§ 7236. — Special marketing loan provisions for upland cotton.
[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
January 24, 2002 and December 19, 2002]
[CITE: 7USC7236]
TITLE 7--AGRICULTURE
CHAPTER 100--AGRICULTURAL MARKET TRANSITION
SUBCHAPTER III--NONRECOURSE MARKETING ASSISTANCE LOANS AND LOAN
DEFICIENCY PAYMENTS
Sec. 7236. Special marketing loan provisions for upland cotton
(a) Cotton user marketing certificates
(1) Issuance
During the period ending July 31, 2003, the Secretary shall
issue marketing certificates or cash payments, at the option of the
recipient, to domestic users and exporters for documented purchases
by domestic users and sales for export by exporters made in the week
following a consecutive 4-week period in which--
(A) the Friday through Thursday average price quotation for
the lowest-priced United States growth, as quoted for Middling
(M) 1\3/32\-inch cotton, delivered C.I.F. Northern Europe
exceeds the Northern Europe price by more than 1.25 cents per
pound; and
(B) the prevailing world market price for upland cotton
(adjusted to United States quality and location) does not exceed
134 percent of the loan rate for upland cotton established under
section 7232 of this title.
(2) Value of certificates or payments
The value of the marketing certificates or cash payments shall
be based on the amount of the difference (reduced by 1.25 cents per
pound) in the prices during the 4th week of the consecutive 4-week
period multiplied by the quantity of upland cotton included in the
documented sales.
(3) Administration of marketing certificates
(A) Redemption, marketing, or exchange
The Secretary shall establish procedures for redeeming
marketing certificates for cash or marketing or exchange of the
certificates for agricultural commodities owned by the Commodity
Credit Corporation or pledged to the Commodity Credit
Corporation as collateral for a loan in such manner, and at such
price levels, as the Secretary determines will best effectuate
the purposes of cotton user marketing certificates, including
enhancing the competitiveness and marketability of United States
cotton. Any price restrictions that would otherwise apply to the
disposition of agricultural commodities by the Commodity Credit
Corporation shall not apply to the redemption of certificates
under this subsection.
(B) Designation of commodities and products
To the extent practicable, the Secretary shall permit owners
of certificates to designate the commodities and products,
including storage sites, the owners would prefer to receive in
exchange for certificates.
(C) Transfers
Marketing certificates issued to domestic users and
exporters of upland cotton may be transferred to other persons
in accordance with regulations issued by the Secretary.
(b) Special import quota
(1) Establishment
(A) In general
The President shall carry out an import quota program during
the period ending July 31, 2003, as provided in this subsection.
(B) Program requirements
Except as provided in subparagraph (C), whenever the
Secretary determines and announces that for any consecutive 4-
week period, the Friday through Thursday average price quotation
for the lowest-priced United States growth, as quoted for
Middling (M) 1\3/32\-inch cotton, delivered C.I.F. Northern
Europe, adjusted for the value of any certificate issued under
subsection (a) of this section, exceeds the Northern Europe
price by more than 1.25 cents per pound, there shall immediately
be in effect a special import quota.
(C) Tight domestic supply
During any month for which the Secretary estimates the
season-ending United States upland cotton stocks-to-use ratio,
as determined under subparagraph (D), to be below 16 percent,
the Secretary, in making the determination under subparagraph
(B), shall not adjust the Friday through Thursday average price
quotation for the lowest-priced United States growth, as quoted
for Middling (M) 1\3/32\-inch cotton, delivered C.I.F. Northern
Europe, for the value of any certificates issued under
subsection (a) of this section.
(D) Season-ending United States stocks-to-use ratio
For the purposes of making estimates under subparagraph (C),
the Secretary shall, on a monthly basis, estimate and report the
season-ending United States upland cotton stocks-to-use ratio,
excluding projected raw cotton imports but including the
quantity of raw cotton that has been imported into the United
States during the marketing year.
(2) Quantity
The quota shall be equal to 1 week's consumption of upland
cotton by domestic mills at the seasonally adjusted average rate of
the most recent 3 months for which data are available.
