12/23/08 International trade and U.S. ag in 2009

Farm and Ranch December 23, 2008 A slowing world economy will mean reduced demand for U.S. agricultural products in 2009, but it may also mean an increase in protectionism. That potential was expressed by Michael Whitehead of Rabobank during a recent teleconference with reporters. Whitehead: "In 2009, in response to the worsening economic sector, it is likely we will see many countries impose tariff rises. Now the World Trade Organization says it will increasingly monitor these and report these, but it will have a fight on its hands. For many countries as they change to protect their domestic agricultural markets, their domestic social stability, and their domestic food security, by perhaps going back toward some of the trade restrictions we thought we had seen the end of in the past." Whitehead says the U.S. is also likely to see challenges through the World Trade Organization on its agricultural policy. Whitehead: "Particularly cotton, corn, sugar and ethanol are likely to see some kind of challenge. These are likely to be primarily supported by Brazil but be supported by producers. And American farmers know full well that past actions in the WTO have been successful. Perhaps the best example of this is the challenge against the U.S. step two cotton export program, which was challenged and abolished as a result of that." Long term Whitehead says population growth will be good for U.S. agriculture demand but he also notes that over the past forty years U.S. market share of major commodities like wheat, corn and soybeans, has been declining. I'm Bob Hoff and that's the Northwest Farm and Ranch Report on the Northwest Ag Information Network.