MR. LaVIGNE: Thank you, Kevin. Good morning. Ambassador Esserman, Dr. Siddiqui, Mr. Baas, Commissioner Crawford, I'm Andy LaVigne, Executive Vice-President and CEO of Florida Citrus Mutual, a voluntary cooperative association with membership consisting of more than 11,500 Florida growers of citrus for processing and fresh consumption.

Mutual represents more than 90 percent of Florida citrus growers and 80 percent of the U.S. growers of citrus for processing into processed citrus products. I am before you today on behalf of the members of the Florida citrus industry, Florida Citrus Mutual, and other associations that extend their appreciation for the opportunity to offer these comments to you today. Those groups are the Gulf Citrus Growers Association, Highlands County Citrus Growers Association, Indian River Citrus League, Peace River Valley Citrus Growers, Florida Citrus Packers, Florida Citrus Processors, and the Florida Department of Citrus.

We are heartened by the efforts of the U.S. trade representative, the U.S. Department of Agriculture, and the other agencies of the Administration to reach out to the growers, processors and affected members of the growers U.S. industries whose health, and perhaps whose very existence, depends upon the positions taken and agreements reached by the United States in any multilateral or regional trade negotiations.

It is important for the Administration to hear firsthand from the farmers who have their lives invested in the land, many of whom have owned the land for several generations. By coming here to our home to listen to the concerns of the Florida agriculture industry, you will be better prepared to face the challenges of the next Round of the multilateral negotiations and to understand the challenges we face competing in the world marketplace.

While Mutual applauds the general objectives of the balance and comprehensiveness of the WTO negotiations, we strongly oppose the negotiations of any further tariff reductions on citrus or process-to-citrus product reductions or eliminations. Thus, it is essential that any multilateral or bilateral discussions on tariff reductions be undertaken on a request offer basis rather than formula driven or other comprehensive approach. In a word, any trade agreements which further reduce U.S. tariffs on orange juice and/or fresh citrus imported from Brazil beyond the level found in the Uruguay Round will not only contravene assurances made by the U.S. trade representative during the North American Free Trade Agreement negotiations, but will also spell the end of the U.S. industry producing citrus for processing and fresh consumption.

The Brazilian citrus industry is the world's largest by a significant margin. It has made no secret of its need to expand the market share in the world's most lucrative market, that of the United States in order to provide an outlet for their local planting and overproduction which has been characterized most in the past two decades. In fact, the U.S. International Trade Commission recently determined that revocation of an anti-dumping order on frozen concentrated orange juice from Brazil would be likely to result in material injury to domestic growers, thus voting to leave the anti-dumping order in effect.

While the U.S. industry has worked with the all the administrations in the past on numerous trade liberal-izing measures affecting citrus, the Caribbean Basin Initiative, the U.S./Israel Free Trade Agreement, and even the North American Free Trade Agreement deferenced by the U.S. industry in this instance to the apparent Brazilian priorities will be tantamount to suicide.

The U.S. citrus industry can not support any free trade negotiation which does not provide clear-cut protection for the highly import-sensitive citrus industry. Events in the world citrus markets during the past two decades illustrate the challenges posed to the U.S. growers in the dominant Brazilian citrus industry. While orange production is grown in both the U.S. and in Brazil, the tremendous growth in Sao Paulo has far outpaced that in Florida. Orange productions in Sao Paulo have grown at an annual average rate of 5 percent since the early 1980s, reaching a record 420 million boxes in the marketing year '97-'98. In that year Brazil produced 53 percent of the world's orange juice. The United States produced 40 percent.

However, in that same year Brazil consumed only 1 percent of its production locally while exporting 90 percent primarily to the European Union and the United States. The United States, on the other hand, exported only 10 percent of its orange juice production while consuming the rest domestically.

The dominance of the Brazilian orange juice -- excuse me -- the dominance of Brazilian orange juice in the foreign markets has enabled the Brazilian industry to gain tremendous influence over global orange juice supplies and prices, world orange juice production and inventory through 20 percent and 59 percent respectively between the marketing year '93-'94 and the marketing year '97-'98. The rapid growth in inventories is indicative of a severe supply problem which has caused both the Brazilian and commodity futures prices for frozen concentrated orange juice to decline dramatically during the past decade in tandem with the Brazilian expansion.

Commodities futures prices are considered one of the most accurate indicators of U.S. prices for frozen concentrated orange juice which has and will continue to have a direct impact on the price of U.S. processing oranges. Between the marketing year '88-'89 and marketing year '97-'98 the on-tree price of processing oranges in Florida plummeted in response to falling orange juice prices with grave repercussions to U.S. citrus growers.

The low on-tree prices have increasingly cut into grower's returns, placing them in an extremely tenuous position. This is especially true for growers in the southwest Florida area that produce mainly early and mid-season orange varieties.

