NCC Praises USTR’s Filing of Appeal in U.S.-Brazil Cotton Case

NCC Chairman Larry McClendon praised the US Trade Representative’s Office for filing a notice of appeal in the WTO Brazil – US cotton case.

February 13, 2008
Contact: Marjory Walker or T. Cotton Nelson
(901) 274-9030

MEMPHIS –  National Cotton Council Chairman Larry McClendon today praised the U.S. Trade Representative’s Office for filing a notice of appeal in the World Trade Organization Brazil – U.S. cotton case.

“We appreciate the action of the Trade Representative’s office and we look forward to working with them to reverse the compliance panel’s ruling against U.S. cotton,” McClendon said. “It is difficult to understand how the United States could be deemed to be depressing world prices of cotton when world prices are rising, U.S. production is declining and expenditures under the cotton loan program have fallen to zero for 2007 and are expected to continue to be small or non-existent.”

McClendon noted that as U.S. production has declined, production and exports from Brazil and India have increased to take its place in the world market and China’s domestic production also has increased – benefiting from trade barriers that keep internal prices high.

“I have trouble with countries blaming the United States for depressing world market prices, while at the same time, they are expanding their production and exports,” the Marianna, AR, cotton ginner and producer stated.

McClendon said the U.S. cotton industry also hopes this appeal will lead to better clarity in the WTO panel decisions.

“We have seen three panels state that the U.S. cotton program was causing significant price suppression,” he said, “but not one of those rulings has remotely quantified what they thought was ‘significant.’ We have no workable standard – even after three panel decisions. We believe that the U.S. cotton program has never had any more than a minimal impact on world cotton prices.”

The U.S. cotton industry provides employment for some 440,000 Americans and generates more than $120 billion in annual economic activity. As the industry’s unifying force, the Memphis-based National Cotton Council has a mission of ensuring all seven U.S. cotton industry segments’ ability to compete effectively and profitably in the raw cotton, oilseed and U.S.-manufactured product markets at home and abroad.