Dumping Booms during WTO's First Decade
Ten years after the enactment of the World Trade Organization's Agreement on Agriculture, U.S. food companies are still exporting crops at prices below their cost of production—dumping—onto world markets, finds a new report by IATP.

WTO Agreement on Agriculture: A Decade of Dumping—United States Dumping on Agricultural Markets looks at export dumping from U.S.-based food companies onto world agricultural markets. The analysis provides dumping calculations from 1990-2003 for five commodities grown in the U.S. and sold on the world market: wheat, corn, soybeans, rice and cotton.

The report found that wheat was exported at an average price of 28 percent below cost of production, soybeans at 10 percent, corn at 10 percent, cotton at 47 percent and rice at 26 percent.

The report found that dumping levels increased significantly for every commodity after the passage of the 1996 Freedom to Farm bill, which produced a vast structural, price-depressing oversupply of major agricultural commodities.

The full report and a one-page fact sheet are available at iatp.org.

WTO Cotton Ruling Stops Short of Ending Dumping
The WTO Appellate Body ruled parts of the U.S. cotton program are illegal under international trade rules. While the ruling will do little to stop the harmful practice of dumping agricultural exports at below the cost of production, it will increase pressure on the United States to reform its national farm programs, says IATP.

Although the ruling may impact some aspects of the U.S. cotton program, overall it will likely have little effect on dumping by U.S. agribusinesses for several reasons:

1. The negotiations for a revised WTO Agreement on Agriculture open the door to allow the continuation of many U.S. farm subsidies ruled illegal by the Appellate Body.

2. Many factors not included in the WTO ruling impact the global price of cotton, such as the price of other fibers, the price of oil for oil-derived textiles and the shift of textile mills outside of the U.S.

3. If government payments to U.S. cotton growers are cut, cotton production would likely shift to other crops like corn, contributing to higher levels of dumping in those commodities.

To read more about the case and its implications, go to tradeobservatory.org.

Minnesota and Kyoto
When the Kyoto Climate Change Treaty went into effect on Feb. 16, it did so without the ratification of the world's largest emitter of greenhouse gases: the United States. "This is unfortunate, since U.S. ratification of Kyoto would have enormous economic benefits, particularly for our family farmers, our forest products industry, and for our renewable energy-producing companies," writes IATP President Mark Ritchie in a commentary appearing in Minneapolis's Star Tribune.

Ritchie writes, "Minnesota's family farmers are playing a major role in building a cleaner, renewable energy future. There are now over 800 wind turbines across the state, largely on agricultural land, providing 595 megawatts of power—enough to power every household in Minneapolis. Minnesota's farmers are also leaders in the biofuel sector, with a growing number of farmer-owned ethanol and biodiesel facilities. There are currently 13 ethanol plants in Minnesota, with three more under construction, and three soy diesel plants in the works. With growing demand by consumers to be more energy efficient and climate friendly, there will be mounting demand for these environmentally friendly fuels."

Read the full commentary at iatp.org.

The High Cost of Mercury
"We have a big problem: widespread mercury pollution is contaminating our waters, our fish and poisoning our children. The environmental and health damages caused by mercury have been fairly well documented. Now, for the first time, we are learning more about the financial costs of mercury exposure," write IATP Food and Health scientist Kathleen Schuler and Christopher S. Williams, MD.

Mercury is present at some level in all Minnesota lakes, rivers and streams. The Minnesota Department of Health has issued statewide fish consumption advisories due to mercury contamination. Mercury is a potent brain toxin that can cause reduction in IQ, as well as learning and developmental problems in children exposed to even low levels of methylmercury, the kind of mercury found in fish.

Schuler and Williams write, "What's the economic impact on Minnesota? We calculate an annual cost of $156.6 million for Minnesota, with an estimated $23.4 million attributable to power plant emissions. Who pays these costs? The answer is—all of us—as individuals and as taxpayers."

Read the full commentary (PDF)

CAFTA Would Hurt U.S. Farmers
According to IATP Director of Trade and Agriculture Dennis Olson, the Central American Free Trade Agreement would wreak havoc on the U.S. sugar program, leading to higher government payments and increased levels of dumping. Olson testified before U.S. Rep. Collin Peterson (D-Minn.) at a congressional field hearing in St. Cloud.

Sugar is the last remaining comprehensive supply and inventory management program still in place after the 1996 "Freedom to Farm" bill finished deregulating all other major farm program crops. As such, the sugar program is the only major U.S. commodity program that prevents dumping on the world market at below the cost of production. It is also the only major farm commodity program that operates with virtually no direct government subsidy payments.

If CAFTA is passed, "the U.S. sugar program will have been sacrificed on the altar of trade liberalization," Olson testified.

