Bob Flautt

WILL GARRARD, THE HEART AND SOUL OF STAPLCOTN, became ill in 1956, "and for the next two years, it was really hard to do business the way Staplcotn had been doing it," Hank Hodges remembers. Bob Flautt chaired Board meetings and Skeet Coleman continued to run the pools. When Staplcotn's first general manager died September 8, 1958, the Board turned to one of its own to provide day to day leadership for the organization. Dr. Charles R. (Jerry) Sayre of Scott, MS, president of Delta and Pine Land Company, had been a director of Staplcotn since 1954. Howard Stovall of Clarksdale served with him on the Boards of both Staplcotn and DETPL. He saw in Dr. Sayre the vision and talents Staplcotn needed in Will Garrard's successor. Jerry Sayre, with his doctorate from Harvard, his solid cotton industry credentials and his active participation in governmental affairs affecting cotton, was Staplcotn's choice.

Congressman Frank Smith of Greenwood was a guest at the October 8, 1958 Board meeting where Dr. Sayre was elected president. The Congressman congratulated Sayre and the officers and directors of the Association "for being able to obtain his services. It is hard to conceive how any organization can add to its prestige after Mr. Garrard's loss, but without hesitancy, I know you will do it now."

Also at that meeting was Arkansas Congressman E.C. (Took) Gathings, who told the group, "You have made no mistake in selecting Dr. Sayre. At the time the Cotton Law was written in Washington, Jerry Sayre was there, and he helped write it."

On January 1, 1959, Jerry Sayre assumed command of an organization he described as "basically sound and vigorous in the sale of its members' cotton, and in the providing of production credit through Stapldiscount to members who wanted that service."

Within several months, Jerry Sayre had his initial organization in place. Vice president Bob Flautt continued presiding at Board meetings. Secretary-treasurer Hank Hodges' responsibilities included personnel, field offices, accounting, IBM, crop lien, stenographic pool, all local offices, fertilizer and insecticides and new enterprises.

Skeet Coleman headed Sales Control and Traffic, which included Pool, Merchandise and Factor sales. J. E. Coleman ran the Classing Department, including receiving and sample control, sample storage and laboratory. Herbert Chassaniol handled local sales for Greenwood, Clarksdale and Memphis.

Stapldiscount's team included Harry Patton, executive vice president; W C. McDougal, administrative assistant, new business and field representative; Hank Hodges, field offices, accounting and insurance; C. W. Smith, credit analysis; and J. M. Pierce, legal.

R. A. (Bob) Montgomery, a cotton technologist at Delta Branch Experiment Station at Stoneville, joined Staplcotn as administrative assistant July 1, 1960.

"Bob Flautt of Glendora was really the interim between Mr. Garrard and me with Stapldiscount," Dr. Sayre said. "He was an employee of Staplcotn and had been on the Board for years. Bob had a lot of ability and was not a flashy speaker or a spellbinder. He was able, in a balanced sort of way. He was what Staplcotn needed right then," Dr. Sayre said.

"Bob Flautt was the first active vice president," recalls R.E. (Bob) Dilatush, Jr., who joined Staplcotn in 1962 as head of the Crop Lien Department. "Prior to him, it was an honorary position, in case something happened to the president. He was the first one who really occupied the office. He came in every day and oversaw the financial matters, even though he was not treasurer," he said.

"Harry Patton ran Stapldiscount as a mother hen with one chick,' Dr. Sayre recalls. "Patton was Patton and told the Board and his membership that he wasn't taking any guff from anybody. He was a strong personality, which was good," he said.

Under Jerry Sayre's leadership, Staplcotn began a training program to bring new life and young blood into the organization. The 1961 "Freshman Group", as the trainees were dubbed, included Ben Brock, Lombard Burns, Vince Elliott, Henry Flautt and Leake Jones.

Cotton's greatest competitor was rayon. This manmade fiber, first introduced into the United States in 1911, was prodigiously successful everywhere. World production of rayon jumped from 450 million pounds in 1930 to three billion pounds in 1941. This was equivalent to 6 million bales of cotton. Soon after the end of World War II, man-made fibers took away from cotton a large part of its formerly monopolistic market for automobile tire fabrics, a market which annually consumed 600,000 bales of cotton.

By the 1950s, cotton was hit hard and was losing share of the fiber market, particularly to man-made fibers and to cotton competition in world markets from overseas growths. From a record of 588,228 bales in 1953-54, Staplcotn's volume for the 1957-58 season had skidded to 318,142 bales.

