Trade agreements, either completed, ongoing or in some netherworld of uncertainty, will offer little, if any, advantage to peanut growers and some agreements likely will come with significant downsides.
“We see nothing positive for peanuts in the WTO,” Evans Plowden, American Peanut Shellers Association, said Monday during the Southern Peanut Growers Federation annual meeting in Panama City, Fla.
“We already have access to our important markets, so there are not a lot of barriers to break down for peanut trade.”
That statement comes with one caveat, however. Plowden said failure to negotiate a reasonable WTO agreement could mean more cases similar to the Brazil cotton case (in which a WTO panel found in favor of Brazil and forced changes in the U.S. cotton program). “If other (commodity) programs have problems, so will peanuts, eventually. We could see pressure to change the peanut program.”
The United States hopes for a WTO agreement that gives “wide open access or at least better access to world markets,” Plowden said.
Plowden said other agreements also may affect peanuts. “CAFTA (Central America Free Trade Agreement) is completed though not all parties are fully implementing it,” Plowden said.
Under that treaty, Nicaragua, a peanut producing nation, would have immediate access to U.S. markets. Peanut trade advisers have “been able to get the longest allowable staging time (the time which an agreement is in full compliance), 12 years,” in most trade talks, Plowden said.
He said the Free Trade Agreement of the Americas (including much of South America) “is going nowhere,” for now, but could have serious ramifications for peanuts if it is ever finalized. That agreement would grant several peanut producing nations, including Brazil, access to U.S. markets.
“Our market eventually would be wide open,” Plowden said.
He said WTO negotiators have made “no significant progress” on an agreement. “They have missed several deadlines and it is critical to get that agreement done this year. The president's trade promotion authority ends in mid-2007. That means the president can negotiate agreements and Congress must vote up or down on them. Congress can add no amendments.”
Plowden said that authority becomes crucial when trade negotiators deal with several countries. Amendments, he said, would create nearly impossible obstacles to passage.
Crops for fuels, Plowden said, also could affect the way U.S. agriculture views trade agreements. Commodities for fuel could take come pressure off the need for increased market access. He said peanuts and cotton may not play into that scenario but corn and soybean interests could change.
He said estimates indicate as much as 20 percent of the U.S. corn crop could go into ethanol production and 12 percent of soybeans could be used for bio-diesel. “That may change the importance of market access for (these crops).”
Plowden said the peanut industry, including farmers, shellers and manufacturers, remain united in their goals. “What's good for peanut farmers is good for the peanut industry,” he said.