Farm Groups Mixed on WTO Roadmap

Cotton, which has been the biggest target of developing countries, has most reservations. Compiled by staff

Published on: Aug 4, 2004

Over the weekend trade ministers from 147 countries hashed out a blueprint on agriculture to move World Trade Organization (WTO) trade liberalization efforts forward. U.S. commodity organizations give the blueprint mixed reviews.

The National Cotton Council (NCC) has the most reservations. Perhaps that's because cotton has been in the cross hairs of the gun sights of trade negotiators for some developing countries, particularly Brazil, longer than other U.S. farm program crops.

NCC: Specific references to cotton concern growers

"We're disappointed to see cotton highlighted in numerous contexts," says Woody Anderson, NCC Chairman. "However, we're encouraged to see no specific commitments for an ‘early harvest’ of the cotton program, which would have required separate negotiations outside of the overall agriculture discussions."

NCC President and CEO Mark Lange notes that "singling out cotton as a separate issue is both unfair and inappropriate. Unfortunately, this initiative has been influenced by poor economic analysis. Particular emphasis on U.S. cotton is unjustified and unwarranted - the world cotton market is much more than the United States. We've not increased cotton production. But foreign production is surging, particularly in China and Brazil."

NCGA: Corn sees better market access

The National Corn Growers Association (NCGA) applauds the WTO effort.

"The framework calls for the eventual elimination of export subsidies and a significant reduction in import tariffs," says NCGA president Dee Vaughan. "This has long been a priority for NCGA and will provide new market opportunities for U.S. grain and value-added products.

"Plus, NCGA has long sought harmonization of trade distorting domestic support. The framework moves us in the right direction while ensuring the preservation of a strong farm safety net," says Vaughan. "We look forward to a final agreement that will increase global trade."

ASA: Soybeans see a tradeoff

The American Soybean Association (ASA) supports the U.S. negotiating team's position that reductions in trade-distorting domestic farm supports must be matched by meaningful gains in market access through tariff reduction and higher Tariff Rate Quotas on import-sensitive products. ASA believes that meeting this goal will be the key to achieving a successful outcome in the next phase of negotiations.

"ASA has asked that negotiations address the need to require advanced developing countries, particularly world class exporters like Brazil, to comply with the same disciplines on domestic support and export competition that developed countries must observe," says ASA President Neal Bredehoeft. "We will continue to press our negotiators to address this issue as the talks move forward."

ASA is concerned with how the product-specific spending caps to be imposed on trade-distorting programs included in the so-called Amber Box will be administered. Depending on the historical period chosen for establishing these ceilings, some commodities could be treated significantly better than others, which would skew production incentives under the Farm Bill.

"Global demand for high protein soybean meal and vegetable oil is rising rapidly," says Bredehoeft. "U.S. soybean producers don't want the farm program to provide disincentives for increasing soybean production as we seek to maximize our share of this growing market."

AFBF: Important direction for future negotiations

The American Farm Bureau Federation President Bob Stallman released a statement voicing support for the adopted framework text, saying it is an important direction for the future negotiations that the goal of "substantial improvement in market access" will apply to all agricultural products.

Stallman says, "The export competition measures in the text will benefit American farmers and ranchers by eliminating export subsidies and bringing rules to bear on the market-distorting operations of state-trading enterprises. We will also preserve the ability to provide food aid to those in need.

"The framework text does not settle all of the issues but it provides the opportunity to continue to work toward agricultural trade liberalization. We applaud the hard work of our U.S. trade team to provide a framework for future negotiations."

NFU: Farmers asked to sacrifice at altar of free trade

National Farmers Union President Dave Frederickson expressed disappointment with the World Trade Organization framework agreement approved over the weekend.

"This seems to be the administration's way of accomplishing through the WTO what they could not achieve in Congress-the elimination of U.S. farm programs," Frederickson says. "Once again U.S. farmers are being asked to sacrifice on the altar of free trade without getting anything in return.

"Our negotiators agreed to cut domestic economic safety net programs substantially, without identifying a plan to improve economic returns to producers or even achieve the same level of specificity concerning export subsidies or market access," Frederickson says. "It also fails to address specific trade distorting competitiveness issues such as exchange rates, labor and environmental standards and the effects of concentration."

"National Farmers Union is disappointed that the WTO framework will perpetuate a never-ending race to the bottom in producer commodity prices, pitting farmer against farmer and country against country for the one commodity all humans must have food," he adds.

Daschle: Trade negotiations hurt family farms

Sen. Tom Daschle, D-S.D., is against the proposed 20% reduction in farm subsidies for corn, wheat, soybeans, and other crops. He says this proposal marks a significant step backward for U.S. agricultural producers.

"The proposed cuts seriously jeopardize the increased loan rates, the updated bases and yields and the counter-cyclical payments that I fought for as majority leader during the 2002 farm bill.

"In every deal, there are winner and losers. In this deal, big agribusiness has won and family farmers in South Dakota and across the country have lost," Daschle says. "It appears the Bush Administration is selling out our farmers at the negotiating table. That's simply unacceptable."

Grassley: WTO only way to level playing field

Sen. Chuck Grassley, chairman of the Committee on Finance, says while the framework makes some positive advances, there still is a long way to go before the Doha Round is deemed a success for U.S. agriculture.

"The road map is there. Now we have to fill in the details," he says. "I know our farmers can compete with anyone in the world, but that competition must be on equal terms. The road map laid out this past weekend can surely help us get there, and I'll continue my efforts to make sure that this is what's achieved as negotiations continue.

Grassley adds that negotiations through the WTO are just about the only way to "achieve significant worldwide agricultural reform - reform that's necessary if U.S. agriculture is to compete on a level playing field." Grassley says he finds it ironic that some members of the Democratic Party are now criticizing a framework that would help us get there. "I'm certain that they would be complaining and criticizing just as loudly had no framework been achieved at all."