"It became abundantly clear that cotton had a rough row to hoe and Staplcotn had to continue to increase its leadership role, particularly in research and promotion," Dr. Sayre said. "It was also apparent Staplcotn needed to broaden its base in other phases of service for its members," he said in an early statement of the philosophy that shaped most of the two decades he led the Association.

During the 1959 harvest season, Walter Rayner of National Cotton Council asked Staplcotn's help soliciting NCC membership from Delta gins that were not current NCC members. The 32 gins in question handled 110,000 bales at the time. Rayner, a frequent visitor at Staplcotn Board meetings, would trade his NCC credentials 21 years later to provide the field leadership to successfully introduce Staplcotn's Mill Sales Program.

In the Spring of 1963, the Board decided to formulate a surfactant material to be sold to members under the SCCA label. A little over a year later, Don Ford, who headed the chemical and fertilizer operations, reported annual surfactant sales through May 1964 were 2,347 gallons, compared with 561 gallons for the same period of the preceding year. Also, at the prodding of Greenwood area growers, Staplcotn began investigating the possibility of providing a warehouse facility in that area.

Mr. and Mrs. W.L. Patterson with Staplcotn's 500,000th bale for the 1962-63 season. This was the 13,025,348th bale delivered during Staplcotn's 42 years in operation.

In 1964, Staplcotn formed Staple Cotton Services Association (A. A. L.). Staplservices, as it was quickly nicknamed, was a separate corporation "to buy, sell, manufacture and process farm chemicals, fertilizer and other farm supplies." Bob Flautt sold most of the stock in it, and Staplcotn built its first warehouses at Rising Sun.

The beginning of the Rising Sun Warehouse complex

"We changed the way cotton warehousing was done in the Mississippi Delta," Dr. Sayre said. "We adopted the western-type warehousing and received the cotton flat, as the bales come from the gin, stored them flat, and then compressed them outbound. The Delta style had been to compress the bales upon receipt from the gin. It required less storage space, but it meant higher cost in receiving time," he said.

The Warehouse Division was an almost immediate success. This stimulated the leadership within the organization to look into other types of service for our members," he recalled.

"We looked at farm chemicals as a possible area of additional service to our members," he said. "We even looked at crop dusting, but dropped that. We did do the chemicals and the livestock marketing. We got into fertilizer as a much more major undertaking. There was not complete satisfaction with our expanding in those directions," he said.

Another of Dr. Sayre's concepts grew into Forest Owners, Inc., a cooperative providing forest management and marketing services for Mississippi timberland owners. Staplcotn, Mississippi Chemical Corporation, Mississippi Federated Cooperative and the Mississippi Farm Bureau jointly developed this cooperative, loaning it the money needed for its organization.

At the June 13, 1962 Staplcotn Board meeting, Forest Owners manager Paul Waldrop credited Dr. Sayre with the original idea for the timber management co-op and Hank Hodges for its actual organization.

America in the 1960s was shaken to its core by the Cuban missile crisis, the assassination of John Kennedy, the Civil Rights movement, the ever-increasing involvement in Vietnam and the anti-war movement which it spawned. It was a world of dizzying change, carried into every American home by the nightly television news. Space exploration was on the rise. Social traditions were increasingly challenged. The number of family farms shrank.

Closer to the Delta, altered lifestyles contributed to a disturbing rise in the popularity of man-made fibers, and they began capturing markets once belonging primarily to cotton. By 1962, the synthetic fiber industry had taken a 300,000 bale per year slice out of the domestic cotton market and had stepped up its research and promotion drive.

Two years later, there were as many pounds of synthetics used by U. S. mills as there were pounds of cotton. Thirty years earlier, cotton had 83 percent of the market.

The American cotton industry fought back by increasing yields, improving cotton quality, and cutting production costs. However, many sensed this wasn't enough. The answer lay in an entirely different approach ... an instrument of change to overcome the synthetic fiber predicament. The response was the organization of the Cotton Producers Institute in 1961. Growers voluntarily contributed one dollar per bale through the program to fund cotton research and promotion.

Staplcotn went high tech in April 1962 and installed IBM Model 1401 data processing equipment at its main office. The new computer combined the functions of three different types of machines, replacing six pieces of equipment in Staplcotn's Data Processing Department.

In May 1964 a fire on the second floor of the Garrard Building resulted in the loss of approximately 1,500 samples.

In 1965, Stapldiscount loaned approximately $29 million, primarily for production and harvesting of cotton and soybeans. Stapldiscount provided funds for about 19 percent of the members of Staplcotn, who produced about 30 percent of the total bales delivered to Staplcotn.

