USDA Allows Importation of 52,000 Tons of Upland Cotton
May 5, 2011 The U.S. Dept. of Agriculture has announced a 90-day period in which the country can import up to 52,000 tons of upland cotton. This limited global market quota runs from May 3 through July 31, and cotton must be physically imported within that timeframe.
The quota for upland cotton does not specify anything about staple length or country of origin, so any quantities imported will not be subject to the over-quota tariff rate of a tariff-rate quota.
The Agricultural Act of 1949, as amended, requires the President to establish a limited global import quota whenever the Secretary of Agriculture determines and announces that the average price of the base quality of upland cotton in the designated spot markets for a month exceeded 130 percent of the average price of such quality of cotton in such markets for the preceding 36 months.
In April 2011, the average spot market price for Strict Low Middling (SLM) 1-1/16 inch (leaf grade 4, micronaire 3.5-3.6 and 4.3-4.9, strength 24-25 grams/tex) upland cotton was 181.98 cents per pound, which is 242.8 percent of the April 2008 through March 2011 average price.
The 1949 Act also requires the amount of the limited global import quota to be equal to 21 days of domestic mill consumption of upland cotton at the seasonally-adjusted average rate of the most recent three months for which data are available. The quantity of upland cotton established by the limited global import quota is based on domestic mill consumption for the January 2011 through March 2011 period.
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