MR. WEETS: Thank you for giving me an opportunity to talk to you today. I'm Carl Weets. I'm a soybean and grain farmer from Cooper, Texas. On behalf of the Texas Soybean Growers, I'd like to thank you for the opportunity to present our recommendations on agriculture trade programs -- on agriculture trade priorities for the upcoming round of the WTO negotiations.

When the Titanic sunk, there weren't enough lifeboats for all those on board, and the ones that weren't used -- and the ones that were, weren't used to their full capacity. The ag ship of America is sinking just as fast as the Titanic did years ago, and there aren't enough lifeboats for even a fraction of the American farmer. And the ones Administration has at their disposal are not being used properly, and some of the lifeboats and safety nets are full of holes.

Every other row of soybeans produced by growers is exported overseas. Soybeans and soy products are our nation's largest agricultural export commodity, and exports reached the 9 billion dollar mark in the '98, '99 marketing year. My economic livelihood and that of all U.S. soybean growers is linked to exports.

We believe that a level playing field will greatly benefit U.S. soybean growers by giving us increased access to foreign markets, eliminating unfair export practices, and stimulating demand among customers. We believe that the United States should vigorously pursue this initiative in the next WTO round. It is past time for the United States to take off the gloves and be aggressive in pursuing the level playing field that the Administration has promised us since the passage of the Freedom to Farm Act.

The Administration has failed to protect American soybean growers from unfair trade practices of the European Union. The European Union continues to subsidize their ag sector in violation of the GATT agreement. The EU continues to use export subsidies to undercut American commodities sales in numerous countries. Recently, the EU has used unsubstantiated claims of unsafe food in order to prohibit sales of GMO's in Europe. If the beef debacle can be used as a measuring stick, the American farmer can look forward to five years of foot-dragging by the EU and five years of whining by our administration that the EU is not using sound science. Hopefully we can then enjoy the WTO ruling in our favor and only to -- only to have the EU thumb their collective noses at us and still deny us access to their markets, all the while continuing to subsidize their farmers and their exports, further lowering farmers' market share of the world commodity market.

Meanwhile, the Freedom to Farm Act will have run its course and left the American farmers with no subsidies and fighting not just other countries' farmers but the government's as well. Our administration has not lived up to their end of the bargain. They refuse to take off the gloves and fight back with the tools they have available; for example, to refuse to use the EEP.

The Administration states that they want to go into WTO rounds negotiations with clean hands on exports in the export arena. Dirty hands don't seem to bother the EU. They want to protect their ag sector, while our administration prefers to give us debt service and keep their hands clean and money available for other areas of the budget.

The Texas Soybean Growers and the farmers would prefer that the Administration give us less lip service and more action. Get our hands dirty and protect us from unfair trade practices like was promised us when the Freedom to Farm Act was passed. We are living up to our end of the agreement, now please live up to yours.

Rulings governing biotech trade must be included in the WTO round in order to ensure science-based regulatory reviews and trade rules. These rules also need to be recognized for the disparity in fees charged by same companies for identical inputs, such as the Rhina (sp) green bean technology fees. Farmers in foreign countries are not being charged these fees for the use of their GMO technology, while farmers in the U.S. are not only paying for the fees assessed us, but also financing the fees for other countries. And the technology fees are continually being raised every year.

In essence, the American farmer is subsidizing his competitors in foreign countries by funding research and development of new technology. The level playing field that the Administration so eagerly embraced in 1995 must not only cover equal access markets but also equal access to those imports.

These WTO rules must supersede the rules of any other international trade agreement, and the WTO appears to be almost as effective as the League of Nations in the 1920s. The Texas Soybean Growers feel that if the WTO refuses to take action on unfair trade barriers based on unsound science, that the U.S. should take action to correct the problem.

Weakness in the current WTO dispute settlement system is readily apparent. The United States should not have to file complaint after complaint in order to achieve compliance with a dispute settlement panel that ruled in favor of the United States.

As we have stated before, WTO is almost as effective as the League of Nations and needs serious work in order to protect the American farmer's market from unfair trade practices.

Providing income and other support to agricultural producers has been a key feature of ag policy in many nations, including our own. WTO rules should address this situation. EU refuses to pass any substantial reforms or subsidies that are paid to their ag sector. Currently, the EU subsidizes their ag sector to the tune of 150 billion dollars, while the U.S. lags far behind. Another example of Administration's failure to provide a level playing field.

