The Agricultural Marketing Service (AMS) is amending the Cotton Board Rules and Regulations, increasing the value assigned to imported cotton to calculate supplemental assessments.

The assessed value of imported cotton will rise from $0.011136 per kg to $0.013215 per kg, which is an increase of an increase of $0.002079 per kg. This reflects an increase in the weighted average price of Upland cotton received by U.S. farmers in 2021.

The rule will come into effect on Nov. 28, 2022.

The AMS said it believes that the adjustment is necessary to “ensure that assessments collected on imported cotton and the cotton content of imported products are the same as those paid on domestically produced cotton.”

In 2021, producer assessments totaled $40.1 million and importer assessments totaled $44.2 million. According to the Cotton Board, should the volume of cotton products imported into the U.S. remain at the same level in 2022, one could expect an increase of assessments by approximately $8,268,674.

Each year, Section 1205.510(b)(2) of the Cotton Board Rules and Regulations uses the 12-month weighted average price received by U.S. farmers for Upland cotton to represent the value of imported cotton. This is so that the assessment on domestically produced cotton and the assessment on imported cotton and the cotton content of imported products is the same.

The first part of the assessment is based on the weight of cotton imported—levied at a rate of $1 per bale of cotton, which is equivalent to 500 pounds, or $1 per 226.8 kilograms of cotton. The second part of the import assessment is based on the value of imported cotton lint or the cotton contained in imported cotton products—levied at a rate of five-tenths of one percent of the value of domestically produced cotton.

You can view the complete Final Register Rule here.

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