Alan Beattie reported in yesterday's Financial Times that, "Another casualty of the suspension of the Doha round of global trade talks could be the long-awaited reform of American farm subsidies. Reformers are worried that the absence of Doha as an incentive to change will tip the balance back towards the expensive and inefficient status quo."

Mr. Beattie noted also that, "Given how removed they now are from their original intent, American farm subsidies are remarkably resistant to reform. When created as a relief programme for embattled farmers during the Great Depression, the regime spread support by stabilising prices of a small number of 'programme commodity' crops, including wheat, rice, corn, cotton and soy, of which most small farmers then grew at least one."

"A report published this week by the Chicago Council on Global Affairs put the case for switching farm spending towards conservation programmes and helping to protect all farmers from fluctuating income, not picking out a few favoured commodities," the FT article said.

"For campaigners this is a grim prospect. Ken Cook, head of the Environmental Working Group, which campaigns for farm subsidies to be redirected to conservation, says the Bush administration could well repeat the fiasco of the 2002 farm bill when it was forced meekly to abandon its own reform-minded draft bill in favour of a more traditional and generous version."

And in conclusion, the FT article noted that, "Robert Thompson, professor of agricultural policy at the University of Illinois and co-chair of the Chicago Council report, wrote recently that the combination of overall federal budgetary pressures, the threat of litigation and public disquiet over the inefficiency of farm subsidies were all arguments for change.

"But overall he expected inertia to win out. 'If I were a betting person,' Prof Thompson said, 'I would wager that the 2007 farm bill will look a lot like the 2002 farm bill.'"

Peter Shinn reported yesterday at the Brownfield webpage that, "The U.S. won't give any ground in the Doha Round of World Trade Organization (WTO) talks unless Europe does more to open up its markets to U.S. ag exports. That's what Senate Ag Committee Chairman Saxby Chambliss told reporters after a meeting yesterday in Washington D.C. with European Union Chief Trade Negotiator Peter Mandelson.

"'When they give us true market access, then I think you will see some movement on this,' Chambliss said. 'But to date, as we told Mr. Mandelson today, we simply don't think the offer they've made is commensurate with our significant reduction in domestic support proposal.'"

Reuters writer Richard Waddington reported yesterday that, "The World Trade Organization (WTO) launched a probe on Thursday into whether the United States has dismantled huge subsidies to its cotton farmers that have been ruled illegal.

"The move was sought by Brazil, which says Washington has not complied fully with a landmark 2004 verdict in which the Geneva-based trade referee decreed part of the multi-billion dollar U.S. cotton support program broke global trade rules and demanded sweeping changes."

Mr. Waddington added that, "The investigation will take at least 90 days. If it wins, Brazil could be entitled to levy billions of dollars of retaliatory sanctions against U.S. goods.

"'The implementation measures that it (the United States) has adopted fall far short of compliance,' said Brazil's ambassador to the WTO Clodoaldo Hugueney.

"But the United States insisted that it had made the needed reforms and that its policies were in line with WTO rules."

Concluding, the Reuters item stated that, "'The U.S. talking point for the last couple of years is that 'it's better to negotiate than to litigate' ...(but) ... there are no negotiations going on now,' said Gawain Kripke, senior policy analyst for Oxfam America.

"According to Oxfam, U.S. subsidies to the country's 25,000 cotton farmers totaled $5 billion in 2005 for a crop that was worth less than $4 billion."

An Associated Press article posted today at the Los Angeles Times webpage indicated that, "Brazil alleges that the U.S. has retained its place as the world's second-largest cotton grower because Washington paid $12.5 billion in subsidies to American farmers from August 1999 to July 2003.

"The United States is the world's second-largest exporter of cotton after China. Brazil is fifth."

And Dow Jones writer Kenneth Rapoza reported yesterday that, "A ruling in favor of Brazil could also influence the U.S. farm bill, which comes up for renewal next year and sets farm policy for 2007 to 2011."