, “I hope this will be a needed help as the rural cotton-growing communities stretching from the Southeastern U.S. to the San Joaquin Valley of California prepare to plant. This infusion gives them one last opportunity for assistance until their Farm Bill safety net becomes effective.”

The CGCS payment rates for each region of the country are:

Region States Costs of Ginning per Acre CGCS Payment Rate
Southeast………………………………. Alabama, Florida, Georgia, North Carolina, South Carolina, Virginia.. $116.05 $23.21
Mid-South………………………………. Arkansas, Illinois, Kentucky, Louisiana, Missouri, Mississippi, Tennessee…………………………… $151.97 $30.39
Southwest………………………………. Kansas, Oklahoma, Texas………… $98.26 $19.65
West…………………………………….. Arizona, California, New Mexico……………………………….. $240.10 $48.02

CGCS payments are capped at $40,000 per producer. To qualify for the program, cotton producers must meet conservation compliance provisions, be actively engaged in farming and have adjusted gross incomes not exceeding $900,000. FSA will mail letters and pre-filled applications to all eligible cotton producers.

The program was established under the statutory authority of the Commodity Credit Corporation Charter Act.

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