USDA yesterday reported Brazil had reached a decision regarding the ongoing WTO cotton dispute which would avert the imposition of countermeasures of more than $800 million this year.
This includes more than $560 million in countermeasures against U.S. exports which were scheduled to go into effect Monday, as well as possible countermeasures on intellectual property rights that could have taken effect later.
The findings in the cotton dispute concern U.S. cotton support under the marketing loan and countercyclical payment programs, and the GSM-102 Export Credit Guarantee Program.
In line with these findings, the framework on the latest agreement has two major elements.
First, it would provide, as a basis for a discussion toward reaching a mutually agreed solution to the dispute, a limit on trade-distorting cotton subsidies.
Second, the framework would provide benchmarks for changes to certain elements of the current GSM-102 program.
The United States and Brazil would meet quarterly to discuss the successor legislation to the 2008 farm bill as it relates to trade-distorting cotton subsidies and the operation of GSM-102.
The framework, reported USDA, would not serve as a permanent solution to the cotton dispute, but it would provide specific interim steps and a process for continued discussions to reach a solution to the dispute.