USDA Pima Cotton and Wool Apparel Trust Fund Payments — Trade Relief for U.S. Textile Manufacturers
Legal Authority
- Trade and Development Act of 2000 (P.L. 106-200) — Established the Pima Agriculture Cotton Trust Fund and the Agriculture Wool Apparel Manufacturers Trust Fund to compensate U.S. textile manufacturers for reduced tariff protection on cotton and wool apparel imports under trade agreements
- American Jobs Creation Act of 2004 (P.L. 108-357) — Reauthorized and modified the trust fund payments; adjusted payment rates and eligible product categories
- 7 CFR Part 1471 — USDA Farm Service Agency implementing regulations; governs eligibility determination, payment calculation, application procedures, and fund disbursement for Pima cotton and wool apparel trust fund payments
Key Mechanics
7 CFR Part 1471 implements two trust fund programs that compensate U.S. textile manufacturers for competitive injury caused by reduced tariffs on cotton and wool apparel imports under trade agreements: (1) Pima Agriculture Cotton Trust Fund — provides payments to U.S. manufacturers of apparel made from Extra Long Staple (ELS/Pima) cotton; designed to offset the impact of reduced tariffs on ELS cotton-content apparel imports; (2) Agriculture Wool Apparel Manufacturers Trust Fund — provides payments to U.S. manufacturers of worsted wool suits and related wool apparel; designed to offset competitive disadvantage from reduced tariffs on wool apparel imports under trade agreements. Payments are calculated based on the manufacturer's domestic production of eligible apparel products documented in a base period, multiplied by a statutory per-unit payment rate. Eligible manufacturers apply to FSA; FSA verifies production documentation and calculates individual payment amounts. Both trust funds operate as fixed-appropriation programs — total payments are capped at the congressional appropriation; if total calculated payments exceed the appropriation, each manufacturer's payment is prorated. The programs are trade-remedy payments rather than commodity price supports — they provide transitional income relief to manufacturing firms, not agricultural producers.
Current Rule (2026)
| Parameter | Value |
|---|---|
| Citation | 7 CFR Part 1471 |
| Issuing agency | USDA Farm Service Agency (FSA) / Commodity Credit Corporation (CCC) |
| Statutory authority | Trade and Development Act of 2000 (P.L. 106-200); American Jobs Creation Act of 2004 |
| Last major amendment | Program updated by successive trade legislation |
What This Rule Does
When Congress adjusts trade policy — reducing tariffs on imported textiles to meet international commitments — U.S. textile manufacturers who depended on those tariffs for competitive protection face sudden economic pressure. Rather than simply exposing these manufacturers to international competition without cushion, Congress created two trust funds to provide transitional payments:
The Agriculture Pima Trust Fund helps U.S. manufacturers affected when tariffs on Pima (long-staple) cotton fabrics were reduced or eliminated. Pima cotton is grown primarily in Arizona, New Mexico, Texas, and California; its distinctive fiber length makes it valuable for premium shirt fabric and luxury textiles. Payments from the Pima Trust go to three beneficiary groups: producers of ring-spun pima cotton yarn, manufacturers of men's and boys' Pima cotton shirts, and pima cotton trade associations.
The Agriculture Wool Trust Fund helps U.S. wool manufacturers affected by tariff changes on wool fabrics. Payments from the Wool Trust go to manufacturers of certain worsted wool fabrics, through duty refunds for imported wool yarn inputs, compensation for the elimination of a wool tariff-rate quota (TRQ) that expired in 2014, and additional compensation for wool yarn, fiber, and top duties.
Seven CFR Part 1471 governs eligibility, payment calculations, documentation requirements, and annual disbursements from both trusts.
