The WTO-mediated U.S.-Brazil Framework Agreement could be in jeopardy if Brazilian growers are not given more latitude in how they use the $500-million already paid to the Brazilian Cotton Institute (BCI), according to a missive by the National Cotton Council of America.
A Brazilian grower delegation traveling in the United States this week reportedly implied that trade retaliation could ensue if Congress does not make acceptable reforms in the pending Farm Bill that allow Brazilian growers to use the funds more broadly.
In an unexpected twist, the Brazil delegation implied to media outlets that, in addition to the negotiated changes to bring the U.S. cotton program into compliance under the WTO decision, payments to BCI should continue beyond the agreed $500 million, thereby altering the carefully-negotiated agreement.
“The comments by the Brazilian growers that they would support retaliation are deeply disappointing to U.S. growers who have delivered significant policy reform, supported further modifications to the cotton provisions, supported the request to expand authority to use the nearly $500 million already transferred to the BCI, and supported maintaining the Framework Agreement,” stated the National Cotton Council of America (NCC) in a press release.
The NCC statement continued, “The U.S. cotton industry is prepared to accept, and in fact, has promoted major policy reforms to settle the longstanding dispute. Further, the U.S. industry is willing, on final settlement, to make good its commitment to cooperate with the Brazilian industry. In addition, the U.S. industry supports the reinstatement of the Framework Agreement.
“But, it is time for the Brazilian industry to acknowledge that the new cotton insurance program is substantial reform.”