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Today's Top StoryU.S. and Brazil Settle Decade Old Cotton Case; GSM Program Insulated
WASHINGTON, DC -- The U.S. Department of Agriculture (USDA) and the U.S. Trade Representative (USTR) announced today that that the United States and Brazil have reached an agreement to settle the longstanding cotton dispute in the World Trade Organization (WTO).
According to the USDA, Brazil will drop the cotton case and has agreed not to bring new WTO actions against U.S. cotton support programs while the current Farm Bill is in place, or against agricultural export credit guarantees under the GSM-102 program as long as the program is operated consistent with the agreed terms.
Under the agreement, the U.S. government will make a $300 million payment to the Brazilian Cotton Institute and in turn the Brazilian government will give up its right to impose retaliatory tariffs on $830 million in U.S. products.
The USA Rice Federation joined several agricultural export groups in a joint statement of support of the settlement.
"We believe the settlement negotiated provides a positive path forward for both countries...[and]...removes the threat of retaliation against U.S. exports and provides certainty to U.S. producers and exporters of U.S agricultural products," the statement reads.
It continues, "[t]he GSM export credit guarantee program remains vital to ensuring the smooth operation of agricultural export markets....Most importantly, the settlement preserves the program for times when the capital markets become constrained, as they were in 2008, and when purely private sources of export financing become far more limited."
Groups joining USA Rice in signing onto the statement included the American Farm Bureau Federation, American Soybean Association, National Council of Farmer Cooperatives, North American Export Grain Association, U.S. Grains Council, and U.S. Wheat Associates.
Photo caption: In high cotton