[New York Cotton Exchange Circular No. 56, December 6, 1963] Page: 2 of 4
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S verplantinq of Allotmenu - Lor the 1964, 1965 and 1966 crops,
if the national acreage allotment exceeds 17 million acres, the
amount of such allotment in excess of 17 million acres would be
equally divided: one-half to producers by means of the regular
allotment procedure and one-half to producers who are willing
to produce cotton at world market prices. In no case would a
producer be permitted to exceed his regular allotment by more
than 20 per cent. The production from the overplanted acreage
would have to be sold at world market prices.
S. Unrestricted Sale of CCC Inventory Stocks of Cotton - Beginning
August 1, 1964, the Commodity Credit Corporation would be author-
ized to sell upland cotton for unrestricted use at not less than
105 per cent of the current loan rate plus reasonable carrying
charges instead of 115 per cent of the current loan rate plus
reasonable carrying charges as presently required by law.
6. The Research - The Secretary is authorized and directed to
conduct a special research program designed to reduce the
cost of producing cotton. The bill authorizes an appropriation
of a sum not to exceed $10 mil-ion annually for the Secretary
to carry out this special program.
The one major change in the bill involved the amount of discretion given to
the Secretary of Agriculture to establish Le PIK payment rates. The Cooley
Bill as passed by the House Committee on Agriculture gave the Secretary dis-
cretionary authority to set the rate from date of enactment until July 31,
_964. The rate of payment from August 1, 1964 until July 31, 1967 would be
he amount necessary to make cotton available to domestic mills at a price
cot in excess of the price at which cotton is made available for export. The
bill as amended and passed by the House of Representatives gives the Secretary
of Agriculture complete discretion in determining the amount of payment re-
quired to eliminate the inequity suffered by U. S. mills due to the dif-
ferential in the cost of raw cotton between domestic and foreign mills from
the date of enactment until the bill expires on July 31, 1967.
In other words, the Cooley Bill designed to return the American cotton in-
dustry to a one-price program was amended to create a three-price program
since the Secretary has already made it clear that he would fix the PIK pay-
ment rate approximately three cents less than the export subsidy rate. Should
this unlimited discretionary authority remain in the bill and be enacted into
Law, we would-have: (1) a basic loan rate substantially higher than the world
-rice of cotton which would determine the American farm price for cotton,
;2) a domestic mill price and (3) an export price. It should be clear to
everyone that under such a program the inequity being suffered by our domestic
.ills would not be' eliminated and that they would be forced to continue to
convert to the.use of man-made fibers as rapidly as possible. Such conversion
would be limited only by the ability of the manufacturers of man-made fibers
co increase their production. It should also be clear that our domestic mills
would not be able to compete in foreign textile markets until they are able
to buy American cotton at the same price paid by their foreign competitors.
Our domestic mills would not know from day to day how much more they would be
required to pay for cotton than their foreign competitors and, therefore,
would be unable to stock normal supplies, which would result in the Commodity
Credit Corporation continuing to carry the bulk of all available cotton.
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New York Cotton Exchange. [New York Cotton Exchange Circular No. 56, December 6, 1963], letter, December 6, 1963; (https://texashistory.unt.edu/ark:/67531/metapth1300752/m1/2/: accessed July 17, 2024), University of North Texas Libraries, The Portal to Texas History, https://texashistory.unt.edu; crediting Rosenberg Library.