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Serving: United States
Corn+Soybean Digest

USDA Changing Cotton Export Programs

USDA is making changes in three export credit guarantee programs as the first stop on the long road to complying with the World Trade Organization (WTO) ruling in the case brought by Brazil against the U.S. cotton program.

Agriculture Secretary Mike Johanns says USDA will alter the Export Credit Guarantee Program (GSM-102), the Intermediate Export Credit Guarantee Program (GSM-103) and the Supplier Credit Guarantee Program (SCGP).

He also says the Bush administration will ask Congress to make statutory changes in Step 2 of the Three-Step Competitiveness program for cotton as part of its overall response in the Brazilian case.

“By implementing these changes, we ensure continued U.S. leadership in the WTO Doha negotiations as we work toward an ambitious outcome that will be beneficial for U.S. agriculture,” says Johanns.

The proposed statutory changes would eliminate the Step 2 program, remove a 1% cap on fees that can be charged under the export credit programs, and terminate the Intermediate Export Guarantee Program (GSM-103).

“We have worked closely with Congress and our agricultural industries to respond to the WTO cotton decision,” Johanns says. “The export credit guarantee programs are one part of the WTO case. The administration continues to evaluate other steps that could be taken to respond to the WTO cotton decision.”

The announcements came as press reports said Brazil was expected to file a request with the WTO for retaliation rights in the case against the U.S.

Details of the changes to the export credit guarantee programs can be found on the Foreign Agricultural Service Web site at

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