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UPI Farming Today

By GREGORY TEJEDA, United Press International   |   Feb. 12, 2003 at 1:15 AM   |   Comments

Study says U.S. undercutting farm markets

A new study contends the United States is dumping five primary farm commodities onto international global markets in violation of World Trade Organization rules.

The Institute for Agriculture and Trade Policy released its study one day prior to the scheduled Wednesday release of a draft of new agriculture trade rules.

On Friday, several countries are expected to send negotiators to a gathering in Tokyo to review the draft, as well as discuss progress on other World Trade Organization negotiations.

The study looks at the cost of production for corn, soybeans, cotton, wheat and rice.

It found all commodities were sold below the cost of production -- a practice known as export dumping. The study claims some farmers are selling their crops for prices up to 40 percent below the cost of production.

"The dumping of commodities on international markets hurts farmers all over the world, including U.S. farmers, by driving down the marketplace price," institute President Mark Ritchie said.

"There are international trade rules to address this problem," Ritchie said. "They need to be enforced."

The study reviewed costs for the commodities using information from the Agriculture Department and the Organization for Economic Cooperation and Development in order to compare the cost of production with export price.

Dumping levels were around 40 percent for wheat, 25-30 percent for corn and approaching 30 percent for soybeans.

Cotton dumping levels, which were as high as 57 percent in 2001, were higher for 2002, by about 20 percent.

The study found that structural price depression can drive farmers in developing countries out of their local markets. It also can find farmers who sell their products to exporters finding their share undermined by lower-cost competition.

The study found some countries are trying to deal with the problem by conducting their own investigations into whether some U.S. agricultural exports are harming prices.

Brazil is considering filing a complaint with the World Trade Organization against the U.S. cotton industry. In 2001, Canada imposed countervailing and anti-dumping duties on U.S. corn imports.


Feds support Americas free trade proposal

Agriculture Secretary Ann Veneman said Tuesday a Free Trade Area of the Americas would boost trade and economic development throughout the Western Hemisphere -- which would boost opportunities for farmers and livestock ranchers.

"It is an aggressive and bold plan that once again shows this administration's commitment to open and competitive markets," Veneman said.

The proposal is meant to reduce existing rules that serve as barriers to trade between the nations of the North and South American continents.

Veneman said her staff will assist the U.S. Trade Representative's office while negotiations on agricultural issues take place.


Mexico tries to negotiate farm policies

Academic, agriculture and government officials converged on Mexico City as President Vicente Fox began negotiations this week on how the government could help Mexico's farmers.

Fox said he wanted members of his Cabinet to meet with agriculture industry officials, so that both sides could appreciate the others concerns as the Mexican government tried to establish policies to benefit local farmers.

Several farm-related groups of a more activist bent refused to participate in this week's talks, although those officials said they may come to future talks. Fox has said he wants Mexico to spend $11.7 billion on farm programs this year.


Mice shut down pecan facility

Georgia Agriculture Department officials shut down a Camilla, Ga., pecan storage facility because of a severe mouse infestation.

Officials said nearly 1.5 million pounds of unshelled pecans were being withheld from sale, and all may have to be destroyed because of the contamination.

Nuts had been kept in two cold storage units belonging to Camilla Commodity Services Inc. The nuts themselves were owned by Southwest Nut Co. of Fabens, Texas.


Valentine candy profits not going to farmers

Sugarcane growers claim they're not the reason why Valentine's Day candy prices are on the rise.

The American Sugar Alliance cited figures from the Agriculture Department and Bureau of Labor Statistics showing the wholesale price for refined sugar has declined by 12 percent since 1996 -- while the price of candy rose 10 percent.

The American Sugarbeet Growers Association also noted that the price on sugar-containing products is on the rise, with sugar itself increasing by 3 percent on supermarket shelves.


Prices mixed on CBOT

Grain futures were mixed at the close Tuesday on the Chicago Board of Trade.

Soybeans rose on a weaker-than-expected Brazilian soybean production report.

Corn was virtually unchanged on the USDA supply-demand report, which showed no sudden declines in the crop.

Wheat fell on a lack of any positive information.

Oats were higher.

The prices:

Soybeans: Mar 5.72 up 7 1/4, May 5.70 1/4 up 7 1/4, Jul 5.68 1/4 up 7 1/4, Aug 5.60 up 6.

Corn: Mar 2.41 1/2 unch, May 2.44 3/4 up 1/4, Jul 2.46 1/4 unch, Sep 2.45 1/2 unch.

Wheat: Mar 3.30 off 4 3/4, May 3.32 off 3 1/4, Jul 3.25 1/2 off 2, Sep 3.29 off 1 1/2.

Oats: Mar 2.14 3/4 up 3 1/4, May 2.02 up 3 1/2, Jul 1.91 up 2 3/4, Sep 1.73 1/2 up 4 1/4.

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