(3) Application
The quota shall apply to upland cotton purchased not later than
90 days after the date of the Secretary's announcement under
paragraph (1) and entered into the United States not later than 180
days after the date.
(4) Overlap
A special quota period may be established that overlaps any
existing quota period if required by paragraph (1), except that a
special quota period may not be established under this subsection if
a quota period has been established under subsection (c) of this
section.
(5) Preferential tariff treatment
The quantity under a special import quota shall be considered to
be an in-quota quantity for purposes of--
(A) section 2703(d) of title 19;
(B) section 3203 of title 19;
(C) section 2463(d) of title 19; and
(D) General Note 3(a)(iv) to the Harmonized Tariff Schedule.
(6) ``Special import quota'' defined
In this subsection, the term ``special import quota'' means a
quantity of imports that is not subject to the over-quota tariff
rate of a tariff-rate quota.
(7) Limitation
The quantity of cotton entered into the United States during any
marketing year under the special import quota established under this
subsection may not exceed the equivalent of 5 week's consumption of
upland cotton by domestic mills at the seasonally adjusted average
rate of the 3 months immediately preceding the first special import
quota established in any marketing year.
(c) Limited global import quota for upland cotton
(1) In general
The President shall carry out an import quota program that
provides that whenever the Secretary determines and announces that
the average price of the base quality of upland cotton, as
determined by the Secretary, in the designated spot markets for a
month exceeded 130 percent of the average price of such quality of
cotton in the markets for the preceding 36 months, notwithstanding
any other provision of law, there shall immediately be in effect a
limited global import quota subject to the following conditions:
(A) Quantity
The quantity of the quota shall be equal to 21 days of
domestic mill consumption of upland cotton at the seasonally
adjusted average rate of the most recent 3 months for which data
are available.
(B) Quantity if prior quota
If a quota has been established under this subsection during
the preceding 12 months, the quantity of the quota next
established under this subsection shall be the smaller of 21
days of domestic mill consumption calculated under subparagraph
(A) or the quantity required to increase the supply to 130
percent of the demand.
(C) Preferential tariff treatment
The quantity under a limited global import quota shall be
considered to be an in-quota quantity for purposes of--
(i) section 2703(d) of title 19;
(ii) section 3203 of title 19;
(iii) section 2463(d) of title 19; and
(iv) General Note 3(a)(iv) to the Harmonized Tariff
Schedule.
(D) Definitions
In this subsection:
(i) Supply
The term ``supply'' means, using the latest official
data of the Bureau of the Census, the Department of
Agriculture, and the Department of the Treasury--
(I) the carry-over of upland cotton at the beginning
of the marketing year (adjusted to 480-pound bales) in
which the quota is established;
(II) production of the current crop; and
(III) imports to the latest date available during
the marketing year.
(ii) Demand
The term ``demand'' means--
(I) the average seasonally adjusted annual rate of
domestic mill consumption during the most recent 3
months for which data are available; and
(II) the larger of--
(aa) average exports of upland cotton during the
preceding 6 marketing years; or
(bb) cumulative exports of upland cotton plus
outstanding export sales for the marketing year in
which the quota is established.
(iii) Limited global import quota
The term ``limited global import quota'' means a
quantity of imports that is not subject to the over-quota
tariff rate of a tariff-rate quota.
(E) Quota entry period
When a quota is established under this subsection, cotton
may be entered under the quota during the 90-day period
beginning on the date the quota is established by the Secretary.
(2) No overlap
Notwithstanding paragraph (1), a quota period may not be
established that overlaps an existing quota period or a special
quota period established under subsection (b) of this section.
(Pub. L. 104-127, title I, Sec. 136, Apr. 4, 1996, 110 Stat. 909; Pub.
L. 105-86, title VII, Sec. 731, Nov. 18, 1997, 111 Stat. 2108; Pub. L.
105-277, div. A, Sec. 101(a) [title VII, Sec. 762], Oct. 21, 1998, 112
Stat. 2681, 2681-36; Pub. L. 106-78, title VIII, Sec. 806, Oct. 22,
1999, 113 Stat. 1179.)
