 NEWS
Farm Service Agency
Public Affairs Staff
1400 Independence Ave SW
Stop 0506, Room 3624-South
Washington, D.C. 20250-0506
Release No. 1401.04
Program Announcement
Stevin Westcott (202) 720-4178
stevin_westcott@wdc.usda.gov
USDA ANNOUNCES PREVAILING WORLD MARKET PRICE, LOAN
DEFICIENCY PAYMENT RATE, AND USER MARKETING CERTIFICATE
PAYMENT RATE FOR UPLAND COTTON
WASHINGTON, Jan. 2, 2004 -- The Department of
Agriculture's Commodity Credit Corporation today announced
the prevailing world market price, adjusted to U.S. quality
and location (adjusted world price or AWP), for Strict Low
Middling (SLM) 1-1/16 inch (leaf grade 4, micronaire 3.5-3.6
and 4.3-4.9, strength 25.5-29.4 grams per tex, length
uniformity of 80-82 percent) upland cotton (base quality),
the coarse count adjustment (CCA), the loan deficiency
payment rate, and the user marketing certificate (Step 2)
payment rate that will be in effect from 12:01 a.m., Eastern
time, Friday, Jan. 2, 2004, through midnight, Eastern time,
Thursday, Jan. 8, 2004.
Cents/lb.
Adjusted World Price (AWP) ................ 61.29
Coarse Count Adjustment (CCA) ............. 0.00
Loan Deficiency Payment Rate .............. 0.00
User Marketing Cert. Rate (Step 2)......... 2.00
This week's AWP and CCA are determined as follows:
NE Price .............................. 74.67
Adjustments:
Avg. U.S. spot market location ... -10.17
SLM 1-1/16 inch cotton ............ -3.25
Avg. U.S. location ................ 0.04
Sum of Adjustments ....................... -13.38
ADJUSTED WORLD PRICE ..................... 61.29
NE Price ................................. 74.67
NE Coarse Count Price .................... -72.72
Adjustment to SLM 1-1/32 inch cotton ..... -5.45
COARSE COUNT ADJUSTMENT (Cannot be less than zero) 0.00
The Farm Security and Rural Investment Act of 2002
provides that the AWP may be further adjusted if: 1) the AWP
is less than 115 percent of the current crop year loan rate
for base quality upland cotton, and 2) the USNE price
exceeds the NE price. Because this week's calculated AWP
exceeds 115 percent of the 2003 upland cotton base quality
loan rate, a further adjustment cannot be made.
Because the AWP for the period exceeds 52.00 cents per
pound, which is the base quality loan rate, the loan
repayment rate during this period is equal to the loan rate,
adjusted for the specific quality and location plus
applicable interest and storage charges.
Step 2 payments are provided this week because, for four
consecutive weeks, the USNE has exceeded the NE price and
the AWP has not exceeded 134 percent of the loan rate for
upland cotton. Relevant data for the Step 2 program follow:
AWP as %
Fri/Thur of 2003 USNE
Period Base Loan USNE NE Less Step 2 Dates
Week Ending Rate Price Price NE Price Rate Applicable
.......... cents/lb ...........
1 12/11/03 114.8 73.45 73.07 0.38 0.38 (12/12-12/18)
2 12/18/03 114.3 73.45 72.84 0.61 0.61 (12/19-12/25)
3 12/25/03 115.4 73.88 73.39 0.49 0.49 (12/26-01/01)
4 01/01/04 117.9 76.67 74.67 2.00 2.00 (01/02-01/08)
NOTE: The next announcement of the AWP, CCA, LDP rate,
and user marketing certificate payment rate for upland
cotton will be on Thursday, Jan. 8, 2004, at 5 p.m., Eastern
time.
Further program information is available from Scott
Sanford, (202) 720-3392, e-mail scott_sanford@wdc.usda.gov.
#
NOTE: Farm Service Agency (FSA) news releases and media
advisories are available on the World Wide Web at FSA's home
page: http://www.fsa.usda.gov.
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