Thursday, November 09, 2006

US election results not good for trade

Whatever other benefits they bring, the US election results are not good news for agricultural trade. Protectionist sentiment in the Congress has undoubtedly been strengthened and Trade Promotion Authority is likely to be renewed. This makes a Doha Round settlement less likely, removing a key pressure for CAP reform.

The next chair of the agriculture committee in the House is likely to be Minnesota congressman Collin Peterson. His constituency has a strong representation of corn and sugar beet farmers, two crops that have the most to lose under changes to the farm bill backed by agriculture secretary Mike Johanns. He is likely to oppose efforts to change American's generous farm subsidies, thereby weakening incentives for the EU to give ground.

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