News Update

News Update
Dec. 20, 2005

House Approves Ag Budget

The U.S. House of Representatives early Monday approved a measure that would trim the U.S. Department of Agriculture (USDA) budget by $2.7 billion during the next five years. The legislation, if finalized, would cut conservation, research and rural development programs.

According to The Des Moines Register, Agriculture Secretary Mike Johanns praised the measure, aimed at reducing the deficit. Farm groups lobbied Congress to extend grain and cotton subsidy programs beyond their 2007 expiration date, the article noted; however, Johanns urged Congressional members to revise the programs in 2007.

Meanwhile, Senate Agriculture Committee Chairman Saxby Chambliss (R-Ga.) warned that it would make it more difficult to guarantee funding for farm programs without the extension.

Cattlemen Challenge EU

The National Cattlemen’s Beef Association (NCBA) is urging negotiators from World Trade Organization (WTO) member countries to support the U.S. Proposal for Global Agricultural Trade Reform, the organization reports.

NCBA’s focus has been on trade barriers in the European Union (EU), says NCBA Chief Economist Gregg Doud.

Currently, the EU’s bound tariff on beef imports is at 57%. Unlike free trade agreement negotiations, where tariff rates would be reduced to zero over time, these multilateral negotiations focus on reducing WTO-bound tariffs, which are the maximum tariff rates that WTO members may impose on imports. The average global tariff on exported beef and beef products is at 85%. The United States’ October proposal would potentially reduce bound tariffs to around 7.5% to 12.5%.

This week, United States Trade Representative Rob Portman and members of the U.S. negotiating team in Hong Kong are stressing that improved agricultural market access is a top priority.

“NCBA supports efforts made by U.S. negotiators to get tariffs down to a level where the world’s consumers can enjoy the most competitively priced, high-quality beef in the world,” Doud says. “This is a once-every-twenty-years opportunity, and we cannot afford for it be squandered. Our message to the negotiating teams is simple: The future success of our industry depends upon fair and transparent expansion of access to consumers around the globe.”

For more information on the U.S. Proposal for WTO Agriculture Negotiations, visit www.ustr.gov.

— Release provided by NCBA.