Issues in agricultural trade policy proceedings of the 2014 OECD Global Forum on Agriculture

156 Pages·2015·2.86 MB·English

by  OECD

Issues in Agricultural Trade Policy
ProceedIngs of The 2014 oecd globAl forum on AgrIculTure
Issues in Agricultural Trade
Contents
Chapter 1. Issues in agricultural trade policy: An overview
Policy
Chapter 2. A re past OECD analyses of agricultural policy reforms relevant to current policy
and market settings?
Chapter 3. Current domestic policy settings in the context of past and potential international agreements ProceedIngs of The 2014 oecd globAl forum
Chapter 4. Review of the performance and impacts of recent stockholding policies on AgrIculTure
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Isbn 978-92-64-23388-1
51 2015 06 1 P

Issues in Agricultural
Trade Policy
PROCEEDINGS OF THE 2014 OECD GLOBAL
FORUM ON AGRICULTURE
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3
FOREWORD –
Foreword
This book brings together a collection of papers prepared for the Global Forum on Agriculture
which took place at the OECD in December 2014. It reviews current knowledge about agricultural and
agricultural trade policy settings and asks how pertinent that knowledge is in the light of profound
market and structural changes that have been taking place in the global agro-food sector in recent
decades. It aims to inform and assist policy makers and negotiators as they seek to overcome the
problems that have made the agricultural pillar of the Doha Agenda trade negotiations particularly
difficult. The data and analysis presented cover OECD and major G20 and emerging economies which
account for the great bulk of global food production, consumption and trade.
Chapter 1, prepared by Jared Greenville of the OECD Secretariat, provides a short overview and
synthesis of the main conclusions which can be drawn from the papers which make up the book.
Chapter 2, by Stefan Tangermann, Professor Emeritus at the University of Göttingen, examines the
validity of analysis undertaken by OECD since the conclusion of the Uruguay Round, in light of the
profound changes that have occurred in agricultural markets and policies in recent years. It asks in
particular whether earlier policy recommendations and analyses of reform impacts remain pertinent in a
world of higher and more volatile international prices, and where the role and influence of key emerging
economies is much greater than in the past. Chapter 3, by Lars Brink, Independent Advisor, examines
current policy settings in 20 major agricultural producing and consuming countries against their
Uruguay Round commitments and against the 2008 draft modalities drawn up in the context of the Doha
negotiations, with a view to gauging the degree of further reform effort that would be required to give
effect to the draft modalities in today’s policy and market environment. Finally, Chapter 4, by Annelies
Deuss of the OECD Secretariat, reviews recent experience in the use of buffer stocks and social safety
net stocks, mainly in emerging and developing countries, with a view to determining how effective they
have been in meeting their seemingly contradictory aims to raise or stabilise prices for producers while
lowering them for consumers.
A summary of the discussion during the Global Forum on which this proceedings volume is
based, as well as the presentations made during the Forum, are available from the Forum webpage
(http://www.oecd.org/agriculture/global-forum-agriculture-2014.htm).

ISSUES IN AGRICULTURAL TRADE POLICY: PROCEEDINGS OF THE 2014 OECD GLOBAL FORUM ON AGRICULTURE © OECD 2015

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TABLE OF CONTENTS –

Table of contents
Foreword ......................................................................................................................................................... 3
Chapter 1. Issues in agricultural trade policy: An overview ...................................................................... 9
1.1. Evolving agricultural markets ........................................................................................................ 10
1.2. The landscape of agricultural support policies has evolved ........................................................... 14
1.3. Do changes in agricultural markets require new principles for formulating future
agricultural trade and domestic policies? ...................................................................................... 19
1.4. Agricultural market liberalisation remains important, including for food security ........................ 20
References ................................................................................................................................................. 23
Chapter 2. Are past OECD analyses of agricultural policy reforms relevant to current policy
and market settings? ................................................................................................................................... 25
2.1. Introduction .................................................................................................................................... 26
2.2. Market situation and outlook ......................................................................................................... 27
2.3. Evolution of the policy landscape .................................................................................................. 29
2.4. Market and trade impacts of agricultural policies .......................................................................... 40
2.5. Achieving optimal policy performance .......................................................................................... 49
2.6. Implications for agricultural trade negotiations post-Bali .............................................................. 57
2.7. Conclusions .................................................................................................................................... 60
Notes.......................................................................................................................................................... 61
References ................................................................................................................................................. 64
Chapter 3. Current domestic policy settings in the context of past and potential international
agreements ................................................................................................................................................... 69
3.1. Introduction .................................................................................................................................... 70
3.2. Background .................................................................................................................................... 70
3.3. Market access ................................................................................................................................. 73
3.4. Export competition ......................................................................................................................... 84
3.5. Domestic support ........................................................................................................................... 97
3.6. Discussion .................................................................................................................................... 116
3.7. Conclusion ................................................................................................................................... 123
Notes........................................................................................................................................................ 124
References ............................................................................................................................................... 128
Chapter 4. Review of the performance and impacts of recent stockholding policies ........................... 133
4.1. Introduction .................................................................................................................................. 134
4.2. Scope of the study ........................................................................................................................ 135
4.3. Performance of recent public stockholding policies that influence prices ................................... 136
4.4. Other impacts of recent public stockholding policies .................................................................. 145
4.5. Conclusions .................................................................................................................................. 147
Notes........................................................................................................................................................ 148
References ............................................................................................................................................... 149

