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USDA Move to Increase Cotton Promotion Could Add Pressure to Prices

Funding for The Cotton Board and Cotton Incorporated stands to increase if a directive from the U.S. Department of Agriculture’s (USDA) Agricultural Marketing Service takes effect.

Assessments paid by importers of cotton and cotton-containing products under the Cotton Research & Promotion Program Order will rise 3.4% under a final rule issued by the Agricultural Marketing Service on Friday. This rule also amends the Import Assessment Table, which indicates the total assessment rate.

Assessments would increase to .0119 cents per kilogram from .0115 cents per kilogram to reflect an increase in the average weighted price of upland cotton received by U.S. farmers in 2017, the Agricultural Marketing Service said in a Federal Register notice. The revenues generated by these assessments are used to finance research and promotion programs designed to increase consumer demand for upland cotton in the U.S. and international markets.

This rule will be effective as of Oct. 16 unless significant adverse comments are received by Sept. 17, in which case it will be withdrawn, the service said. The purpose of the Cotton Research & Promotion Program is to carry out an effective program of research and promotion to strengthen the competitive position of cotton by expanding domestic and foreign markets, improving fiber quality and lowering costs of production.

The Cotton Board’s research and promotion activities are conducted worldwide by Cotton Incorporated. Founded in 1970, Cotton Inc.’s mission is to increase the demand for and improve the market position of cotton.