American Cotton Shippers Association has proposed that the US cotton industry devise a replacement for Commodity Credit Corp. (CCC) non-recourse loan program.
As a result of cheaper prices, the CCC has become the chief market, restricting more quantity of cotton supply in trading centers.
Many cotton dealers are now forced to look at other sources, like Australia, Uzbekistan and Africa, to fulfill their export contracts.
Meanwhile, the CCC policy will hold significant amount of excess cotton that, in time, will be unfairly sold against next year's yield.
The new loan policy should be such that allows more cotton into markets.
Association does not have any particular plan but believes that any scheme that protects the interests of the US cotton traders will be welcome.
Manfred Schiefer, President, stressed, “We are prepared to make our case to the Congress and the administration, and, hopefully, we can do so as a united industry. Simply put, there is no support for a program that produces cotton at record levels and then locks it up in the CCC loan. The program is flawed and it must be fixed.”
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