January 12, 2007

Brazil may join Canada against US corn subsidies

Brazil's foreign affairs ministry is considering joining the government of Canada in challenging US corn subsidies before the World Trade Organization (WTO), the local Estado de Sao Paulo newspaper reported Thursday (Jan 11).

The newspaper reported that foreign affairs official Roberto Azevedo, of the ministry's economic department, said Brazil could join Canada in a dispute against Washington. Azevedo said the government is in its early phase of studying a potential joint dispute. No dates were given for a decision, Azevedo told the newspaper.

Brazil said it is studying the corn subsidy's impact on international corn prices. Brazil is a small exporter of corn, but corn is the second-largest farm crop in Brazil, trailing soybeans. The country is expected to produce some 43.5 million tonnes of corn in the current crop season, up from 41.6 million produced last year.

On Friday, the Canadian government took its request to study US corn subsidies and their impact on world corn trade to the WTO. Canadian corn farmers said Wednesday that US farmers were immune to low commodity prices and that subsidies permitted cheaper US corn exports to Canada.