Ginners and cotton growers could be hit with penalties of $3 to $20 per bale, or even have bales rejected, if they do not meet new bale weight requirements of the Memphis Cotton Exchange and Greenwood, Miss., Cotton Exchange.
The Southern Cotton Ginners Association, terming the action “disturbing,” has called on the exchanges to reverse their recent decision requiring an increase in bale weights in order to avoid penalties.
The revision to the exchanges' Rule 19 — which the SCGA says was implemented without a review period or input from other segments of the cotton industry as to its feasibility — became effective on all invoices after Aug. 1.
In a letter to the exchanges, Sledge Taylor, Como, Miss., ginner/producer and SCGA president, said it “will cause undue hardship for ginners and producers, who are currently facing enough economic pressures without this added burden.”
The Rule 19 changes provide that cotton bales weighing less than 474 pounds net must be penalized as follows:
- For each bale weighing less than 474 pounds, but not under 440 pounds, a $3 penalty.
- For each bale weighing less than 440 pounds, but not under 410 pounds, a $6 penalty.
- Bales weighing less than 410 pounds may be rejected — but if accepted, must be penalized $20 per bale.
- An exception to these penalties is made where any invoice averages 490 pounds or more, in which case there will be no penalty, but bales weighing less than 410 pounds may be rejected.
- Bales weighing more than 600 pounds net may be rejected.
In addition to the financial considerations, the Rule 19 changes would have other adverse impacts, the SCGA letter noted.
“To increase the bale weight is just not as simple as making a few adjustments to the bale press,” Taylor noted. Some of the problems the new weight requirements would cause:
- In modern high-capacity gins, it is more difficult to adjust relatively small increments of weight to the bale at the press. If a gin with bales averaging 488 pounds were to increase bale size to avoid penalties, they would be faced with many bales around 538 pounds because another complete tramper stroke would have to be added and high-speed gins commonly charge the press with as much as 50 pounds per stroke “Many presses cannot press a bale that size, especially if the cotton is dry,” Taylor pointed out. “The gin will obviously be unable to comply.”
- Additional required pressure at the press will cause increased wear in ginning equipment, and some presses may be unable to handle the pressure required.
- Higher ginning costs as a result of the increased power requirements to pack a heavier bale.
- In some instances, a variance of several pounds in bale weight is due to moisture content (or lack thereof), and other cotton quality factors not fully controllable at the gin.
- Increased pressure on the bale ties will result in more tie failures and potential injury to workers.
- The effective date of the rule change affects last year's crop, and at the time those bales were ginned there was no knowledge of the impending changes in the rules.
“Bale size is very much a factor of the working pressure at the press and the moisture content of the cotton,” Taylor noted. “I'm not sure Rule 19 will have the intended effect of increasing average bale weights, since that is related to the science of physics and not some arbitrary rule.”
A review of gin bale weights from 1994 to 2001 shows that the trend for the nation as a whole was flat, Taylor says.
In the Mid-South, “They have been remarkably constant over the eight-year period. Missouri weights have trended up, but they started a bit lower than other states. Tennessee and Louisiana trended up slightly over the period, while Arkansas and Mississippi trended down.
“My conclusion is that there is no trend toward lower bale weights that would cause the merchants to have a legitimate concern for encouraging higher weights.”
In Arkansas for 2001, the average bale weight was 488 pounds; in Louisiana 489 pounds; in Mississippi 488.1 pounds; in Missouri 489 pounds; and in Tennessee 491.6 pounds.
Nationally, over the eight-years, bale weights averaged 491.6 pounds on the low side and 493.4 pounds on the high side.
Taylor said he had discussed the matter with some merchants “who seem convinced that bale weights are getting smaller and that Missouri and Louisiana weights are trending much lower, but the data do not support that theory — in fact, bale weights are holding constant.”
He pointed out that the National Cotton Council's policy on bale weight penalties sets a threshold for penalties to start at 485 pounds, not 490 pounds as implemented by Rule 19.
“Southern Cotton Ginners Association members want to do everything possible to add value to our product and to make our cotton bales competitive in the world market,” Taylor said. “Gins strive to provide a consistent bale package, and I think the data from the last eight years support that.
“There is no trend toward lower bale weights in this country, and we wonder why this has become such an issue without anyone contacting the ginners association to determine how feasible it is to adjust small increments of bale weight.”
Gins try to make as large a bale as they can within the practical physical limitations of their presses, Taylor noted. “Some will be able to make relatively small adjustments, but bale weights increase as a function of weight of cotton per stroke of the tramper, and that tends to be in the 30-pound to 50-pound range for many gins. Increases of that amount over the current bale size would push many gin presses beyond the capacity of their hydraulic systems.”
Taylor said ginners “want to do everything possible to cooperate with all segments of our industry in order to provide a quality product. But we also have a responsibility to protect our producers from fees that are unfair. We would welcome any type of dialogue on this issue, with any segment of the industry.”
But, producers and ginners have been experiencing “one of the most trying times in the cotton economy,” he said, “and for the good of the industry, now is not the time to increase the penalty burden.
“On behalf of our affiliate associations in Arkansas, Mississippi, Louisiana, Missouri, and Tennessee, we ask that the Memphis and Greenwood Cotton Exchanges reverse these changes to Rule 19.”
e-mail: [email protected] .