Staplcotn's facilities were designed to handle 450,000 bales, but by 1965 receipts approached 930,000 bales. Staplcotn added 6,000 square feet of space by purchasing the old Bank of Commerce building adjacent to the Bledsoe Building, enclosing adjacent alley space and tying this into both the Bledsoe and Garrard Buildings. At the same time, early plans to house the farm chemical division headquarters and storage, sample storage and other functions not essential to a downtown location were being considered in what would become the Rising Sun warehouse complex.

By 1965, Staplcotn had 16 local offices, serving growers in Mississippi, Arkansas and Louisiana, and, on a limited basis, Missouri and Tennessee.

In 1966, Staplcotn was studying the possibility of a grain elevator at the Greenville Harbor Front Industrial Park. Staplcotn had purchased waterfront property on the new flood-free industrial park to build a river elevator. The project was not, however, without its detractors, and the land remained undeveloped for several years.

Staplcotn sold it to Farmers Grain Marketing Terminal, a cooperative which Staplcotn helped found. Staplcotn contracted to manage and operate the elevator for a flat fee plus a percent of the profit for its first three years.

"From the very beginning, Staplcotn provided a great service there," said W. A. Percy II of Greenville, longtime director of Farmers Grain and current chairman of Staplcotn's Board. "Staplcotn had no ownership in it, but they ran it full speed, and they didn't make any money on it. They ran it for free and provided some early leadership that really helped establish Farmers Grain," he said.

Alex S. Curtis, who farmed near Leland, led Farmers Grain to become a major Mid-South force in the marketing of soybeans, rice, wheat, corn and other grains. From a single 330,000 bushel elevator and river shipping point on Greenville's Lake Ferguson, Farmers Grain has grown to eight locations with more than 11 million bushels storage capacity.

Intrigued by the grain marketing business, Staplcotn also purchased inland elevators at Hollandale, Egremont and Webb. "We also negotiated on two or three more that, fortunately, we never bought," Bob Dilatush said.

At the same time Staplcotn entered the grain terminal business, the cooperative got into the cattle business. "We were expanding, of course, into the surrounding hill areas of Mississippi, and there were, at that time, a good many cattle herds in the Delta. There was a real need for marketing help for the producer," Dr. Sayre said. Staplcotn's Cattle Division purchased calves and raised them in Holmes and Carroll Counties to breeding size age, then sold bulls and cows that were certified breedable," Dilatush said.

"I'm not sure we did the best job of it," Dr. Sayre said. "We made an important effort, but it was not critical to the future of Staplcotn in any sense. We conducted a lot of contract sales, but very little in the way of auctions,' he recalls. "We tried auctions only a few times."

"Everybody was getting into the cattle business," Bob Dilatush recalls. "The livestock business is either booming or busting. About the time we started good, the bust came, and we had a lot of high priced cows," he said.

On May 14, 1969, G. C. (Cauley) Cortright became vice president of Staplcotn, not as a salaried employee, but in line of succession in case the president "become incapable of performing the duties of the president," Sayre explained. At the same meeting, M. L. (Mack) Alford became assistant treasurer, replacing Bob Montgomery.

In 1971, Staplcotn and the three other major U. S. cotton marketing cooperatives began efforts to combine their sales operations and to create an organization to offer the full range of American cotton to any textile mill in the world. At that time, Staplcotn, CALCOT, Ltd. in Bakersfield, CA, Plains Cotton Cooperative Association (PCCA) in Lubbock, TX and Southwestern Irrigated Cotton Growers Association (SWIG) in El Paso, TX marketed two to three million bales annually, or about 25 percent all of U. S. Cotton.

If the grower-members of these co-ops were all raising rain grown long staple cotton ... or if they were all located on the West Coast ... or if they were all growing pima ... or they were all growing short staple, stripper cotton, AMCOT would never have gotten off the ground. Fortunately, each of AMCOT's four partners handles a different kind of cotton, and there is virtually no competition for sales.

This fact had become apparent to several cotton co-op leaders in the late 1960s. There had been some sharing of Far East marketing activities prior to this time with CALCOT and PCCA working through a sales operation in Osaka, Japan, called Prodex. The idea for AMCOT, however, is generally credited to Dr. Jerry Sayre and CALCOT president Russell Kennedy.

"Jerry Sayre and Russell Kennedy were on a plane between Memphis and Dallas, exploring the possibilities of an organization like what was to become AMCOT," recalled former AMCOT chairman Sam Seitz. "They tried the idea out on other co-op leaders in the cotton industry; it met with a great deal of enthusiasm. CALCOT had had some associations with PCCA and Sayre and Kennedy's contacts resulted in Staplcotn being brought into the organization. With the addition of SWIG, all of America's major cotton co-ops were included.

