United States Cotton Futures Act Amendments

Floor Speech

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Mr. AUSTIN SCOTT of Georgia. Mr. Speaker, I yield myself such time as
I may consume.

As my colleague said, Mr. Speaker, every year, cotton farmers prepare
their fields. Off the field they must prepare as well, hedging risk and
protecting themselves from possible disaster with cotton futures
contracts on U.S. commodity exchanges.

The Cotton Number 2 contract, which is a U.S.-regulated contract, is
the benchmark contract for the entire United States cotton industry.
However, recently, a wide range of cotton industry participants have
recommended the development of a world cotton contract with delivery
points inside and outside of the United States. This is in recognition
of the global nature of today's cotton industry.

The 1916 Cotton Futures Act requires that all cotton futures
contracts that are listed on the U.S. exchange must be classed by the
USDA, regardless of where the cotton is being stored. This structure is
outdated and does not recognize the global cotton trade that exists
today.

H.R. 5810 would simply allow for cotton futures contracts to be
offered on a U.S. exchange that is based off of the world market price.
This bill would neither change the regulation of the current futures
contracts nor the current USDA classing, which requires U.S. cotton be
classed again by USDA personnel.

With these technical changes in H.R. 5810, a new cotton futures
contract will be available in U.S. commodity markets.

I urge my colleagues to support H.R. 5810. I yield back the balance
of my time.

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