U.S. Cotton Faces Challenges – From Farm Policy Preservation to EffectiveTrade Agreement Negotiations
NCC Chairman Kenneth Hood told those attending the 2003 Beltwide Cotton Conferences that the NCC’s primary challenge since passage of the new farm bill and one that persists -- has been maintaining that policy in the face of a constant flow of misinformation and negative publicity. NCC President and Chief Executive Officer Gaylon Booker said with trade liberalization inevitable, the U.S. cotton industry can no longer afford to allow U.S. trade negotiators to be generous with U.S. market access without getting something meaningful in return.
NASHVILLE, TN – National Cotton Council Chairman Kenneth Hood told those attending the 2003 Beltwide Cotton Conferences here today that the NCC’s primary challenge since passage of the new farm bill and one that persists -- has been maintaining that policy in the face of a constant flow of misinformation and negative publicity.
“Most of the Congressional criticism is coming from members who want to see more restrictive payment limits and they are looking for a legislative vehicle to amend those provisions,” the Gunnison, MS, cotton producer said during the Cotton Production Conference. “The Council has been working to repel further restrictions on program benefits since early last year and continues those efforts as Congress renews the appropriations process this month.”
Hood’s remarks came at the NCC-coordinated forum attended by 3,000-plus cotton industry members, researchers, Extension personnel, county agents, consultants, agribusiness representatives and others with a vested interest in the U.S. cotton industry.
The NCC, he said, also has joined an array of general farm, commodity, bank and manufacturer organizations in urging Congressional support for emergency disaster assistance for crop and livestock producers who suffered losses during the 2001 and 2002 production years.
“Our goal has been to persuade Congress to provide this assistance on a truly emergency basis, just as other disaster assistance is provided for losses due to severe storms, without requiring offsets. As we continue our efforts to secure disaster assistance . . . we also are doing everything possible to put a firewall between disaster assistance and farm program spending. We are especially concerned about offsets that would be achieved through more restrictive payment limits or reductions in payments authorized in the new farm law."
Hood reiterated the NCC’s support of enhanced proven, incentive-based conservation programs – programs that should be a complement to effective commodity programs and not a substitute.
He noted that the NCC had arranged educational tours for key Congressional and Natural Resources Conservation Service staff to help them in their development of new Conservation Security Program.
Regarding technology, Hood said the role of research, education and technology in achieving production and processing profitability will be increasingly important.
Among examples he cited of NCC action in that arena was its work to secure government approval of transgenic varieties, and to ensure that resulting cotton and cottonseed products are not confronted with marketing restrictions.
Hood said in recent months trade issues have taken on added importance, given the Administration’s strong emphasis on trade liberalization. He cited as a major cotton industry concern, China’s restrictive implementation of its quota agreement, which, together with the announcement of a new standard for neps and short fiber, puts limits on market access that violate terms of the WTO accession agreement.
In a later report, NCC President and Chief Executive Officer Gaylon Booker said with trade liberalization inevitable, the U.S. cotton industry can no longer afford to allow U.S. trade negotiators to be generous with U.S. market access without getting something meaningful in return.
He said the U.S. textile industry has not been a high priority for those negotiators in the past as evidenced by the U.S. tariff rate average of 8.9 percent compared to effective rates for textile and apparel products entering Argentina of 40-50 percent; Brazil, 40-70 percent; China, 20-36 percent; India, 50-70 percent and Pakistan, 40-60 percent.
“We have the same kind of unlevel playing field in agricultural product tariffs,” Booker said. “The U.S. faces a 62 percent average allowable tariff rate when it ships agricultural products abroad, with the rate in many countries exceeding 100 percent. Our competitors abroad can ship their products into the U.S. and pay a modest 12 percent tariff.”
Booker also noted that as the U.S. Trade Representative presses the Administration’s trade agenda, it will be crucial to make policymakers understand that “global farm policy and international trade policy must be compatible and fair. For the cotton industry, good farm policy and good trade policy must take into account the interests and needs of the U.S. textile industry. All of us have become keenly aware of the economic stress that our domestic textile industry is experiencing. We cannot export enough cotton to maintain a viable U.S. cotton industry – we must find a way to provide better underpinning for the domestic textile industry.”
Booker said the following principles must be maintained if global farm and trade policy are to reconciled so that developed countries such as the U.S. can be viable: 1) U.S. farm programs cannot be unilaterally reduced or phased out, 2) U.S. agricultural and textile tariffs cannot be further reduced until other nations reduce their tariffs to US levels, 3) market access must be reciprocal, 4) non-tariff barriers must be eliminated, 5) export subsidies must be eliminated, or harmonized, and 6) improvements must be made in international trading disciplines and dispute settlement procedures (and the U.S. must have the will to use the tools that are available).