FARM groups sent a letter to Ambassador Michael Froman of the Office of U.S. Trade Representative and Agriculture Secretary Tom Vilsack to express concern regarding the negotiations currently underway in Geneva, Switzerland, in preparation for the ninth World Trade Organization ministerial conference in Bali.
A number of countries had previously expressed concerns to the WTO Agriculture Committee that fellow WTO members' stockholding of food and other agricultural products could depress prices and affect their exports. The concerns were particularly about stockholding of rice in Thailand and India, wheat in India, soybeans and other products in Indonesia and cotton in China.
"We support the WTO, and we understand the value of the rules-based global trading system," the farm groups wrote. "However, we believe that a Bali agreement based on the so-called 'food security' proposal from the Group of 33 (G-33) would represent a significant step backwards for the WTO and would make it much more difficult to reach a comprehensive Doha Round agreement."
The groups' concern specifically addresses price supports in advanced developing countries that have the potential to distort trade.
"Support prices in several of those countries are now significantly above U.S. target prices, and studies suggest that they are exceeding, by a wide margin, the limits on domestic support to which they agreed in the Uruguay Round negotiations. Indeed, we see the G-33 proposal as an acknowledgement by those countries of their vulnerability to challenge under current rules. As we understand it, the G-33 proposal would significantly weaken subsidy disciplines by exempting from aggregate measure of support calculations price support regimes that are tied to domestic food aid programs," the groups wrote.
"We see no reason why WTO rules should allow such food aid to be linked to price support programs, which have much more to do with boosting farm income and increasing production than feeding the poor and which often result in the accumulation of excess stocks that are later dumped at subsidized prices onto the world market," the letter added.
The Bali ministerial meeting is planned for the beginning of December. Trade leaders are hoping to agree on an agenda that includes agricultural reforms for WTO members.