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The Rural Voice, 1990-09, Page 16"Pride Has My Inoculant" R. R. #1 Elora "No spoilage when feeding AgMaster treated high moisture corn from an anon top sito." AgMaster High Moisture Com hioctilant PRIDE HAS YOUR INOCULANT. CALL YOUR PRIDE DEALER. PRIDE BRAND SEEDS P.O Box 1088. Chatham. Ontario N7M 5L6 1-800-265-5280 12 THE RURAL VOICE GRAIN MARKETS A U.S. PERSPECTIVE: The following article is an editorial comment from Feedstuffs, July 16, 1990, dealing with the future of world agricultural trade from a U.S. perspec- tive. Clearly, the world is moving to more free trade. The recent Houston (Texas) summit result was a call for reducing production and export subsidies as well as border controls. The details are all left to be worked out. In fact, so far the major traders have only framed the debate. The last hold out, The European Community (EC), has now at least agreed to enter the debate by establishing its position through the compromise. The U.S. will not see a total elimina- tion of all trade -distorting practices. The EC won't have to eliminate its export subsidies. For that matter, though, neither will the U.S. The summit participants agreed July 11 that all categories of trade -distorting practices, including subsidies to pro- ducers, subsidies to exporters, and im- port controls, will be treated separately, and all participants must show "substan- tial" and "progressive" reductions in each category. The participants appar- ently rejected a concept urged by the EC calling for an aggregate reduction, in which a country or other trading block could make deep cuts in one area to make up for minor cuts in another area. Although the U.S. is getting much of what it wants, it will also have to give up something under the compromise. Therefore, the question is, What will the U.S. give up in agriculture? One likely candidate is the U.S. sugar program, which artificially sup- ports domestic prices and has been called illegal by a General Agreement on Tariffs & Trade panel. Another strong possibility is dairy. The protec- tion given to U.S. dairy producers through restraints on imports could be reduced. Crop programs are likely to be af- fected, too, but only gradually. Sup- ports will come down, but over the course of a decade rather than a year or two. In exchange for these changes, the U.S. will see much more access to ex- port markets than ever before. Grain sales to Europe, which arc now pre - eluded because of the EC's variable levies, should begin to grow by 1992. Also, if EC export subsidies are re- duced, the U.S. should see more markets open up to it. Along with raw commodities, ex- ports of value-added products are likely to increase, including meat and poultry, as EC subsidies begin to fade. Overall, therefore, the effects on U.S. agriculture will be positive, despite some sector disruption. The U.S. had asked fora deadline for phasing out the trade distortions cur- rently in trade laws, seeking an end in 10 years to production subsidies and im- port barriers and in five years to export subsidies. The changes may not come that quickly, and, when they do come, they will come in stages. Each stage will bring an overall improvement in the U.S. agricultural sector. Red Meat and poultry production will increase, which will boost domestic demand for feed grains and other crops. The increased domestic demand will be matched by increased export demand, which will more than make up for any decreases in commodity price supports. At the same time, the U.S. will need to rely less on artificial programs to curtail crop production. With any luck, the acreage reduction programs will become relics. Also, with any luck, the need for certificate programs to get grain out of high-priced, high-cost government stor- age programs will also vanish, as the government's involvement controlling commodity surpluses diminishes. The outcome, if the world trade talks remain on track, will bean improvement for all livestock, except perhaps dairy, crop producers, and the feed industry. When complaints are raised about sacrifices that some segments of U.S. agriculture must make for the compro- mise agreement, those complaints should be kept in perspective. The changes will come gradually, and the benefits — of more production, possible higher prices and more common sense in U.S. farm programs — will far out- weigh the drawbacks.0 This information is supplied by Dave Gordon, London Agricultural Com- modities, Inc. in Ilyde Park, 519-473- 9333 or 1-800-265-1885.