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Published June 29, 2010, 10:39 AM

OECD’s focus on the global future may have an affect on the farm bill conversation

PARIS — In a move with implications for the 2012 farm bill debate in the United States, the Organization for Economic Cooperation and Development is shifting its agricultural focus from reforming agricultural subsidies in developed countries toward helping those governments address climate change, renewable fuels and global food security.

By: Jerry Hagstrom, Special to Agweek

PARIS — In a move with implications for the 2012 farm bill debate in the United States, the Organization for Economic Cooperation and Development is shifting its agricultural focus from reforming agricultural subsidies in developed countries toward helping those governments address climate change, renewable fuels and global food security.

When the OECD, which is composed of 31 wealthy, market-oriented democracies, held its first meeting of member country agriculture ministers since 1998 in February, the ministers concluded that higher commodity prices and global hunger showed a need to address different issues, Ken Ash, the director of the OCED Trade and Agriculture Directorate, said.

Although agriculture ministers from the United States, Europe and other big subsidizers often have clashed with ministers from Australia, New Zealand and some other member countries that subsidize much less, the February meeting “was positive rather than critical and argumentative,” said Ash, a Canadian citizen who has worked at OECD since 1999 and became a director in 2009.

Subsidies to demand

OECD has been a big player in the farm subsidy reform movement since the 1998 meeting when the agriculture ministers were concerned that farm subsidies encouraged overproduction and interfered with markets. At their direction, the OECD staff in 2001 began producing an annual estimate of farm subsidies country by country. Reformers all over the world have used the report in their campaigns to reduce subsidies or at least change their structure so that farmers are not rewarded for planting too much. But as worldwide demand has grown in recent years, commodity prices have risen, government price-related payments to farmers have gone down, and the reform movement has lost some of its energy.

OECD will continue to publish its farm subsidy report, Ash said, but OECD’s new research agenda seems much more likely to be of more assistance to advocates of more food and fuel production than to those who reduce farm spending. With demand for food and renewable fuels strong, the ministers have asked OECD to help governments increase productivity and mitigate the greenhouse gas emissions related to agriculture by doing comparative land use studies, Ash said. In the debate about whether land should be used for food vs. fuel, the ministers took the position that it’s necessary to assure adequate food production, but “if you can have the best of both worlds, why not?” OECD also will look at the challenges that biofuel feedstocks other than corn will present in land use challenges and the role of farmland in carbon sinks, he said.

Working together

OECD also has supported trade liberalization, but on the Doha Round, “after nine years it’s hare to be optimistic in the short term,” Ash said. The big problem, he contended, is not agriculture or manufacturing, but that the negotiations on services such as banking and insurance are so slow that “the Round is incomplete.”

The agriculture directorate also is helping member countries with their global food security initiatives by analyzing how developing countries could improve transportation and storage systems to reduce food waste. Ash acknowledged the current interest in increasing agricultural production in poor countries, but said he is advising the ministers the real issue is poverty reduction. If purchasing power is increased, Ash said, people will get food whether it’s produced in the country or imported.

The OECD was established in 1960 by 20 countries including the United States that thought they could encourage their common aims by working together. Eleven more countries have joined the OECD since that time.

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