Cautions that Details Will Determine Support

The American Soybean Association (ASA) today commended United States and European Union (EU) negotiators on reaching agreement on a framework for agricultural negotiations in the World Trade Organization (WTO) talks in Geneva.

"It is important that the two largest participants in global agricultural trade have agreed on a way to move these negotiations forward," stated ASA President Ron Heck. "However," the Perry, Iowa, soybean producer continued, "the value of any final agreement to U.S. soybean farmers will depend on many details yet to be negotiated."

Heck’s comments followed release of a "Joint EC-US Paper" that summarizes agreement on the "three pillars" of the agricultural negotiations – domestic support, market access, and export subsidies. Specific reduction commitments for trade-distorting domestic support programs remain to be determined.

"However," Heck noted, "it is important that the EU has agreed that its higher level of support should be harmonized relative to support provided by the U.S." The ASA President pointed out that, "The Paper does not propose placing restraints on the level of support provided by developing countries to expand their agriculture production and transportation infrastructure. This is an area that will need to be addressed at the Ministerial meeting in Cancun."

According to Heck, "Market access is the most important area for U.S. soybean producers in the Doha negotiations, and the framework provides little detail on how tariffs will be reduced." He added that, "ASA strongly believes the success of the Doha Round will depend on requiring developing countries with low per capita consumption of protein and vegetable oil to open their markets in a substantial way."

In the area of export subsidies, Heck stated, "ASA is concerned that export credits are proposed to be disciplined in the same manner as export subsidies." He noted that, "Credit guarantees are important to the competitiveness of U.S. soybean exports, and ASA would not support sharp reductions in or elimination of this program."

Finally, Heck expressed concern that the Paper proposes bringing foreign food assistance programs under WTO rules. "Our position has been that current food aid conventions are adequate in addressing this issue. We do not want to see food aid replaced by monetary assistance."

The ASA President concluded his remarks by stating that, "ASA will continue to work closely with U.S. negotiators during the coming weeks before the Cancun Ministerial so they remain fully aware of soybean interests in these talks."