WASHINGTON, DC – USDA is developing a new trade mechanism that would reward selected countries for buying U.S. cotton by offering preferential tariff treatment on apparel made with American cotton and textile inputs.
The Foreign Agricultural Service will assume responsibility for the cotton tariff-rate quota process and plans to launch the new mechanism in 2027. USDA says the program will focus on Bangladesh, Indonesia, Cambodia and Malaysia.
Under the plan, USDA would verify purchases of U.S. cotton by participating countries. In return, qualifying apparel produced with U.S. cotton and textile inputs could receive preferential tariff treatment when entering the United States.
The approach is part of USDA’s Great American Cotton Plan, which is intended to expand trade opportunities and strengthen demand for U.S. cotton. The department has not yet released detailed purchase thresholds or tariff terms.
Final program design will determine how much additional cotton demand is created and whether textile manufacturers in participating countries shift more sourcing toward U.S. fiber.
Farm-Level Takeaway: Linking tariff benefits to verified U.S. cotton purchases could create new export demand if participating countries increase sourcing.