The US cotton industry will wrestle with several trade issues in 2004 that could hurt the livelihood of the American cotton farmer, industry officials said Tuesday.
Those disputes range from a complaint filed by Brazil with the World Trade Organisation (WTO) accusing the US of subsidising its cotton producers to the demand by nations from Sub-Saharan Africa for Washington to eliminate cotton support programs.
"We continue to fight pressure from the international community to single out the cotton program in ongoing WTO talks," Robert Greene, the chairman of the US industry group National Cotton Council (NCC), said in a speech at the annual meeting of the US cotton industry here.
"You can see that our trade agenda is very crowded as any one of these issues could positively or negatively impact our livelihoods," he said.
Exporting cotton has become vital for the United States because domestic fibre consumption has shrunk over the past few years.
US consumption of cotton in 2003/04 was estimated by the US Department of Agriculture (USDA) at 6.2 million (480-lb) bales.
Just a few years ago, it stood at 11 million bales.
US cotton exports, on the other hand, have exploded. USDA estimated American cotton exports at a record 13.2 million bales in 2003/04. Last year, exports amounted to more than 11 million bales, up sharply from 6 million to 8 million bales a few years ago.
David Stanford of Plains Cotton Co-operative Association in Lubbock, Texas, said in a speech to delegates here that if the US continues to produce 16 million to 18 million bales of cotton a year, "10 million to 13 million bales will need to find a home in the international market."
The increasing importance of trade issues is illustrated by the case filed by Brazil against Washington.
The Brazilian complaint is being heard by a WTO dispute settlement panel whose preliminary finding is due out in the spring of 2004.
NCC President and Chief Executive Mark Lange said in a separate report that Brazil claims the US "holds a disproportionate share of the world raw cotton market and our subsidies must remain high because the US is a high-cost cotton producer."
He concluded, "I believe that this challenge ultimately extends beyond the US cotton program and is a fundamental threat to the conduct of US domestic agricultural policy."
Another issue is the demand by four African nations for the elimination of US and European Union cotton programs. The issue was eventually shelved when Washington proposed that all trade distorting policies in fibre production be taken up.
"This industry has repeatedly taken the position that it is willing to agree to fair trade rules governing agricultural programs and will join other commodities and other countries in agreeing to reductions in agricultural support. But we will not stand by while we are unilaterally and unfairly targeted," Lange added.
Other issues include US complaints of inadequate access for the American cotton industry to China, and opposition to the Central American Free Trade Agreement (CAFTA).
Looming in the background is a textile trade tiff between the US and China. In November, Washington slapped quotas on Chinese-made bras, bathrobes and knits. China cancelled a December trip to the US by a cotton-buying delegation.
Industry sources said the Chinese trip may not go through until after the Lunar New Year festivities on January 22.
The Beltwide cotton conference is the biggest annual meeting of the US cotton industry that features projections of supply and demand trends for the upcoming season.