Unlike annual crops, a citrus tree has a life of approximately 25 years with grower's investment, depreciation and financial decisions made accordingly. Both the Brazilian and the Florida growers -- for both the Brazilian and the Florida growers the commencement of the citrus production is not a decision which can be reversed or modified easily in response to world supplies and prices.

Brazil has already been found by the United States to have engaged in both sales of less than fair value prices and receipt of available subsidies. An anti-dumping order remains in effect on frozen concentrated orange juice from Brazil. In response to Petitioner's allegation of sales below cost production during the '97-'98 administrative review of the anti-dumping order of frozen concentrated orange juice from Brazil, the U.S. Department of Commerce recently issued a preliminary dumping margin of 62.5 percent to the four companies covered by the review and for the exporters not previously reviewed.

In addition, in the recent expedited 5-year sunset review of FCOJ anti-dumping on frozen concentrated orange juice from Brazil, Congress found that dumping would likely continue or recur if the dumping order were revoked. Thus, the anti-dumping order on FCOJ will remain in effect.

The lifeblood of the multi-billion dollar agriculture industry in Florida -- tomatoes, citrus, vegetables -- is found in the equalizing import tariff imposed on products from countries like Brazil which do not incur the environmental, worker safety, water, welfare, tax and other government-related costs which Florida growers must bear. In addition, the Brazilian horticultural industry is not subject to the same child labor laws and other labor standards that exist in the United States.

Furthermore, that tariff alone does not account for the unfair advantages enjoyed by some foreign producers who have engaged in dumping or received subsidies in past years that put Florida at a marked disadvantage for many years into the future.

In an ideal free market and world economy, natural advantages would outweigh arguments for tariff protection, but the Florida agricultural sector in general can not close its eyes to the reality that eventual elimination of the tariff on Brazilian citrus would be a death sentence to the U.S. citrus industry and devastating to the economy of Florida.

Aside from the impact of unrestrained free trade in the U.S. citrus industry, the most highly touted benefit of free trade agreements, which is lower prices to consumers, would not be realized in the case of processed citrus products. Increasingly, the price of retail orange juice products has not threatened the declining of wholesale or future prices of FCOJ, which has led to a buildup of Florida stocks.

It is fair to assume that the original demise of Florida industry, should the next Round of the WTO negotiations reduce or eliminate the U.S. citrus tariffs, is not likely to yield direct benefits to consumers but only cost savings to reprocessors. If anything the Brazilian industry, which is already highly concentrated, given 80 percent of the production is held by four companies, will lose competitive restraint on prices and the U.S. consumer will suffer the consequences.

In conclusion, Florida Citrus Mutual submits that before any new WTO negotiations commence, sufficient limitations must be incorporated into the authorizing legislation including an agreement to proceed only on a request offer negotiating basis to ensure that citrus and similarly situated agricultural industries are not subjected to any tariff cuts beyond what was committed to under the Uruguay Round.

U.S. citrus growers can not be expected to suffer any tariff cuts benefiting the largest producer in the world when their unique conditions of trade, and indeed their very existence, is completely debt dependent on the maintenance of protective equalizing tariffs. Also, the importance of maintaining a stabilizing anti-dumping order on FCOJ can not be overstated. U.S. citrus growers have worked with the U.S. trade representative in the past trade agreements in exchange for assurances that they would not be forced to concede to any future trade agreements, particularly those which Brazil is a part of.

The Florida citrus industry has other areas of concern as the Administration moves forward with the WTO negotiations, such as retention of strong science based SPS standards, the impact of government relations on trade equity, and as Mr. Loop just mentioned, pest and disease and eradication is a major concern to this state and the industry. But you will hear these concerns from all counterparts in the Florida agricultural community commenting here today.

However, we feel so strongly about retaining the current tariff on orange juice and/or fresh citrus products from Brazil that we have focused our comments expressed in this area. Florida Citrus Mutual respectfully requests the U.S. WTO negotiators carefully consider and fully acknowledge the seriousness of this issue and the great economic stakes involved to Florida citrus growers, the upstream suppliers, and the entire economy of central and south Florida.

Madam Ambassador, Dr. Siddiqui, Mr. Baas, Commissioner Crawford, we thank you for providing this opportunity to allow Florida's agriculture industry to express its concerns and comments regarding the upcoming WTO negotiations. As I know you are aware, I am also joined today by Florida Citrus Mutual's trade consultant Bobby McCallum, who has been intimately involved in these issues for many years. Should some questions arise I can always defer to him -- pass the buck. I'll be pleased to respond to any questions that you have. Again, thank you for allowing Florida to be the host of the first session -- the first Round of the Listening Sessions. Thank you.

(Applause.)