Read Olson's full testimony at tradeobservatory.org

Preparing for Hong Kong Ministerial
IATP is gearing up for a major presence at the WTO Hong Kong ministerial, scheduled for December 2005. IATP's Trade Information Project Associate Carin Smaller attended a February civil society meeting in Hong Kong to plan and coordinate activities running up to the ministerial. The meeting was hosted by a newly formed coalition, the Hong Kong Peoples Alliance on the WTO. Around 250 people from 23 countries—representing 110 civil society groups, social movements and labor unions—attended the meeting.

The meeting included updates on what is happening in the Doha negotiations, trade union concerns about the impact of WTO negotiations on labor and services, civil society concerns with the WTO agenda and accession process.

IATP is planning to co-host a fair trade fair and symposium similar to the one held in Cancún during the last ministerial. The fair will focus on the consumer and showcase a range of different cuisines.

To follow events leading up to Hong Kong, go to tradeobservatory.org.

Corinne Rafferty Joins IATP
In January, Corinne Rafferty joined IATP as the organization's Program Coordinator. She comes to IATP with a long history of work with partner organizations, including Farmers' Legal Action Group, where she served as executive director, and the Minneapolis office of the Institute for Local Self-Reliance, where she worked on project development.

A lawyer by training, Corinne lived in San Francisco and New York before being lured to Minnesota in 1994. While living in New York in the 1980s, she co-founded and co-directed Nicaragua Exchange, a national organization that sent more than 1,500 U.S. citizens to Nicaragua to pick cotton and coffee and helped mobilize opposition to U.S. funding of the contra war. She also worked as a program officer for both the Rockefeller Family Fund and the Unitarian Universalist Veatch Program, advising their environmental, farm and globalization funding.

At IATP, Corinne will have responsibility for program oversight and coordination—a task that should make good use of her management and communication skills. Corinne can be reached at crafferty@iatp.org.

IATP Gets Highest Rating from Charity Navigator
IATP received a four-star rating, the highest possible, by Charity Navigator. The nonprofit Charity Navigator helps charitable givers make intelligent giving decisions by providing information on over 3,700 charities and by evaluating the financial health of each of these organizations.

Read Charity Navigator's evaluation of IATP

eLearning Partners with Philippines; China Next
The World Trade eLearning Center, a joint venture between IATP and the Earth Council, has partnered with the International Trade Group of the Department of Trade and Industry (DTI) to offer a comprehensive training program on the World Trade Organization to mid-level trade policy staff of the Philippine government. The first phase of courses—called "The WTO Literacy Program"—has already trained over 200 government employees and stakeholders from business and civil society about the multilateral trading system, international trade law and the functioning of the World Trade Organization.

Dita Angara-Mathay, Special Trade Representative of the DTI, hosted the first graduation ceremony for course participants in Manila on March 11 and believes that e-learning is one of the most important new opportunities for developing country trade negotiators. From Angara-Mathay's perspective, "Developing the capacity of government and public stakeholders is critical to the development of sound trade policy. The skills and knowledge that are being developed by this program apply to both multilateral and bilateral trade regimes. Even while bilateral trade agreements are being forged, having a sound and consistent global trade policy is critical to a country sustainable development strategy."

China will be the next country where these courses will be offered. For more information, contact Mark Ritchie.

Water Use a Major Issue at UN Meeting
Water, sanitation and human settlements were the focus of the Intergovernmental Preparatory Meeting to the 13th Session of the United Nations Commission on Sustainable Development held in New York between Feb. 28 and March 4.

IATP's Senior Associate Shiney Varghese (pictured above), also co-chair of the Freshwater Caucus at UNCSD, played a key role along with several other caucus members in providing inputs on behalf of nongovernmental organizations to the UN commission. Varghese was selected to make the NGOs' opening statement on Feb. 28 before the UN commission.

Leading up to the meeting, the NGO delegation had prepared a backgrounder to the Secretary General (read the backgrounder). In response to the Secretary-General's paper on freshwater, the Freshwater Caucus co-chairs developed a set of priority points for action. Read the NGO opening statement and priority points on freshwater (PDF).

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IATP News is an occasional publication reporting on recent events and activities at the Institute for Agriculture and Trade Policy (IATP). It is sent to board members, supporters, partners and friends. If you want to learn more about any particular item or if you do not want to receive this newsletter, send email to Communications Coordinator Ben Lilliston at blilliston@iatp.org or call: 612-870-3416. Your comments and suggestions are appreciated.

Institute for Agriculture and Trade Policy (IATP)
Mark Ritchie, President
2105 First Avenue South Minneapolis, Minnesota 55404 USA
Tel. 1 (612) 870-0453 Fax. 1 (612) 870-4846
Email: iatp@iatp.org Web: iatp.org