Cotton pickin' good .....

The US department of Agriculture issued a notice on January 20th 2006, to the cotton trade, including all warehouse operators approved under the Cotton Storage Agreement, regarding temporary storage space in outside yards for the 2005-Crop of Upland Cotton in certain counties in West Texas, Oklahoma, Kansas, and New Mexico.

Why ?

Because there is too much of the stuff to fit in the warehouses.

Yet as poor nations press the World Trade Organization (WTO) to stop unfair US farm subsidies, U.S. cotton producers intend to plant 14.44 million acres of cotton this spring, up 1.7 % from 2005, according to the National Cotton Council’s 23rd Annual Early Season Planting Intentions Survey.

The US government spends US$4.5 billion annually in subsidies on a cotton crop with a market price of $5.9 billion, which otherwise would have to be priced more than double in the world market. This subsidy enables US growers to export profitably three-quarters of their output and control 40% of world trade in cotton.

What the US lost in textile yarn, fabric and clothing manufacturing, it gains back in subsidized cotton export, high returns on investment in overseas textile mills and low consumer prices in cotton goods = a low Consumer price Index, US / CPI is down 69% for clothing in last 10 years.

So the current "tariff war" against Chinese textiles is merely the US wanting its cake and eating it too. USD$4.5 billion is a mere pittance in the USD $2.4 trillion 2005 US fiscal budget, the subsidy effectively simply ruins the economies of the world's poorest nations and maintains US dominance.

The National Cotton Council, a powerful trade group in US domestic politics, while basking in the happy situation of seeing US cotton exports increase by 350% between 1999 and 2004, from 4 million 480-pound (218-kilogram) bales to 14 million bales, explains that the goal of helping African growers is "not to make Africa a big cotton producer", only to make the lives of the poor fucking Africans "a little better".

It is simply a strategy of protecting managed trade with welfare trade. Simply doubling the market price of cotton will not help African growers, whose competitive disadvantages go beyond market price, and cannot be eliminated without fundamental changes in the terms of global agricultural trade.

Those cotton states are mighty important in the upcoming mid-term elections too.