U.S. Senate Passes Several
Ag Trade-Related Measures

WASHINGTON —(AP)— The Senate last week approved an amendment by Sen. Kent Conrad, D-N.D., that directs negotiators at the upcoming World Trade Organization talks in Seattle to seek concessions for American agriculture.

The amendment, cosponsored by Sens. Chuck Grassley, R-Iowa, Tim Johnson, D-S.D., Mike Enzi, R-Wyo. and John Ashcroft, R-Mo., tells negotiators to seek the following goals:

— The elimination of all export subsidy programs;

— Discipline European Union farm policies so they no longer distort world markets;

— Regulate state trading enterprises, such as the Canadian Wheat Board;

— Insist that ``unfounded fears about the safety of U.S. food exports'' not be used as trade barriers;

— Require other countries to reduce their tariffs to U.S. levels and eliminate other barriers to U.S. exports;

— Encourage cooperative policies to avoid price-depressing surplus production or food shortages;

— Strengthen enforcement of existing rules.

The amendment was added to a bill encouraging greater trade with Africa, which now goes to a House-Senate conference committee.

``The importance of this is we are laying out direction for trade negotiators for the WTO round,'' Conrad said. ``This has not been done before ... I think this sends a very important signal to negotiators, and to those with whom we are negotiating.''

In related action, agriculture would have a permanent advocate for trade under legislation that cleared the Senate and is headed for the House.

The legislation creating a chief agricultural negotiator is backed by the U.S. trade representative and dozens of farm groups nationwide and has been endorsed by the White House.

The measure formalizes the job now held by Peter Scher, who as deputy special trade representative for agriculture has played a key role in a nasty trade fight with the European Union over bananas and the battle over Canadian trade practices.

The bill's passage last week came in advance of the next World Trade Organization talks in Washington state.

Sponsors are Republican Sen. John Ashcroft of Missouri and Senate Democratic Leader Tom Daschle of South Dakota. Also, GOP Sens. Christopher Bond of Missouri and Pat Roberts and Sam Brownback of Kansas are among cosponsors.

In the House, it's being pushed by Rep. Kenny Hulshof, R-Mo.

Yet another related Senate measure would allow farmers to qualify for government benefits that now go to industrial workers who lose their jobs because of imported goods.

A provision in the Senate-passed African trade bill would allow farmers to qualify for up to $10,000 a year from the 37 year-old Trade Adjustment Assistance Program, if they can show imports contributed ``importantly'' to a drop in U.S. commodity prices.

Commodities that could qualify for the payments include pork, beef, cotton and some types of wheat.

``When President John F. Kennedy first envisioned the Trade Adjustment Assistance Program he said it should help farmers,'' said Sen. Charles Grassley, R-Iowa. ``The unfortunate reality is that family farmers never really qualify for the program.''

The average pork producer would have received $2500 last year if the provision had been in effect, according to Grassley's staff. Sen. Kent Conrad, a North Dakota Democrat who co-sponsored the provision, said it also could benefit farmers in his region who have been affected by imports of Canadian wheat.

The House doesn't have a similar provision in its version of the trade bill. It will be up to a House-Senate conference committee whether it stays in the final version of the legislation that comes out of Congress.

The payments would be triggered when commodity prices fall 20 percent below the average price for the previous five years and the Agriculture Department decides imports were an important factor in the decline.

Hog producers say imports from Canada contributed to a steep drop in pork prices last year. In December 1998, the price of pork fell as low as $8 per hundred pounds, down from $46.50 a year earlier.

Most of the price drop, however, was due to overproduction and lack of capacity in U.S. packers, said John Beghin, an agricultural trade specialist at Iowa State University. Only about five percent of the price decline could be blamed on competition from imports, he said in an interview.

He said the subsidies could wind up holding prices down by encouraging farmers to produce commodities that are already in surplus. Without such payments, producers could turn to something else.

``If it becomes another (permanent) subsidy to the farm sector I'm not sure it's a good thing,'' he said.

The Senate legislation would authorize Congress to spend up to $100 million a year on the farm payments. The money would come from changes in the way real estate investment trusts are taxed.

Last month, President Clinton signed into law $8.7 billion in emergency farm assistance to compensate farmers for low commodity prices and weather-related crop losses. Economists say the low prices are primarily due to lagging exports for U.S. commodities caused by financial problems in Asia and Russia.

President Clinton wants Congress to finish work on the trade legislation before the Nov. 30-Dec. 2 meeting in Seattle of ministers of the World Trade Organization.