Ginners Marketplace

from Ginners Marketplace April 2023

Ginners Marketplace

If it were not for the support of producers and ginners in the Southeast Cotton Committee (SECC) political action committee, we would not be able to get the appointments we were able to have.

If you would like more information on how to participate in SECC, please contact Susan Garrick in our o ice.

Take A Hard Look At Insurance Costs And Safety Culture At The Gin

We would like to thank those that went on the trip and the members who were able to meet with us and especially the National Cotton Council Sta on helping to facilitate the trip.

Distractions have become “routine” in our daily lives. Our phones go o , we get text messages and we’re bombarded by the never-ending news cycle. Everything seems to be trying to get our attention, and it’s easy to lose sight of what’s important. Things can sneak up on you, and those are the ones that will jump up and bite you.

shut everything down in March 2020.

With this being a Farm Bill year, it was the main topic of conversation. While nearly every special interest in the country has a lobbyist in D.C., having actual constituents a ected by the laws they write has a much bigger impact than can be explained here.

In the last year or so, we’ve seen huge increases in our costs. As I write this, we’re getting news of the highest inflation in more than a generation… maybe two.

While I’m personally seeing some of the things that increased so much ease down a bit, it’s not common for costs that have gone up this much, this fast, to come down or come down very much. We will likely have to learn to live with some of them.

Being able to hear about the actual e ect of the cost of diesel or fertilizer prices from people back home leaves a serious impression.

The Cost Of Insurance

Another topic front of mind for many on the trip was the H-2A Program and the recent 14% increase in the AEWR. The Department of Labor released some changes in the program that will make it even more cumbersome and potentially more expensive than it already is. More details are forthcoming.

One of the costs that snuck up on many gins in the past year or so is the cost of insurance. Normally, this is a once-a-year expense we get hit with.

The past renewal cycle or two have been more than a bit of sticker shock for many in the ginning industry. Your associa-

One of the biggest highlights was to be able to visit with

Cotton’s Calendar

tions have been aware of this and have brought it to the attention of our memberships. But I think many of us got distracted by the other things going on and have now been hit with the reality that it’s not getting better.

 April 13-14: American Cotton Producers, Hyatt Regency DFW, Dallas, Texas

 April 14-15: Oklahoma Cotton Council’s Annual Denim Ball, Skirvin Hilton, Oklahoma City, Oklahoma

 April 19: PCCA Board & Delegate Body Meetings, Lubbock, Texas

This is a simplified explanation, but insurance companies are going to do what they need to in order to stay in business. They must make money like we do. The companies take our premium and invest it. They pay claims with it, and they expect to have some left over. If losses are low and return on investment is good, you have happy insurance companies. We get stable premiums and competition.

If they have poor investment returns and higher-than-expected cost of claims (read inflation), you have unhappy insurance companies. They may decide to pull out of the market and/or significantly increase rates. This is where we are today.

Your ginners associations and the National Cotton Ginners’ Association have been concerned about this for some time. We need healthy insurers and competition, but we really can only help one side of the insurance problem…losses. NCGA has put together a list of questions to ask yourself, so you can evaluate

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