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  • Aug 3rd, 2004
  • Comments Off on US cotton industry mulls impact of WTO deal
The US cotton industry - a prime target of developing countries which won concessions in a weekend deal on farm subsidies at world trade talks - on Monday issued a muted reaction to that weekend deal.

The cotton industry "is studying" the deal forged between rich and poor nations to eliminate farm subsidies in talks at the World Trade Organisation, an official of the National Cotton Council of America (NCC) told Reuters.

The official, who declined to be identified, said the NCC would need to look at the implications of the agreement. NCC is the main industry group for cotton farmers in the country.

The US cotton industry has come under fire particularly from Brazil and west Africa nations for the large subsidies it receives which they claim distort the world cotton market. Last month, NCC chairman Woody Anderson said efforts to "target US cotton are unfair and threaten the round."

He said the US cotton program has had little impact on world prices. China and Brazil have substantially raised cotton output compared to 2001, while the US has seen a fall in output, Anderson said.

The weekend pact reached in Geneva, rich countries made concessions to poor countries in promising to reduce both subsidies on their farm exports and domestic price supports. Better market access to rich countries from poor countries' farm exports were also pledged. The timetable was left open.

But of all commodities, cotton was specifically singled out for "appropriate prioritisation," the agreement said.

"Countries have agreed that cotton is a vital issue that will be addressed within the agriculture negotiations," the US Agriculture Department said in a statement posted on its Web site on Monday.

"As the G-8 Leaders recently affirmed, cotton is a matter of primary concern to African countries. Work on cotton will include all trade-distorting policies in the sector, including market access, domestic support, and export competition."

"US cotton producers are going to scream bloody murder," said one US agricultural trade policy expert on Saturday after the WTO agreement was announced.

US cotton farmers - with production centred in Texas, California and the Southeast - have for decades boasted one of the strongest farm lobbies working in Washington.

Copyright Reuters, 2004


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