A shrinking reserve fund for USDA's Cotton Classing Division will require an increase in classing fees for the 2004-05 season.
The fee will increase to $1.65, up 20 cents from last season, according to Larry Creed, director of the Dumas, Ark., classing office that serves part of the Mid-South region.
“Over the years, we've been required to retain a system reserve to cover unexpected costs and shortfalls in the classing operations,” he told the Delta Council's Ginning and Cotton Quality Improvement Committee in a joint meeting with members of the Southern Cotton Ginners Association at Stoneville, Miss.
“In 1993, it cost us $1.97 to class a sample, but we were charging only $1.92. Every year for the last 11 years, the classing operation has lost money, and we're now to the point that our administrator in Washington, Norma McDill, has directed that we increase the classing fee in order to help restore the system reserve.”
The past decade has seen a number of changes in the classing system to achieve cost efficiencies, Creed says.
“During the period, we've consolidated operations and the 18 classing offices have shrunk to 12. We've gone from 103 full-time employees to 75, and travel and supplies budgets have been cut.
“At the same time, operational costs have continued to escalate. For example, costs for hauling samples from gins to classing offices have gone from $827,690 in 1993 to $1,625,900 in 2003, much of that due to higher fuel costs. Our high volume instrument (HVI) classing equipment costs have increased 70 percent since 1997. Personnel and leased space costs have also gone up, while interest earnings on our funds have gone down.”
The classing office, formerly located in Greenwood, Miss., relocated to Dumas, Ark., in 1994, Creed notes.
“Our 10-year lease on the Dumas office has just ended, and we've signed a new one for five more years. We're getting new classing equipment and new conveyor systems, both of which are very expensive. Our systems are coming on line today, and we've got technicians coming in next week to tweak all the equipment and be sure it's fully operational for the coming classing season.”
USDA's classing system, Creed says, is “the best in the world, and we will continue making the investments necessary to improve the system to meet the needs of growers and the industry — but we'll also continue striving to keep prices as low as possible.”
Twelve cotton classing offices, located in nine states, make up the Grading Branch of USDA's Agricultural Marketing Service.
In addition to the Dumas facility, classing offices are at Memphis, Tenn.; Rayville, La.; Phoenix, Ariz.; Abilene, Texas; Birmingham, Ala.; Corpus Christi, Texas; Florence, S.C.; Lamesa, Texas; Visalia, Calif.; and Lubbock, Texas.
Classification of samples is based on official standards. Leaf grade, preparation, and extraneous matter determinations are made by cotton classers. All other fiber properties of both Upland and American Pima cotton are determined by HVI systems, which currently measure for fiber length, length uniformity, strength, micronaire, color, and trash.
Fiber property measurements made by HVI and grades assigned by classers for each sample are stored automatically in the computer as soon as classification is completed. Classification data are then available via telecommunications to the authorized recipient's computer. Data may also be delivered to the grower or his designated agent by tapes or diskettes.