What is in this article?:
- Textile trade war puts cotton growers in tough spot
- Definition of rule
- Greatest concern to growers
- Senate action
• The 15th round of the ongoing cotton talks in the Trans-Pacific Partnership trade agreement hearings ended this past fall with much the same results — Vietnam walking out on the negotiations.
• The two sides are bitterly divided between two basic marketing principles: The Single Transformation Rule and the Yarn Forward Rule.
ANDY WARLICK, left, president of Parkdale Mills in North Carolina, explains the Yarn Forward Rule to Alabama cotton farmer and ginner Mike Tate.
Greatest concern to growers
Perhaps of greatest concern to U.S. cotton growers in the noticeable absence of China in the TPP.
There is some concern that ratification of the agreement may further pit growing Asian economies, like Vietnam, in direct competition with China, which could force stricter economic trade policies that would hurt business relations with China, which is the largest buyer of U.S. cotton.
Warlick stressed to the more than 200 cotton growers, ginners and cotton industry leaders in the audience that 100 percent of the cotton used in U.S. textile mills is bought from U.S. cotton growers. We have been for a long time and remain your most loyal and dependable customers, he adds.
U.S. textile mills bought about 3.5 million bales of U.S. cotton last year. By comparison, China bought more than five million bales of U.S. grown cotton, or about 42 percent of all domestic cotton bought by foreign buyers.
Johnson notes the Yarn Forward Rule allows the U.S. textile industry to grow at a slower rate. Continuation of this rule, he says, expands high value textile manufacturing base, plus chemicals, fiber, recycled products and fiber investments. And, it continues to increase the amount of U.S. grown cotton bought by U.S. textile mills.
Indeed, the U.S. textile industry, which once dominated the rural enterprise of the Southeastern U.S., has made a bit of a recovery in recent years.
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U.S. textile output has been growing since 2009 after several years of decline. The value of shipments was $53 billion in 2011, a 4 percent increase over 2010, and total industry value is expected to climb once 2012 figures are added.
Unfortunately not all the businesses with a stake in U.S. cotton production are in support of the Yarn Forward Rule.
Last spring, two letters were sent to U.S. Trade Representative (USTR) Ambassador Ron Kirk. One letter was sent from a bipartisan group of House members and one from a bipartisan group of Senators to President Barack Obama, urging opposing positions on the rule.
In the House, 76 congressmen, led by Trey Gowdy, (R-S.C.), and Larry Kissell, (D-N.C.), and including 35 Republicans and 41 Democrats, sent a letter to Ambassador Kirk urging that strong textile rules be included in the TPP agreement in order to "stimulate private investment, exports and job growth within free trade partnering countries, including the United States.