This commentary appeared in the print edition of the Jan. 6, 2020, Journal of Commerce Annual Review and Outlook.
Last year, the American Cotton ­Shippers ­Association (ACSA), the trade association that represents the majority of US and global cotton shipments, described the US cotton trade as anticipating increased demand from US–China relations normalization and the unprecedented need for supply chain capacity and efficiency to move increasing exports.
Without a trade resolution, these factors have compounded. US cotton stocks have increased by over 30 percent, cotton prices have dropped by 30 percent, and the United States has lost over 50 percent of its market share in China, traditionally the world’s largest cotton consumer.
The US has the world’s largest supply of exportable cotton and should be a strategic supplier to China. US cotton will only be able to restore demand, regain market share, and deliver these growing stocks by leveraging superior infrastructure and logistics capacity to create value for our product. These national objectives require comprehensive supply chain alignment and velocity, particularly in intermodal hubs like Memphis. The considerations of container and chassis availability and driver efficiency are critical “first-mile” requirements.
ACSA submitted public comments supporting the Federal Maritime Commission’s Interpretive Rule on Demurrage and Detention.
To achieve our global goals, it is imperative that our members have choice within the supply chain rather than the unique imposition of chassis “box rules” for US cotton exports. A practical first step is to implement the recommendations of FMC’s Memphis Supply Chain Innovation Team to create a single, interoperable gray chassis pool for merchant haulage. This recommendation has broad stakeholder support and has been recognized by Sen. Roger Wicker, R-Miss., Senate Commerce Committee chair, in writing to the FMC. This effort must be a national export priority for US agricultural competitiveness.