$350 Billion In Subsidies To US Farmers

Trade delegations in Washington admitted defeat yesterday in their efforts to stop the U.S. from handing more than $350 billion in subsidies to its farmers. Maree Howard reports.

Hard on the heels of a U.S. move to apply import tariffs on steel, a trade delegation led by Australian Agriculture Minister, Warren Truss, has spent two days trying to convince the U.S. Congress to change its planned Farm Bill.

Under the Bill, which goes before the U.S. Senate today, U.S. farmers will be paid to produce goods no matter the world price or demand.

Global dairy, citrus and sugar farmers will face the biggest threat from government-assisted U.S. farmers, although wheat and other broadacre crops will also face trouble.

Mr Truss said the decision of Congress to go ahead with the Farm Bill was bad for both Australian and world trade.

He said U.S. farmers were becoming less innovative and less prepared to adapt to world demand.

"We are especially concerned at the clear intent of the farm lobby to seek to entrench a mentality of farm subsidies in the USA," he said

Mr Truss says another problem was that the Bill undermined a new round of world trade talks.

He said while the U.S. had legitimate concerns about subsidies from the European Union, U.S. farmers were now getting more assistance than their European counterparts.

The $350 billion of subsidies in the Farm Bill will also affect New Zealand producers and is planned to stand for 10 years.

Australian Labour Opposition industries spokesman, Kerry O'Brien said " The Prime Minister should have given this matter much higher priority but he failed to do so and Australian (and NZ) farmers are the ones who will have to pay for his inaction."

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