Reuters news reported yesterday that, “A U.S. offer to slash its maximum farm subsidies is insufficient for a world trade deal to be reached, French Agriculture Minister Michel Barnier said in an interview published on Monday…France has repeatedly called on the United States and developing countries to make more concessions in order to salvage the Doha round of world trade talks, calling for more ‘reciprocity’ from other parties…’The European Union has no more concessions to make — it has made many.’”
I. Farm Bill
II. WTO / Doha Considerations
I. Farm Bill
Sarah Lueck reported in today’s Wall Street Journal that, “A dispute over tax changes under consideration in the Senate to fund new tax breaks for farmers shows that Congress has its work cut out meeting new pay-as-you-go budget rules.
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Lee Berthiaume, in an article posted yesterday at The Embassy Online (Canada), reported that, “Canada and Brazil are working to get a World Trade Organization dispute panel to hear their respective complaints about American agricultural subsidies at the same time.
“‘Canada’s focus is on advancing the potential alignment of the Canadian and Brazilian cases given that both countries share the same concerns and same objectives of disciplining and reducing U.S. trade distorting subsidies,’ said International Trade spokeswoman Renée David.
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Dow Jones writer Grace Fan reported yesterday that, “Brazil is planning to join Canada in a complaint lodged at the World Trade Organization against unfair U.S. agricultural subsidies, a Brazilian Foreign Ministry spokesman told Dow Jones Newswires on Tuesday…The Foreign Ministry will release a statement tomorrow, but I can confirm that Brazil will ask for more information from the U.S. on these subsidies as a co-author with Canada,’ said the spokesman in a telephone interview…A few weeks ago, Canada formally asked the WTO to establish a dispute settlement panel, charging that the U.S. had breached WTO commitments by surpassing a $19.1 billion WTO spending limit in six out of the past eight years.”
I. Farm Bill
II. Doha / Trade
III. EU
I. Farm Bill
Senate
Chris Clayton, writing yesterday at DTN (link requires subscription), reported that, “There are growing rumblings as members of Congress who don’t want to risk seeing a farm bill full of reform argue there isn’t enough time to debate a farm bill on the floor of the U.S. Senate this year, Sen. Richard Lugar, R-Ind., said Monday.
“The Senate is piling up critical issues to debate, most of which tie back to the Iraq war. Such a full plate of issues would spark at least some lawmakers to avoid an arduous debate on farm policy by pushing an extension of the current programs, Lugar said in an interview Monday.
“‘I see some inklings that this is where we are headed,’ he said.”
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On Tuesday, members of the House Agriculture Subcommittee on General Farm Commodities and Risk Management “voted 18-0 to base the new farm bill on an extension of current crop support rules” (Reuters).
Brownfield’s Bob Meyer reported yesterday that, “Wisconsin Congressman Ron Kind [is] among those quite disappointed by the House Ag Subcommittee decision to extend the current commodity title through the next farm bill. The group completely ignored the changes suggested by Kind’s FARM 21 plan. ‘Reform is going to occur one way or the other,’ the La Crosse Democrat says, ‘I’d rather have Congress deal with some of the reform proposals rather than have it done for us by outside entities through these challenges with the World Trade Organization.’
“Kind agrees with comments that the subcommittee decision is a starting-point; he says there is a lot of interest in seeing a strong conservation title, reform of the nutrition programs, more for biofuels production. Kind says the only way these things can be accomplished is by reforming the commodity subsidy programs, ‘I hope the Committee, I hope Chairman Peterson keep an open mind.’”
To listen to a Brownfield interview with Rep. Kind, just click here (MP3).
In the six-minute interview, Rep. Kind used a phrase that Secretary of Agriculture Mike Johanns often delivers and stated that; it was time “take this bulls eye off the backs of our farmers.” Kind and Johanns use this phrase in reference to potential risks associated with WTO litigation asserting that current Title I commodity supports may not be in compliance with WTO covered agreements.
Graph from The Wall Street Journal Online.
Rep. Kind also noted that the market prices for some program crops are currently strong and that this price environment would be conducive to a change in the direction of Title I.
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Reuters writer Doug Palmer reported yesterday that, “Months of behind-the-scenes work could lead to dramatic progress in world trade talks next week when top trade officials from the United States, European Union, Brazil and India meet in Potsdam, Germany, the chief U.S. negotiator said on Thursday…‘We’re really hoping we can move the ball forward and ideally move it forward dramatically,’ U.S. Trade Representative Susan Schwab told Reuters in an interview. ‘The United States is committed to doing our share and then some’ to reach a final deal in the talks, she said.”
I. Corn / Biofuels
II. Farm Bill Debate
III. Doha
I. Corn / Biofuels
Michael S. Rosenwald reported in today’s Washington Post that, “The nation’s unquenchable thirst for gasoline — and finding an alternative to what’s been called our addiction to oil — has produced an unintended consequence: The cost of the foods that fuel our bodies has jumped. (Picture at right from The Kansas City Star Online).
“Beef prices are up. So are the costs of milk, cereal, eggs, chicken and pork.
“And corn is getting the blame. President Bush’s call for the nation to cure its addiction to oil stoked a growing demand for ethanol, which is mostly made from corn. Greater demand for corn has inflated prices from a historically stable $2 per bushel to about $4.
“That means cattle ranchers have to pay more for animal feed that contains corn. Those costs are reflected in cattle prices, which have gone from about $82.50 per 100 pounds a year ago to $91.15 today.”
The article also noted that, “But now some economists and analysts say the corn price increase could combine with other factors — poor weather and soaring energy costs — to unsettle the food industry, since corn products are used not just to feed animals but also in high-fructose corn syrup, the sweetener of choice for such products as soft drinks and cookies.”
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