cotton - Greenmount Press

marketing
will intervene in the market, in order to support prices. Its
effectiveness therefore depends on the scale of intervention by
the Corporation, and on the resources placed at the disposal of
that organisation. Should CCI buying prove sufficiently active
to maintain market prices at close to the MSP, the scope for a
downturn in Indian export offers would be limited.
In contrast to India or China, the US generally establishes
cotton policy for a five-year period, enshrined in the Farm Bill.
By now a new US Farm Bill should have been passed, covering
the period from 2013–14 to 2017–18. But for want of space
in the pre-election, legislative timetable, and the increasing
preoccupation with fiscal and budgetary matters, no measure has
yet been enacted.
At the time of writing, the possibility of passing a new law
before the year-end has not been ruled out entirely, though time
is short. If that does not occur, it remains to be seen whether
the current law will be extended for a year, or new legislation
brought forward in 2013. From a cotton perspective, the main
innovation of the draft versions of the law that ultimately stalled
in Congress was the replacement of Direct and Counter-Cyclical
Payments, to which producers are entitled under the existing
programme, with an insurance-based, revenue protection
scheme, known as the Stacked Income Protection Plan (STAX).
Such a system may be more palatable to some critics of the
cotton program, but until it is tested, one cannot predict how
tangible will be the influence of STAX on producers’ planting
decisions.
Some key elements of the cotton program, moreover, are likely
to be left intact, albeit with some adjustments. These include the
Marketing Loan, which is of major potential significance to the
international market, since it facilitates the export marketing of
US cotton, however depressed world prices might become. That
mechanism was incorporated into the US cotton programme in
the mid-1980s, and provides for payment of a marketing subsidy,
based on the difference between the US loan rate and the world
price, should the latter fall below the former. That condition has
not been met for some years, and would require a substantial
further decline of world prices to be triggered.
Market forces, rather than legislative considerations, are
already tending to shape the outlook for US cotton plantings
in 2013–14. Cotton is expected to lose ground, in face of the
lucrative returns currently obtainable for alternative crops such
as corn and soybeans. If the shift away from cotton is replicated
elsewhere, and economic conditions allow a more robust
recovery of consumption, world supply and demand may move
toward a more healthy equilibrium next season.
2013
Farm
Study
Tours
UK/Ireland (departs July 9 for 22 days)
Cast off those BAS Blues in early July and head to Old Blighty and
the Emerald Isle for three fantastic weeks. We’ll visit some of the
best farming operators in the UK. There will be plenty of time to
sample all the beauty and cultural attractions of the cities and
the countryside. Visit southern and northern Ireland, England,
Wales and Scotland. This tour also coincides with the Ashes and
Wimbledon.
South America (departs Aug 5 for
24 days)
From the beautiful lakes of Chile to rugged Patagonia, the
Argentine Pampas, Iguassu Falls, incredible farm developments
in Brazil and Rio. Then Peru – think Macchu Pichu. Plus options to
the Amazon, Galapagos, Easter Islands etc.
Turkey/Ukraine/Poland (departs Aug 21 for 23 days)
Turkey is one of the most fascinating countries to visit in the world
with its mix of cultures – east and west; Europe and Asia. We
will visit Gallipoli, and then travel through western and central
Turkey visiting some extremely productive agricultural regions.
A quick flight across the Black Sea to the Ukraine with its huge
areas of highly fertile soil. We will drive right through to Poland
visiting amazing new agricultural developments and onto southern
Germany.
Express your interest by giving us a call on
07 4659 3555 or
email travel@greenmountpress.com.au
or visit
www.greenmounttravel.com.au
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