U.S. Agriculture needs to be represented in the world negotiations by negotiators who are dedicated to protecting American agriculture. Currently, agriculture is being used as a pawn in a trading ship in the world of commerce. Agriculture is a stepchild to any trade advantage we might have -- that we should have should not be traded away by our negotiators in order to gain advantage in other areas. Secretary Glickman and the USDA needs to be the American farmer's voice in Washington and around the world in the upcoming GATT negotiations.

Thank you again for your time and the priorities of the Soybean Growers of Texas.

MR. GALVIN: Thank you, Carl. We appreciate your statement. I'd like to go back, if I could, to your concerns about our not using the EEP program. I just want to assure you that the fact that we're not using it is not due at all to any desire on our part to go into the next round with, quote, you know, clean hands when it comes to export subsidies.

As I indicated earlier, the reason we've decided not to use EEP currently is because of our concern that if we use it in this present world environment, where we've seen four straight years of record world production, all we're going to do is drive prices down further. And that's going to come back to bite us in terms of displacing our corn exports and other things that we're trying to move.

And I'd also like to just kind of reiterate once again that we've been very, very aggressive in our use of export credit guarantees and in commodity donations; in fact, to the point where we're taking a lot of steady criticism from the Australians, the Canadians, the Argentines, and others that we're using export credits unfairly, that we're donating commodities unfairly to the point where we're displacing commercial sales, that sort of thing.

I want to say that that criticism doesn't bother us at USDA. I'm just telling you that we are getting it pretty hard and heavy, to the point where these other countries are saying that they want to make sure that in the next WTO, that there are these further disciplines on export credit guarantees or further disciplines on the use of commodity donations for food aid.

So I understand your point that we ought to be using EEP more aggressively, although I'm not sure if what you're saying is we ought to use EEP for soybean exports. Because if that's what you're saying, frankly, that's the first time I've heard that the soybean industry would like us to use EEP for soybeans. But I think that's an interesting point, if, indeed, that's what you're suggesting today.

MR. WEETS: It's something to be looked at, maybe. On the donations, I think what's happening in the world today, these foreign countries are using the GMO issue and the donation issue as a marketing play. Because they're saying, why should we buy wheat from you or beans from you or whatever; you're going to give them to us anyway. You know, I don't like that attitude, but I don't know what we're going to do about it.

The GMO in Europe, I think it's the same. It's just a market play is all it is. They're just trying to beat the price of stuff down. Then all of sudden they'll come up one day, and they're going to buy some when it gets finally cheap enough, but they're going feel like they're stealing it. That's what's happening. China has been doing it for years. Everybody is using the United States as a cash cow in this whole trade deal, and it's getting pretty tiring.

MR. GALVIN: I do understand your concerns about GMO's as it relates to our trade with Europe. I will say, though, that even though in the case of corn, we have, for the time being, lost our 200 million dollars in annual corn sales to Europe because of the GMO issue, at least in the case of soybeans, we continue to move more than two billion dollars worth of soybean and soybean products to Europe. Even though a lot of those soybeans, of course, are round-up ready, genetically-modified soybeans.

So as of yet, it hasn't had that realdirect impact on soybean exports to Europe. And, of course, we'll be, you know, continuing our efforts to make sure that there isn't some sort of backlash on soybeans.

MR. WEETS: Soybeans, I guess, have been real lucky in the fact that you can use soybeans for so many different things. And they are gaining market share in other parts of the world. I just hate to see these foreign countries using all these little things as a play to get the market down. I'm getting pretty tired of that.

MR. GALVIN: No. I understand, Carl.

MR. WEETS: Anyway, I just -- I wanted you to look at that.

And then, you know, on the tech fees, that is a real -- that is a real problem. These companies don't seem to understand how much cost per acre it actually is. And I was told, like, it was $4 an acre. Well, that's a farce. On our soybeans that we grow, the technology fee is getting to be more than the rent of the farm. You know, 10 or more dollars an acre just for a technology fee isn't right. And the guys in South America aren't having to pay it, and there's certain seed companies in the United States that don't pay it. They just keep sticking it to certain ones. And the fact that these companies are buying the seed companies, they're taking the technology fees all back to themselves and they're not -- in these other foreign countries, they're just not charging these fees. And that needs to be looked at.

MR. GALVIN: That's interesting. I wasn't aware that in Argentina, for example, that there are farmers that are planting soybeans or BT corn who are not paying a technology fee.

MR. WEETS: It's against -- I believe it's against the law down there to charge the fees

MR. GALVIN: All right. Thank you.