Ag Policy Blog
Chris Clayton DTN Ag Policy Editor

Monday 06/23/14

Talks Continue Over Brazilian Cotton Payments

I'm in Winnipeg for the World Congress on Conservation Agriculture this week. I need to get cranking to generate some articles from the event, but I also wanted to update the blog with some new material. I thought this was interesting. Anyway you look at it the Obama administration seems ready to pay Brazil to make the cotton case go away.

From DTN's Washington Insider:

U.S. and Brazilian government and cotton industry officials are continuing talks aimed at mitigating alleged economic harm caused by U.S. cotton programs. Prior to last October, the United States was making monthly payments to the Brazilian cotton industry of approximately $12.25 million in return for Brazil agreeing not to retaliate against U.S. cotton subsidies. The authorization for those payments expired Oct. 1, 2013, and Brazil would like them not only to be resumed but also topped off to make up for nine months of missed payments.

Brazil reportedly wants a payment of around $400 million. But the United States is said to be offering a payment of around $57 million for the delayed transfers from the time the prior payments were ended last September, until Feb. 7, 2014, the date President Obama signed the 2014 farm bill into law.

Brazilian officials have told the press that the United States wants to avoid a new World Trade Organization panel on the cotton issue to avoid opening up the new U.S. farm bill to broader scrutiny, especially the new safety net programs for major program crops. Thus the Brazilians appear to have a strong hand in the cotton negotiations.

Chris Clayton can be reached at chris.clayton@dtn.com

Follow him on Twitter @ChrisClaytonDTN

Posted at 10:47PM CDT 06/23/14 by Chris Clayton
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