"The idea was that AMCOT should be an organization to represent the American cotton cooperatives for sales as well as in a variety of governmental affairs and was to be an industrywide spokesman for the cotton co-ops," Seitz said.

The group picked up the corporate charter of the defunct American Cotton Cooperative Association (ACCA), which had been formed in the 1930s as a central marketing operation for co-ops. Its objectives had been entirely different from those of AMCOT. ACCA pooled cotton and did all the selling itself. This concept did not survive in AMCOT. "We wanted each of the member co-ops to sell its own cotton," Seitz said. "And with the $400 total capitalization we wanted all the co-ops to come in and have equal voice."

Sales operations began simultaneously in the Far East and Europe. Steve Bowkett, in London, was AMCOT's first man in Europe, succeeded a decade later by Peter Scott. American cotton sales to Western Europe were 1.1 million bales by 1986, and AMCOT sold 300,000 of those bales.

AMCOT took over two existing organizations in the Far East that had been started by PCCA under the leadership of PCCA president Dan Davis. By the time everything was in place, Kennedy had retired as president of CALCOT to be succeeded by Seitz.

Staplcotn director Cauley Cortright recommended Staplcotn join the new association. Kennedy served without pay as its first chairman until he again retired in 1977. He was succeeded by Seitz for the next decade until Hank Hodges retired as Staplcotn president to become AMCOT's third chairman in 1986.

"The joint sales efforts would lend strength and prestige in dealing with mills," Kennedy said. "It would allow for more economical operations, present a united front on improved marketing technology, and improve market information. Also, it would allow better working abilities with Cotton Incorporated to help develop better markets for U S. cotton."

AMCOT solicited both foreign and domestic sales for the four co-ops, but the actual sales would be made by the individual co-op with expenses shared on a per bale sold basis.

The four cotton marketing cooperatives could do all of these things on a joint basis because the cottons each marketed did not usually compete. PCCA generally marketed short staple cotton. SWIG sold extra long staple, Egyptian or Pima cotton. California's San Joaquin Valley and other areas serviced by CALCOT produced cotton generally of a higher grade than Mid-South and Southeastern cotton. Their chief marketing opportunities, however, developed in the Far East, whereas for Mid-South and Southeastern cotton the U.S. domestic industry became the main customer.

Several major international events impacted the 1972-73 marketing year. The oil crisis of 1973 increased production costs on farms. It took a much greater toll, however, on the producers of man-made fibers, who used the higher priced petroleum products to make their fibers.

Huge purchases of American wheat by the Soviet Union caused commodity prices to skyrocket. Demand for cotton increased, and prices rose dramatically from a low of 27 cents in the fall of 1972 to 90 cents in 1973.

From the days of the Korean War until the 1973 crop, "two thirds of the cotton in staplcotn's pool was sold and the remainder died in the loan," recalled Mack Alford, Staplcotn's assistant treasurer in 1973.

Cotton has became a commodity in which one could readily speculate. The whole market situation was changing, and producers were bewildered by prices they had never seen before.

"Staplcotn didn't take a leadership role, but continued to forward contract," Alford said. "We were not as great a force in cotton marketing in the Delta at that time. Staplcotn was successful in chemicals, aggressive in production financing, but not a leader or force in marketing, which was its original purpose," he said.

"A change in the government export program for 1973 triggered a tremendous increase in world demand for U. S. cotton," he said. "There was a lot of forward contracting with merchants buying all of a grower's production, regardless of volume, at a certain price. As world demand increased, merchants began to contract more and more of the 1973 cotton crop. Staplcotn also began forward contracting acres in the 32-34 cents per pound range.

Demand went up. The market went up. But production dropped, due to a flood that reduced cotton acres, resulting in a tremendous shortfall in bales. Prices tripled, reaching the mid 90 cent per pound range.

"We had to make up with cash on the futures market and with bales if sold on a firm fixed price contract to a mill," Alford says. "There was a tremendous loss. Staplcotn's salvation was that the next year's crop was contracted for, but had been neither hedged nor sold. We had a value in the next crop year that was a tremendous profit, more than offsetting the loss," Alford recalled.

The loss was severely damaging to the reputations of both Staplcotn and Dr. Sayre. "It cost him a lot in terms of credibility, even though the two years, coupled, were a success," Alford says.

The Board learned of the magnitude of the loss at its January 31, 1974 meeting ... a current earning deficit of $979,226. President and general manager Sayre shouldered the responsibility for Staplcotn's difficult position and within weeks had tightened operations controls, naming three assistant general managers: Quinton B. Perry, who was assistant vice president for Sales; Hank Hodges, who was treasurer and vice president of Stapldiscount; and Bob Montgomery, who was secretary and vice president of Staplservices. Dick Clarke continued as vice president of programs.

