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U.S. negotiators maintain grain export opportunities to Europe

WASHINGTON — The Bush administration has reached an agreement that maintains future export opportunities for U.S. feed grains to Europe. While the European Commission sought for several months to impose quantitative restrictions on grain imports, U.S. negotiators successfully fought to preserve Europe's margin of preference (MOP) system for all feed grains except barley.

"Under the leadership of U.S. Trade Representative Robert Zoellick and Chief Agriculture Negotiator Allen Johnson, the United States stood firm and held the European Commission to its previous commitments negotiated in the Uruguay Round," said Kenneth Hobbie, U.S. Grains Council president. "Europe's failure to adhere to these commitments would have sent the wrong signal to U.S. grain producers and exporters, especially at a time when our access to the European market is already severely hampered by Europe's illegal moratorium on approvals of products of biotechnology."

To stem the influx of large quantities of feed wheat into Europe from the Black Sea region, the European Commission sought to withdraw its MOP concessions, which allow tariff-only treatment for feed grains and wheat. The withdrawal of the MOP would have closed off future export opportunities for U.S. feed grains to the European market.

"We had serious concerns about Europe trying to solve an internal problem through international negotiations, particularly when we are striving to move forward with trade liberalization under the Doha Round," Hobbie said.

The agreement will leave in place Europe's MOP commitments for imports of durum wheat, high?quality common wheat, corn, rye and sorghum. The European Commission also committed to allow imports of up to 50,000 metric tons of malting barley per year at the import duty of 8 Euros per metric ton. For varieties of barley other than malting barley, the Commission will allow imports of up to 300,000 metric tons per year at a duty of 16 Euros per ton. This agreement allows the United States to maintain barley exports to the European Union at low, bound duties.

"We still have significant issues to resolve with Europe regarding market access for U.S. feed grains. However, the progress our negotiators made on the MOP issue bodes well for future talks," Hobbie said.

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