“This is not something we can support at all. Quite frankly, I don’t know how many more licks we can take and still continue to get up,” says Bill Kennedy, chairman of Delta Council’s Cotton Ginning and Quality Improvement Committee, and manager of Duncan Gin in Inverness, Miss.
“One Delta gin ran their numbers and discovered these penalties would have cost them $92,000 in 2001.”
Chip Morgan, executive director of the Delta Council announced the group’s effort to find an amicable solution, or compromise, with the cotton exchanges at an Aug. 20 committee meeting in Stoneville.
“I don’t see a way around this, so we’d be well advised in getting together to come up with something we can live with. I’m hopeful we can change this and make it more lenient with greater thresholds. However, neither the Memphis or Greenwood cotton exchanges have returned my calls,” Morgan told committee members.
Kennedy believes this apparent lack of communication on the issue makes it clear the cotton exchanges are well aware of growers’ and ginners’ feelings about the Rule 19 changes.
The revision to the cotton exchanges’ Rule 19 could result in ginners and cotton growers being hit with penalties of $3 to $20 per bale, or even having bales rejected, if they weigh less than 410 pounds. Under the new rule, cotton bales weighing between 440 and 474 pounds net are penalized $3 per bale, and those weighing between 410 and 440 pounds garner a $6 penalty.
Those bales weighing less than 410 pounds can either be rejected outright, or if accepted, penalized $20 per bale. In addition, bales weighing more than 600 pounds net may be rejected.
“I’m not sure how we can stay out of that penalty range, even most of the time,” Kennedy says. “The larger capacity gins will have the most difficult time avoiding these penalties for underweight bales.”
“The higher rate of ginning per hour, the less control you have maintaining that bale weight within a set, narrow parameter," he says. "One additional charge on the tramper can mean a plus or minus 30 pounds per bale. On the other hand, you can’t stay in business if you slow down.”
An exception to these penalties is made where any invoice averages 490 pounds or more, in which case there will be no penalty. And while the penalties went into effect Aug. 1, 2002, they also apply to that portion of the 2001 crop that was warehoused, but not yet invoiced.
According to Stanley Anthony, director of the USDA Ginning Laboratory at Stoneville, Miss., the weight of an ‘official’ bale is 480 pounds, not 500 pounds, as many in the industry perceive. Achieving a perfect 480-pound bale of cotton is complicated by variations in variety, moisture content, trash content, growth conditions in the field and gin machinery condition.
It generally takes about 1,500 pounds of seed cotton to make one 480-500 pound bale of ginned cotton. However, Kennedy says, “We are dealing with a product that is inconsistent. Just because you have 1,500 pounds of seed cotton doesn’t mean you’re going to have 500 pounds of lint. It’s hard to be exact with a non-uniform product.”
“As ginners, we would love to set-up our gins to produce 480- to 490-pound bales of cotton at the beginning of the season, and then never have to change it during the season. The technology is not available, though, for us to stay within that tolerance in every instance,” he says.
What’s worse, Kennedy says the changes in penalties were a complete surprise to cotton growers and ginners. “Nobody has come to the industry and said we have a major problem with bale weights, and we need to do something about it. In fact, average bale weights per gin in the Mid-South haven’t changed in 20 years.”