03/10/05 It`s more than cotton

In the week since a World Trade Organization appeals panel upheld last year's decision against the U.S. government's policy on cotton subsidies, several American farm groups have been studying the impacts of the decision. That includes the U.S. Trade Representatives Office which has been dealing with W.T.O. ag trade reform negotiations. Richard Mills works for U.S.T.R. MILLS: We will be continuing to work closely with Congress and our farm community, obviously, on our next steps. It would be premature to speculate or highlight what those might be. Some in Northwest agriculture might say, "What does a ruling about cotton have to do with me?" The answer could be, "quite a bit", because many are saying the ruling has broad implications to U.S. farm programs such as farm subsidy payments. To give background on the situation, Brazil issued a W.T.O. challenge to the U.S. cotton program and some of its components in 2003. Last year, the W.T.O. ruled in favor of Brazil, saying many U.S farm programs, not just cotton, contain illegal export subsidies or domestic payments that are higher than permitted by W.T.O. rules. Our government disagrees with that finding, unsuccessfully appealing the original verdict. In fact, one lawmaker, Senate Ag Committee Chair Saxby Chambliss of Georgia believes the ruling does not contain provisions that the U.S. must immediately comply. If the W.T.O. finds Chambliss wrong, it would mean Brazil would be able to issue retaliatory tariffs against U.S. goods & and so much more. There is already talk by prominent farm state lawmakers like Iowa Senator Tom Harkin that sooner or later, Congress will have to re-examine all commodity and export programs that are seen as production, price, or trade distorting. Does that mean the work to craft the 2007 Farm Bill, scheduled to start later this year, will have to start sooner so U.S. policy can comply with W.T.O. regulations? Some say it well could. And Mills says in addition, the ruling places a greater emphasis on the U.S. to craft a favorable ag trade reform deal during the continuing Doha round W.T.O. negotiations. MILLS: Currently, our farmers and ranchers face high foreign barriers to our farm goods. So it's critical that trade reform gets all the players to the table internationally to address the global distortions in agricultural trade that blocks many of our exports. That's what we're focused on in the on-going Doha W.T.O. negotiations trying to lower the barriers that our farmers face in exporting our world class goods.