ISSUES IN AGRICULTURAL TRADE POLICY: PROCEEDINGS OF THE 2014 OECD GLOBAL FORUM ON AGRICULTURE © OECD 2015
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– TABLE OF CONTENTS

Tables
Table 3.1. Attributes of studied countries .............................................................................................. 72
Table 3.2. Tariff cuts under harmonising tiered formula for developed countries................................. 74
Table 3.3. Tariff cuts under harmonising tiered formula for developing countries ............................... 74
Table 3.4. Selected elements of tariff profiles in agriculture ................................................................. 78
Table 3.5. Tariff profiles before and after REV.4 reductions ................................................................ 80
Table 3.6. Export subsidy commitments and notifications .................................................................... 86
Table 3.7. Export subsidy outlays and subsidized quantities as percentage of commitments ............... 87
Table 3.8. Export financing support: selected data ................................................................................ 92
Table 3.9. Features of agricultural exporting state trading enterprises (STEs) of six countries ............ 94
Table 3.10. Overview of countries’ food aid programmes ...................................................................... 96
Table 3.11. Bound Total AMS before and after any Rev.4 reduction ................................................... 100
Table 3.12. De minimis percentages ...................................................................................................... 101
Table 3.13. Total blue box limits ........................................................................................................... 102
Table 3.14. Calculation of Base OTDS and Bound OTDS .................................................................... 104
Table 3.15. Assessment of Rev.4 reductions in Bound Total AMS and de minimis percentage ........... 107
Table 3.16. Calculation of current OTDS .............................................................................................. 115
Table 4.1. Performance variables for the different stockholding programmes .................................... 137
Table 4.2. Grain trading enterprises in Africa that deal with buffer stocks ......................................... 139
Table 4.3. Agencies in Asia that manage buffer stocks ....................................................................... 141

Figures
Figure 1.1. Net agricultural production ................................................................................................... 11
Figure 1.2. Real food prices .................................................................................................................... 12
Figure 1.3. Growth in agricultural trade .................................................................................................. 13
Figure 1.4. Notified bilateral and regional trade agreements .................................................................. 14
Figure 1.5. Trends in PSE: OECD and emerging economies .................................................................. 15
Figure 1.6. Applied agricultural tariff rates ............................................................................................. 15
Figure 2.1. International market prices of cereals in real terms, 1971-2023 ........................................... 28
Figure 2.2. Price projections for selected agricultural commodities for the average of years
2014 to 2023 ......................................................................................................................... 28
Figure 2.3. Producer Support Estimate as a share of gross farm revenue, 1995-2023 ............................ 30
Figure 2.4. Shares of country groups in aggregate producer support of all 47 countries covered
in the OECD’s M&E ............................................................................................................. 31
Figure 2.5. Change of %PSE and Producer NPC from 2002-07 to 2012 ................................................ 32
Figure 2.6. Share of potentially most distorting support in all producer support, 2002-07 and 2012 ..... 32
Figure 2.7. Bound and MFN Applied Tariffs for agricultural products, 2012 ........................................ 33
Figure 2.8. Maximum duty (MFN Applied) among all tariff lines for agricultural products, 2012 ........ 34
Figure 2.9. Change of average tariffs (mfn applied) for agricultural products from 2007 to 2012 ......... 34
Figure 2.10. Export measures affecting agricultural products: Number of measures taken,
2007 to 2011 ......................................................................................................................... 37
Figure 2.11. Production impact ratios of alternative agricultural policies: Highest and lowest
results of various OECD studies on decoupling ................................................................... 42
Figure 2.12. Ranges of reduction rates for agricultural tariffs in developed countries suggested in
the successive draft modalities of 2006, 2007 and 2008 ....................................................... 58
Figure 3.1. Commodity prices index 2006-2013 ..................................................................................... 82
Figure 3.2. Change of average tariffs (MFN Applied) for agricultural products from 2007 to 2012 ...... 82
Figure 3.3. China’s net grain imports, 2000-13 ....................................................................................... 93
Figure 3.4. Non-green-box support in the EU, Japan, Russia and the United States ............................ 122
Figure 3.5. Non-green-box support in Brazil, China, India and Indonesia ........................................... 122
ISSUES IN AGRICULTURAL TRADE POLICY: PROCEEDINGS OF THE 2014 OECD GLOBAL FORUM ON AGRICULTURE © OECD 2015
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TABLE OF CONTENTS –

Figure 4.1. Indonesian and Thai wholesale rice price, January 2000 – September 2011 ...................... 142
Figure 4.2. Stocks of wheat and rice in India: actual stock levels vis-à-vis mandated norms
(million tonnes) ................................................................................................................... 143
Figure 4.3. China wheat price support and market price, 2004-14 ....................................................... 144
Figure 4.4. China soybean price support and market price, 2004-14 .................................................... 145

Boxes
Box 1.1. Increasing use of public stockholding policies ..................................................................... 17
Box 1.2. Current trade policies and Doha draft modalities ................................................................. 18
Box 1.3. Principles for agricultural policy design from past OECD analysis ..................................... 19
Box 1.4. Trade and food security ........................................................................................................ 21
Box 4.1. Types of public food stocks ................................................................................................ 135
ISSUES IN AGRICULTURAL TRADE POLICY: PROCEEDINGS OF THE 2014 OECD GLOBAL FORUM ON AGRICULTURE © OECD 2015