Farm News
07-14-06
Groups hopeful of renewed talks on trade
By KRISTIN GREINER- Farm News staff
When World Trade Organization (WTO) Doha Round talks stalled a couple of
weeks ago, many people were left wondering just what shape the farm bill will
take.
Because the WTO talks fizzled out, agriculture groups are honing in on what this
means for trade and U.S. products. Mark Salvador, national policy advisor with
the Iowa Farm Bureau Federation, said Farm Bureau members were
disappointed to learn of the WTO’s failure to produce “fruitful”î trade negotiations.
“Without a new WTO agreement, Farm Bureau members will seek an extension
of those farm policy concepts included in the 2002 farm bill. Farm Bureau cannot
support unilateral trade disarmament or reductions in farm support without real,
commercially meaningful gains in foreign market access in both developed and
developing countries,Ӕ Salvador told Farm News.
Carol Balvanz, director of policy development and producer services for the Iowa
Soybean Association (ISA), said information her organization has received from
sources indicate that while the WTO talks have been considered stalled, there
very likely will be ongoing negotiations and quite possibly a reconvening of the
ministers later this summer.
“The Iowa Soybean Association position continues to be that while we are willing
to consider farm programs that would qualify as non-production and non-trade
distorting under WTO rules, our producers need major movement in market
access to other countries through meaningful tariff reductions,î” Balvanz said.
“We also believe that Congress must insist that any final agreement must
eliminate differential export taxes. If there is no major commitment on market
access by other countries, Congress should urge the administration to make a
commensurate reduction in its aggressive offer last October to reduce tradedistorting domestic support.î”
The National Corn Growers Association (NCGA) also stated a deal could still be
worked out. Joint Trade Policy A-Team Chairman Bob Bowman with the NCGA
said his organization is not giving up.
“We’re confident something will be worked out,”î Bowman said in a statement.
“Progress is never made until the last hour. We’re disappointed there doesn’t
seem to be enough movement from the other parties, but everybody knows trade
promotion authority expires in 2007, so we have to get our work done before
that.î”
Mick Kreidler, communications director for the Iowa Cattlemen’s Association
(ICA), said the state cattlemen’s group supports the National Cattlemen’s Beef
Association in its efforts on issues like removing the European Union ban on beef
implanted with growth promotants and encourages the national group’s legal
foundation to pursue legal action against the European Union that would benefit
the U.S. beef industry to gain relief from the hormone ban.
“We do not know how the U.S. farm bill will take shape, now that the WTO talks
have failed. The ICA policy states that ‘the intent of American farm policy should
be profitable markets with emphasis on producing and exporting value-added
products,’”î Kreidler said. “The ICA board of directors monitors the
implementation of each new farm bill to encourage the continuation of Iowa’s
beef industry.Ӕ
Tanya Augustson, director of public relations for
the National Cattlemen’s Beef Association (NCBA), told Farm News the NCBA
will continue to urge increased global market access opportunities through tariff
reduction.
“We have long believed the greatest trade benefits can be obtained via the
multilateral WTO negotiating process. NCBA supports the U.S. proposal for WTO
agriculture negotiations that would reduce tariffs for our products,Ӕ Augustson
said. “NCBA is encouraging feedback from its members on farm bill programs
and policy priorities.î”
The American Soybean Association (ASA), along with other farm groups, sided
with the 57 U.S. senators who sent a “strongly worded”î letter to President
George W. Bush clearly stating a WTO agreement is critical in “achieving
commercially meaningful market access gains and the elimination of trade
distorting export practices.î”
Robert Wisner, Iowa State University Extension grain economist, said
problems with the cotton loan deficiency payment (LDP) at the WTO talks could
mean other countries will object to the U.S. corn LDP program. Efforts might
need to be made to reduce the corn LDPs international market impact, he said.
Wisner also expects strong pressure from midwestern and southern legislators to
maintain crop supports near current levels during farm bill talks, and southern
members of Congress likely will “strongly resistî” tightening payment limitations.
“It would not be surprising to see modest reductions in U.S. crop supports,
probably in the form of loan rate and counter cyclical payment (CCP) mechanism
adjustments. We might also see a first-stage movement toward shifting CCPs
and LDPs to a crop revenue insurance type of format, based on county average
yields. This concept, if applied, would compare a farmer’s current crop income
(measured by using county average yields and current prices) with a preestablished standard,Ӕ Wisner said.
“If income fell below the established standard by a certain percentage, payments
would be made to the farmer. With this concept, payments could vary from
county to county. I don’t expect a complete shift from current programs to this
income insurance concept, but an initial phase-in might, for example, replace
CCPs but not LDPs,î” he said.
Because of the importance of current payment limits to large farms in the South,
Wisner said it is doubtful significant changes will be made in per person farm
program payment limits in the upcoming farm bill. But the current rapid expansion
in corn-based ethanol and soy-based biodiesel plants suggest farm program
payments may become less important to farmers in the next few years than in
the past, he added.
“It also would not be surprising to see an increased emphasis on renewable
fuels in the farm bill, with strong support for corn-based ethanol and biodiesel.
Other dimensions might include increased incentives for conversion of biomass
such as straw, corn stalks, switch grass, forest product wastes, manure and
other agricultural and forestry based raw material into ethanol,” Wisner said.
“Sugar beets, sugar cane, sorghum and potatoes could be other farm products
receiving incentives for use in ethanol production. Expanded emphasis on
biofuels also would contribute to rural development programs.î”