The question Sam Spruell heard in Guatemala translates the same in English as it does in Spanish: What’s your position on the Central American Free Trade Agreement?
The president of the Southern Cotton Growers traveled to Guatemala with two other Southeastern growers to learn what manufacturers in the Central American country wanted and needed in the way of U.S. cotton. (The vast majority of cotton used in cut and sew operations in Guatemala comes from the Southeastern United States.)
His hosts, however, were more interested in his position on CAFTA, expressing optimism that the agreement would open up additional access to U.S. markets. Having yet to develop an official position, Spruell found himself in a quandary as to the answer, but led him to think about the future.
In exploring what the future holds for Southern cotton growers in light of the decline in the domestic textile industry, Spruell knows the group is going to be asked to take a position. In answering the question, he says, “we don’t know exactly what we need to do. Some domestic mills are in favor of it and some are against it.”
The National Cotton Council just recently went on record in opposition to CAFTA and urged Congress to thoroughly review and significantly improve the agreement’s textile provisions.
The American Textile Manufacturers Institute opposes CAFTA.
CAFTA, which President Bush signed on May 28, has farm and industry organizations lined up on opposite sides.
In traveling to Guatemala, “our objective was to explore what our customer wanted,” Spruell says of the “sourcing summit” he, Mike Tate, a Hazel Green, Ala., producer and Jimmy Webb, a Leary, Ga., producer attended.
Most of the domestic U.S. textile manufacturers on the trip had already established or were contemplating joint ventures in the Central American country and were in favor of CAFTA. The group met with local manufacturers who were excited about the opportunity CAFTA presents.
Outside his official capacity as president of the Southern Cotton Growers, Spruell’s position on CAFTA is as hard to pin down as catching a minnow with a teaspoon in the Tennessee River. “I could fire off and say exactly what I think, but as a leader I know that we’re going to have to develop a position that we’re comfortable with.”
Spruell believes the Southern Cotton Growers’ position could reflect the one developed at the American Cotton Producers annual meeting in August. CAFTA will also figure prominently in discussions at Southern’s summer meeting in Washington, D.C.
While acknowledging a need “ to protect our domestic industry,” Spruell sees a need to negotiate treaties that won’t cost U.S. jobs or allow other countries to take over the U.S. textile industry.
“If we’re going to negotiate trade agreements that allow those things to happen — take U.S. jobs and take over our domestic textile industry and create a situation where our domestic manufacturers need to move — then we need, in my opinion, trade agreements with regions of the world that are closest to the U.S. production sector and with regions of the world where we can enhance our sales to that region,” Spruell said in a telephone interview.
“The next closest place for a trade agreement (in terms of geography) is Central America,” Spruell says. “It’s better to have an agreement with Central America, a place that uses our cotton … than it would be to have it cut and sewn in China and shipped to the U.S.”
Spruell kept hearing comments about the quality of U.S. cotton in Guatemala. “We had people who are buying our raw cotton tell us more than once not to be concerned about Brazilian cotton or cotton from other countries because our quality is head and shoulders above the rest of the world.
“While they tell us that, we don’t want to be complacent about quality,” Spruell says.
He returned much more concerned about the domestic textile industry’s lack of understanding of the U.S. production sector than about whether there would be a market for U.S. cotton in Central America in the future.
“The domestic textile industry appeared to have little working knowledge about the production side of the cotton industry in the U.S.,” Spruell says. “They were interested in price and availability and quality. That helped us better understand why we have discounts in some years.”