Brazil Will Fight For Farm Markets

Government leaders in Brazil vow to gain a bigger share of world ag export market, as they await outcome of WTO ruling. John Otte

Published on: Jul 19, 2004

Editor's note: Our economics editor, John Otte, is in Brazil and contributed information for this report.

Brazil, already a growing powerhouse in agricultural production and exports of soybeans and other farm commodities, wants to gain an even bigger share of global markets.

To help reach that goal, government officials in Brazil, which has the largest economy of all South American nations, say they may register more complaints to the World Trade Organization (WTO). Their protests are in regard to subsidies paid to farmers in the United States and Europe by U.S. and European government farm programs.

Brazilian officials claim the subsidies paid by so-called rich nations are unfair and violate WTO rules. They say the subsidies that U.S. and European farmers receive distort trade patterns and take market share away from poor nations that can't afford to subsidize farm prices.

Brazil is prepared to battle trade barriers

Earlier this year, the WTO ruled in Brazil's favor on cotton, saying the subsidies the U.S. government pays cotton producers do indeed distort world trade. That decision is now being appealed to the WTO by U.S. government officials.

In reports published in the Brazilian news media, Brazil's agriculture minister Roberto Rodrigues says Brazil is currently waiting the outcome of the WTO cotton ruling before Brazil tries to challenge other farm aid--such as U.S. corn, wheat and soybean price support programs. Brazil is also awaiting a decision from WTO regarding Brazil's complaint about European sugar exports.

"We want to reduce protectionism and have a freer, fair and just market," says Rodrigues. "That would make new markets more viable and accessible."

Brazilian President Luiz Inacio Lula da Silva has spoken against U.S. and European farm programs since he was elected to office in January 2003. Brazil joined China and a number of other Third World countries to form a bloc that scuttled global free trade discussions at the WTO meeting in Cancun, Mexico.

Meanwhile, Brazil's output keeps growing

A more aggressive push by Brazil at the WTO would aggravate relations with the U.S., which are already strained by Brazil's resistance to a hemisphere-wide free-trade agreement that is being promoted by the United States.

In recent speeches, Lula has said the opening of new markets for agricultural products is crucial if Brazil is to meet its goal of becoming the world's biggest food exporter within a decade.

Last year Brazil became the biggest beef, poultry and soybean exporter in the world. Brazil took advantage of the BSE-related ban on U.S. beef exports and the drought in the U.S. which cut the size of the U.S. soybean crop. Brazil was already the world's biggest coffee, orange juice and sugar exporter.