SPECIAL MARKETING LOAN PROVISIONS FOR UPLAND COTTON.

SEC. 136. SPECIAL MARKETING LOAN PROVISIONS FOR UPLAND COTTON. (a) Cotton User Marketing Certificates.— (1) Issuance.— Subject to paragraph (4), during the period ending July 31, 2003, the Secretary shall issue marketing certificates or cash payments to domestic users and exporters for documented purchases by domestic users and sales for 110 STAT. 910export by exporters made in the week following a consecutive 4-week period in which— (A) the Friday through Thursday average price quotation for the lowest-priced United States growth, as quoted for Middling (M) 1 3/32-inch cotton, delivered C.I.F. Northern Europe exceeds the Northern Europe price by more than 1.25 cents per pound; and (B) the prevailing world market price for upland cotton (adjusted to United States quality and location) does not exceed 130 percent of the loan rate for upland cotton established under section 132. (2) Value of certificates or payments.— The value of the marketing certificates or cash payments shall be based on the amount of the difference (reduced by 1.25 cents per pound) in the prices during the 4th week of the consecutive 4-week period multiplied by the quantity of upland cotton included in the documented sales. (3) Administration of marketing certificates.— (A) Redemption, marketing, or exchange.— The Secretary shall establish procedures for redeeming marketing certificates for cash or marketing or exchange of the certificates for agricultural commodities owned by the Commodity Credit Corporation in such manner, and at such price levels, as the Secretary determines will best effectuate the purposes of cotton user marketing certificates. Any price restrictions that would otherwise apply to the disposition of agricultural commodities by the Commodity Credit Corporation shall not apply to the redemption of certificates under this subsection. (B) Designation of commodities and products.— To the extent practicable, the Secretary shall permit owners of certificates to designate the commodities and products, including storage sites, the owners would prefer to receive in exchange for certificates. If any certificate is not presented for redemption, marketing, or exchange within a reasonable number of days after the issuance of the certificate (as determined by the Secretary), reasonable costs of storage and other carrying charges, as determined by the Secretary, shall be deducted from the value of the certificate for the period beginning after the reasonable number of days and ending with the date of the presentation of the certificate to the Commodity Credit Corporation. (C) Transfers.— Marketing certificates issued to domestic users and exporters of upland cotton may be transferred to other persons in accordance with regulations issued by the Secretary. (4) Exception.— The Secretary shall not issue marketing certificates or cash payments under paragraph (1) if, for the immediately preceding consecutive 10-week period, the Friday through Thursday average price quotation for the lowest priced United States growth, as quoted for Middling (M) 1 3/32-inch cotton, delivered C.I.F. Northern Europe, adjusted for the value of any certificate issued under this subsection, exceeds the Northern Europe price by more than 1.25 cents per pound. 110 STAT. 911 (5) Limitation on expenditures.— Total expenditures under this subsection shall not exceed $701,000,000 during fiscal years 1996 through 2002. (b) Special Import Quota.— (1) Establishment.— The President shall carry out an import quota program that provides that, during the period ending July 31, 2003, whenever the Secretary determines and announces that for any consecutive 10-week period, the Friday through Thursday average price quotation for the lowest-priced United States growth, as quoted for Middling (M) 1 3/32-inch cotton, delivered C.I.F. Northern Europe, adjusted for the value of any certificates issued under subsection (a), exceeds the Northern Europe price by more than 1.25 cents per pound, there shall immediately be in effect a special import quota. (2) Quantity.— The quota shall be equal to 1 week’s consumption of upland cotton by domestic mills at the season ally adjusted average rate of the most recent 3 months for which data are available. (3) Application.— The quota shall apply to upland cotton purchased not later than 90 days after the date of the Secretary’s announcement under paragraph (1) and entered into the United States not later than 180 days after the date. (4) Overlap.— A special quota period may be established that overlaps any existing quota period if required by paragraph (1), except that a special quota period may not be established under this subsection if a quota period has been established under subsection (c). (5) Preferential tariff treatment.— The quantity under a special import quota shall be considered to be an in-quota quantity for purposes of— (A) section 213(d) of the Caribbean Basin Economic Recovery Act (19 U.S.C. 2703(d)); (B) section 204 of the Andean Trade Preference Act (19 U.S.C. 3203); (C) section 503(d) of the Trade Act of 1974 (19 U.S.C. 2463(d)); and (D) General Note 3(a)(iv) to the Harmonized Tariff Schedule. (6) Definition.— In this subsection, the term “special import quota” means a quantity of imports that is not subject to the over-quota tariff rate of a tariff-rate quota. (c) Limited Global Import Quota for Upland Cotton.— (1) In general.— The President shall carry out an import quota program that provides that whenever the Secretary determines and announces that the average price of the base quality of upland cotton, as determined by the Secretary, in the designated spot markets for a month exceeded 130 percent of the average price of such quality of cotton in the markets for the preceding 36 months, notwithstanding any other provision of law, there shall immediately be in effect a limited global import quota subject to the following conditions: (A) Quantity.— The quantity of the quota shall be equal to 21 days of domestic mill consumption of upland cotton at the seasonally actuated average rate of the most recent 3 months for which data are available. (B) Quantity if prior quota.— If a quota has been established under this subsection during the preceding 12 110 STAT. 912months, the quantity of the quota next established under this subsection shall be the smaller of 21 days of domestic mill consumption calculated under subparagraph (A) or the quantity required to increase the supply to 130 percent of the demand. (C) Preferential tariff treatment.— The quantity under a limited global import quota shall be considered to be an in-quota quantity for purposes of— (i) section 213(d) of the Caribbean Basin Economic Recovery Act (19 U.S.C. 2703(d)); (ii) section 204 of the Andean Trade Preference Act (19 U.S.C. 3203); (iii) section 503(d) of the Trade Act of 1974 (19 U.S.C. 2463(d)); and (iv) General Note 3(a)(iv) to the Harmonized Tariff Schedule. (D) Definitions.— In this subsection: (i) Supply.— The term “supply” means, using the latest official data of the Bureau of the Census, the Department of Agriculture, and the Department of the Treasury— (I) the carry-over of upland cotton at the beginning of the marketing year (adjusted to 480-pound bales) in which the quota is established; (II) production of the current crop; and (III) imports to the latest date available during the marketing year. (ii) Demand.— The term “demand” means— (I) the average seasonally adjusted annual rate of domestic mill consumption during the most recent 3 months for which data are available; and (II) the larger of— (aa) average exports of upland cotton during the preceding 6 marketing years; or (bb) cumulative exports of upland cotton plus outstanding export sales for the marketing year in which the quota is established. (iii) Limited global import quota.— The term “limited global import quota” means a quantity of imports that is not subject to the over-quota tariff rate of a tariff-rate quota. (E) Quota entry period.— When a quota is established under this subsection, cotton may be entered under the quota during the 90-day period beginning on the date the quota is established by the Secretary. (2) No overlap.— Notwithstanding paragraph (1), a quota period may not be established that overlaps an existing quota period or a special quota period established under subsection (b).