Key Provisions — Pima Cotton Trust Fund
- § 1471.1 — Common provisions for the Pima Trust: CCC distributes Pima Trust funds annually to the three eligible groups; payments are sized based on available funding under the authorizing legislation
- § 1471.2 — Pima cotton payments: each year CCC pays out Pima Trust funds according to a statutory allocation: 25% goes to one or more U.S. pima cotton trade associations (for promotion and market development); the remaining 75% goes to producers of ring-spun pima cotton yarn and manufacturers of men's/boys' pima cotton shirts in proportions set by CCC
- § 1471.3 — Yarn producer affidavit: each year, a producer of ring-spun pima cotton yarn who seeks a Pima Trust payment must submit a sworn affidavit certifying that it manufactured ring-spun yarn from pima cotton in the preceding year; the affidavit must include production data documenting the quantity of pima cotton consumed
- § 1471.4 — Shirt manufacturer affidavit: manufacturers of men's and boys' cotton shirts seeking Pima Trust payments must submit a signed affidavit annually certifying that they manufactured qualifying cotton shirts in the calendar year immediately before the claim; documentation of production volumes supports the payment calculation
- § 1471.5 — Trade association affidavit: pima cotton trade associations must submit a signed statement and any other information CCC requires to demonstrate their eligibility and intended use of Pima Trust funds
Key Provisions — Wool Trust Fund
- § 1471.10 — Common provisions for the Wool Trust: CCC provides payments from the Agriculture Wool Trust of up to $30 million per year to help U.S. wool manufacturers harmed when tariff preferences for imported wool were reduced or eliminated
- § 1471.11 — Worsted wool fabric payments: each year CCC pays manufacturers of certain worsted wool fabrics a per-unit amount based on their production of eligible fabric; the payment compensates for the competitive disadvantage created by tariff reductions on imported wool fabric
- § 1471.12 — Duty refund for wool yarn imports: CCC pays duty refunds for imported wool yarn that was subject to duty when equivalent domestic wool yarn of the same specification was unavailable at competitive prices; the refund offsets the input cost disadvantage for manufacturers who must import specialized wool yarn
- § 1471.13 — Wool TRQ monetization: the wool tariff-rate quota that previously gave manufacturers access to cheaper imported wool at a lower tariff rate expired December 31, 2014; CCC pays manufacturers what they would have saved under the TRQ, calculated based on their documented import volumes during the TRQ period
- § 1471.14 — Wool yarn, fiber, and top duty compensation: CCC pays an annual amount equal to the import duties manufacturers would have saved if the duty suspension for certain wool inputs had remained in effect; the payment is tied to documented import levels and the differential between suspended and applied duty rates
How It Affects You
If you manufacture ring-spun pima cotton yarn or men's/boys' pima cotton shirts, you are potentially eligible for annual Pima Trust payments from CCC. The program requires you to file an annual affidavit documenting your production — the payment calculation is based on that production data. Contact your FSA county office or USDA's Farm Service Agency trade programs office to file claims.
If you manufacture worsted wool fabrics or use imported wool yarn inputs, the Wool Trust program may compensate you for the cost impact of tariff changes. The $30 million annual cap is divided among all eligible manufacturers; if total eligible claims exceed the cap, payments are prorated.
Both programs have annual affidavit and documentation requirements. Missing the filing window means missing the year's payment — there is no retroactive recovery for late claims. Build the annual filing into your production administration calendar.
Pima cotton trade associations receive 25% of the Pima Trust allocation for market development, promotion, and other collective industry activities. If you are a pima cotton grower or processor, your industry association's access to these funds is part of the program's structure.
Statutory Authority
This rule implements:
- Title V of the Trade and Development Act of 2000 (P.L. 106-200) — Created the Agriculture Pima Trust Fund and directed CCC to distribute funds to pima cotton yarn producers, shirt manufacturers, and trade associations
- American Jobs Creation Act of 2004 (P.L. 108-357) — Expanded the Wool Trust Fund provisions and added the duty compensation and TRQ monetization payments for wool manufacturers
- Subsequent trade legislation — Additional authorizations and modifications enacted through the Farm Bills and trade legislation of the 2000s and 2010s
Recent Rulemakings
No major Federal Register amendments reported. The trust fund programs operate under the original authorizing legislation, with payment levels and eligibility confirmed annually through the appropriations and CCC funding processes.