References in Text
The Harmonized Tariff Schedule, referred to in subsecs. (b)(5)(D)
and (c)(1)(C)(iv), is not set out in the Code. See Publication of
Harmonized Tariff Schedule note set out under section 1202 of Title 19,
Customs Duties.
Amendments
1999--Subsec. (a)(1). Pub. L. 106-78, Sec. 806(a)(1), substituted
``or cash payments, at the option of the recipient,'' for ``or cash
payments'' in introductory provisions.
Subsec. (a)(1)(A), (2). Pub. L. 106-78, Sec. 806(a)(2), substituted
``1.25 cents per pound'' for ``3 cents per pound''.
Subsec. (a)(3)(A). Pub. L. 106-78, Sec. 806(a)(3)(A), substituted
``owned by the Commodity Credit Corporation or pledged to the Commodity
Credit Corporation as collateral for a loan in such manner, and at such
price levels, as the Secretary determines will best effectuate the
purposes of cotton user marketing certificates, including enhancing the
competitiveness and marketability of United States cotton'' for ``owned
by the Commodity Credit Corporation in such manner, and at such price
levels, as the Secretary determines will best effectuate the purposes of
cotton user marketing certificates'' in first sentence.
Subsec. (a)(3)(B). Pub. L. 106-78, Sec. 806(a)(3)(B), struck out at
end ``If any certificate is not presented for redemption, marketing, or
exchange within a reasonable number of days after the issuance of the
certificate (as determined by the Secretary), reasonable costs of
storage and other carrying charges, as determined by the Secretary,
shall be deducted from the value of the certificate for the period
beginning after the reasonable number of days and ending with the date
of the presentation of the certificate to the Commodity Credit
Corporation.''
Subsec. (a)(4). Pub. L. 106-78, Sec. 806(a)(4), struck out heading
and text of par. (4). Text read as follows: ``Total expenditures under
this subsection shall not exceed $701,000,000 during fiscal years 1996
through 2002.''
Subsec. (b)(1). Pub. L. 106-78, Sec. 806(b)(1), added par. (1) and
struck out heading and text of former par. (1). Text read as follows:
``The President shall carry out an import quota program that provides
that, during the period ending July 31, 2003, whenever the Secretary
determines and announces that for any consecutive 10-week period, the
Friday through Thursday average price quotation for the lowest-priced
United States growth, as quoted for Middling (M) 1\3/32\-inch cotton,
delivered C.I.F. Northern Europe, adjusted for the value of any
certificates issued under subsection (a) of this section, exceeds the
Northern Europe price by more than 3 cents per pound, there shall
immediately be in effect a special import quota.''
Subsec. (b)(7). Pub. L. 106-78, Sec. 806(b)(2), added par. (7).
1998--Subsecs. (a)(1)(A), (2), (b)(1). Pub. L. 105-277 substituted
``3 cents'' for ``1.25 cents''.
1997--Subsec. (a)(1). Pub. L. 105-86, Sec. 731(1), in introductory
provisions substituted ``During'' for ``Subject to paragraph (4),
during'' and in subpar. (B) substituted ``134'' for ``130''.
Subsec. (a)(4), (5). Pub. L. 105-86, Sec. 731(2), (3) redesignated
par. (5) as (4) and struck out heading and text of former par. (4). Text
read as follows: ``The Secretary shall not issue marketing certificates
or cash payments under paragraph (1) if, for the immediately preceding
consecutive 10-week period, the Friday through Thursday average price
quotation for the lowest priced United States growth, as quoted for
Middling (M) 1\3/32\-inch cotton, delivered C.I.F. Northern Europe,
adjusted for the value of any certificate issued under this subsection,
exceeds the Northern Europe price by more than 1.25 cents per pound.''
Effective Date of 1997 Amendment
Section 731 of Pub. L. 105-86 provided that the amendment made by
that section is effective Oct. 1, 1998.
Section Referred to in Other Sections
This section is referred to in section 7234 of this title.
