Cotton Growers Take on Cargill
It’s a complicated complaint if you don’t follow commodities, but here’s the gist. For decades, farmers in the Autauga Quality Cotton Association have dealt with the commodities arm of Cargill, letting the power player hedge prices to help them get the most for their acres of white.
Last year, AQCA says, Cargill left farmers hanging — manipulating the prices higher, then pulling out its protective tactics and letting the cotton prices fall from $2.15 a pound in March to 77 cents a pound on payday. That’s almost a dime a pound less than the cost of raising cotton, farmers say, with association members losing some $35 million.
So their association has taken its complaint to the Memphis Cotton Exchange for arbitration. It’s supposed to be confidential, said AQCA Manager Jeff Thompson, but the Wall Street Journal got wind of the complaint and filed a lengthy and accurate story, he said.
“We believe in the arbitration process and we will see it through,” said Thompson, adding that in the meantime, “We don’t want to talk about it.”
Cargill has responded to the association’s complaint, Thompson said, and he expects a hearing date to be set soon with a decision next year.
Founded in 1967 in Prattville, Autauga Quality Cotton Association now has 700 members, nearly half of them in Texas, because “that’s where cotton is growing,” said Thompson. Alabama and Georgia are the other big producers, he said, but the membership includes cotton farmers in 10 states.