The American Soybean Association (ASA) today endorsed the Administration’s World Trade Organization (WTO) agricultural proposals as the basis for moving forward in the Doha Round of negotiations to achieve positive results for U.S. soybean farmers and U.S. agriculture overall. At a press conference today in Washington, D.C., U.S. Trade Representative Robert Zoellick announced details of the U.S. trade agenda in the WTO.

"ASA supports the Administration’s position that these proposals must be viewed as a comprehensive package that will allow the United States to play a leadership role in the negotiations to fulfill each of the objectives set forth in the Doha Round Declaration," said ASA President Dwain Ford, a soybean producer from Kinmundy, Ill.

The Doha Round’s objectives are to achieve substantial improvements in market access, the phase-out and elimination of export subsidies, and substantial reductions in trade-distorting domestic support. ASA’s responses to the specific proposals are as follows:

Market Access – ASA strongly supports the harmonized tariff reduction formula proposed by the Administration to substantially improve market access. This approach would cut higher tariffs by a greater amount, thereby resulting in more equitable levels of tariffs worldwide, with no final tariff higher than 25 percent. United States agricultural tariffs average only 12 percent while agricultural tariffs in the rest of the world average 62 percent. The Doha Round must provide greater market access and level the international playing field for U.S. farmers and ranchers.

Export Competition – ASA supports the Administration’s earlier export competition proposal, including the elimination of export subsidies within a transition period.

Domestic Support – As part of a comprehensive and balanced package that greatly increases market access and eliminates export subsidies, ASA supports the Administration’s proposal to substantially reduce trade-distorting domestic support through a harmonized approach. This approach would require countries to reduce non-exempt, trade-distorting support to a common fixed percentage of the value of their agricultural production. Trade-distorting subsidies to farmers in Europe and some other countries are extremely high relative to their value of agricultural production, and a final Doha agreement must level the playing field for U.S. farmers and ranchers. The ability of the United States to support U.S. agriculture through "green box" policies that are not trade distorting must be continued and not made subject to a maximum cap. In addition, ASA supports maintaining the "de minimus" exception for minor and non-crop-specific support, and elimination of the exemption of "blue box" support.

While ASA supports the Administration’s WTO proposals as a basis for advancing the negotiations and achieving positive results for U.S. agriculture, ASA notes that there are additional areas within and outside the WTO negotiations that greatly affect U.S. soybean farmer and U.S. agricultural competitiveness. These additional areas must be addressed by the Administration and Congress in order for U.S. agriculture to fully realize the benefits of trade liberalization. They include:

Biotechnology – Some nations are attempting to restrict or raise the cost of imported commodities and foods produced through modern biotechnology. The Administration must be aggressive in bilateral and multilateral forums to ensure that other nations do not restrict imports through the use of scientifically unjustified, trade restrictive, or discriminatory access, traceability, labeling, or other barriers.

Intellectual Property – U.S. soybean farmers are extremely concerned that they are being placed at a competitive disadvantage due to the absence or lax enforcement of intellectual property protection in other soybean producing countries. U.S. growers currently are paying royalties or fees for access to certain soybean varieties with patented traits that amount to about 30 cents per harvested bushel, while growers in competing countries are pirating the seeds or paying nothing. The Administration must move aggressively to address this inequity that is placing U.S. soybean and product exports at a significant and unfair disadvantage.

Hidden or Unreported Subsidies – ASA urges USTR and USDA to actively identify subsidies and practices used by foreign competitors that directly affect domestic production or exports but that currently may not be reported to the WTO. Support for U.S. agriculture is very transparent and is notified by the United States to the WTO. ASA is concerned that competitor countries may be using mechanisms (e.g., forgiveness of debt, waiver or rebate of property or other taxes to encourage production or exports) that may not be reported to the WTO.

Exchange Rates – Exchange rates have a profound effect on the competitiveness of U.S. agriculture. U.S. soybean farmers and their export competitiveness have been very negatively impacted by a strong U.S. dollar and massively devalued currencies in other soybean exporting nations. ASA urges the Administration and Congress to work to develop approaches to mitigate the negative impacts a strong U.S. dollar and devalued foreign currencies have on the agricultural sector.

"A comprehensive agreement that includes all of these elements will level the playing field for U.S. farmers," Ford said. "It will provide for increased market access, which will spur growth in the demand for U.S. soybeans and soybean products."