More significantly, the Board agreed to cover the 1973 loss with anticipated profits from the 1974 crop. Dr. Sayre told the Board that the target would be to reduce the 1973 fiscal loss to between $1,000,000 and $1,500,000. Director LeRoy Percy restated the proposal, saying, "We are talking about a $3 million or $4 million profit in 1974 and a loss in 1973 ... moving the 1974 business back to 1973. If it works out as we think, we will be taking around $1,500,000 from the 1974 business now on the books."

Staplcotn's 1973 loss resulted in a significant loss of prestige and confidence for Jerry Sayre, but a Board committee headed by John Daniel recommended Dr. Sayre continue as president, with primary emphasis on marketing and development of government relations. In addition, W T. (Bill) Moore, Jr. joined the staff as executive vice president of the three organizations "to bring the three more into an aligned organization," director Cauley Cortright explained. A Minter City, MS, native, Moore graduated from Yale and from Harvard Business School.

A navy veteran, he worked for Moore-McCormack Lines, a shipping firm founded by his grandfather. Moore headed a chain of newspapers in the Pacific Northwest before joining Staplcotn. Here was "a most personable young man who, in the eyes of your committee, has every qualification to fulfill this job," Cortright said.

Virginia White was hired as executive secretary to Bill Moore and later served in that capacity to Hank Hodges when he was named president. She was elected assistant corporate secretary in 1979. Five years later, she became the co-op's first female vice president.

Serving with Jerry Sayre and Bill Moore as Staplcotn officers were vice presidents Hank Hodges and Bob Montgomery, vice president for Programs Dick Clarke, and vice president of Sales Bert Kyle. Hodges was also named executive vice president and chief executive officer of Stapldiscount, with Dexter Walcott serving as Stapldiscount's vice president.

Bob Montgomery was named executive vice president and chief executive officer of Staplservices. Serving all three organizations was secretary W. W. (Sonny) Walker and treasurer Mack Alford. Within six months, the position of chairman of the Board was created. Cauley Cortright, who had been serving as Staplcotn's vice president and chairman of the executive committee, was named to the post.

Delta leaders had created Staplcotn's first Board to respond to challenges of the times. Now the Delta's future was again challenged, this time by a weakened Staplcotn. Again, a Board of Delta leaders took the reins and provided the strength to solve the problem.

After a booming first season, followed by two disastrous years, Staplservices decided to quit the cattle business in April 1976. Director and Livestock Committee chairman Harris Swayze of Yazoo City said, "We are just too small to ever make much off of it."

On September 1, 1976, C. J. (Skeet) Coleman retired after 55 years with the organization. Also, in autumn of 1976, Staplservices purchased Planters Compress in West Memphis, AR. Three years later, the West Memphis operation was sold to W B. Dunavant. In 1993 Staplcotn repurchased the property.

Following much debate, Staplservices was merged into Staplcotn in 1977. Staplservices president Bob Montgomery and director Walter Scott of Tallulah, LA, eloquently pled the case for the continued independence of Staplservices, but the leadership of Cauley Cortright, LeRoy Percy, Mike Sturdivant, Aven Whittington and others led to the merger.

"I was asked to resign in 1978, right at 19 years," Sayre recalls. "We lost some money, and it was on my watch. I took that hit. I am content with my contribution," he said.

Looking back on his departure from Staplcotn more than 20 years earlier, Sayre reflected on his years as president. "The Warehousing Division alone made the Staplservices efforts very much worth doing," he said. "Staplcotn is much stronger than it would have otherwise been. The importance of Stapldiscount was something that was recognized early on and must be kept as a key part of the services to the membership.

"I looked on AMCOT as a very strong, added feature to the sales structure. The leadership role of the cotton cooperative management and board members in Cotton Producers Institute, Cotton Incorporated, and the National Cotton Council is a key thing. Cotton co-ops cannot make their real contribution as service arms of their members unless they're providing a lot of the leadership in those organizations," Sayre said.

Aven Whittington expanded on Dr. Sayre's comments. "The leadership that expanded the chemical business, the rise of those services and the warehousing were all started under Jerry. He did a lot of good things for Staplcotn. I'm surprised he didn't change Staplcotn over to a stricter pool operation because he was very good friends with people at CALCOT and PCCA. He may have thought he just couldn't have persuaded people to do it," Whittington said.

When Jerry Sayre took over as president, average receipts for the five years prior to his leadership were 454,000 bales. In the 20 years he served, average annual bales was 611,000.

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