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Farm Service Agency Public Affairs Staff 1400 Independence Ave SW Stop 0506, Room 3624-South Washington, D.C. 20250-0506
Release No. 1439.08
WASHINGTON, June 11, 2008 - The U.S. Department of Agriculture's Farm Service Agency (FSA) today announced the availability of loan rate differential schedules for the 2008 crops of upland and extra long staple (ELS) cotton.
Tables of upland and ELS cotton differentials and schedules of loan rates for individual qualities for 2008 ELS cotton are available on the FSA Price Support Division Web site at http://www.fsa.usda.gov/FSA/webapp?area=home&subject=prsu&topic=lor. The schedules are used by the Commodity Credit Corporation (CCC) in making nonrecourse marketing assistance loans and include factors such as grade, staple length, color and leaf qualities.
Later, marketing assistance loans for 2008 crop cotton will be available from CCC under regulations which will implement the 2008 farm bill. This release of loan rate adjustments in advance of loan availability provides time needed for industry automated systems to be updated for 2008 crop loan applications. A separate news release will announce when 2008 crop cotton loan applications can be accepted. New procedures were used to develop the 2008 upland cotton crop schedules, including the following:
- use of 3-year, weighted moving average spot market prices to establish quality adjustments;
- establishment of a single micronaire schedule applicable to all staple lengths;
- modification of the value differences between 32 and 33 staple lengths due to micronaire;
- establishment of leaf grade ranges such that no leaf grade has a premium/discount higher than that for the leaf grade that is one better than the color grade; and
- elimination of warehouse location differentials.
The new procedures are based on industry recommendations developed over the past year and reflect statutory requirements in recently enacted farm legislation. The new procedures are designed to provide a more market-oriented marketing loan program for upland cotton.
The 2008 crop schedule of differentials is applicable to CCC base-quality loan rates of 52.00 cents per pound for the base grade of upland cotton and 79.77 cents per pound for ELS cotton.
FSA news releases and media advisories are available on FSA's Web site at: http://www.fsa.usda.gov.
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