February 4, 2000

Another round of indemnity payments, amount unknown at press time, will be coming—probably sometime in March.

The Livestock Assistance Program will also funnel $200 million to producers who suffered grazing losses due to natural disasters during Calendar Year 1999.

Last year’s AMTA payments not deferrable

Last year’s supplemental AMTA payments (emergency income assistance payments) are not tax deferrable.

Unless Congress makes a change in the law, the supplemental payments must be declared as income on your 1999 tax return. Although the IRS Code refers to destruction, damage to crops, or being unable to plant, the supplemental payments in this case are more a revenue issue.

Some crop insurance payments are deferrable. Tax issues become complicated when insurance payments include both a portion for the lost crop and low prices. While the portion that is paid for the destruction or damage to crops could be deferred under the regular deferral of crop insurance rules, the portion that is paid because of low prices would not be deferrable.

Polyester making inroads on cotton’s textile share

Cotton is taking a back seat to non-cellulose fibers, namely polyester. After dominating the textile world for many years, King Cotton finally gave up its rein to polyester in 1995.

From 1985 to 1998, total world fiber production increased 30 percent. In that period, cotton production increased 5 percent, while non-cellulose fibers increased 82 percent. Until 1991, cotton held a larger share of world fiber production than all man-made fibers combined. Since 1995, cotton has slipped to number two, falling behind polyester and other non-cellulose fibers.

Cotton consumption is also second to man-made fibers in the United States. Although cotton’s share of fiber consumption has held up well at 37 to 40 percent since the early 1990s, an increasing share of U.S. cotton consumption at the consumer level is coming from increased imports of cotton fabrics and apparel.