The European Union this week said it would begin lifting its ban on biotech food products, starting with canned corn. Beyond that, the news from the trade front this week was NOT encouraging.
Notably, the respected chair of the World Trade Organization's agriculture negotiation team resigned his post. That announcement comes at an awkward time, since the next round of WTO talks is set for December 15th in Geneva, Switzerland.
In advance of those talks, trade ambassadors have been criss-crossing the globe. Their objective is twofold: First, to gauge sentiment among WTO members on trade liberalization. And second, to avoid another collapse in trade talks like the one suffered in Cancun, Mexico, in September.
Among the dignitaries on informal trade missions this week was Pascal Lamy, the trade commissioner for the European Union. Lamy was in Washington to meet with members of Congress, the Bush administration and corporate America. After reassessing European trade policy in the wake of the Cancun disaster, Lamy felt it necessary to gauge U.S. commitment to continued trade liberalization efforts.
Pascal Lamy, E.U. Trade Commissioner: "I think we both see the necessity of trying to reignite this process and we both concur that in order to do that a number of positive signals have to come from a sort of sufficient critical mass of WTO membership..."
Reaching that critical mass will be difficult as new and significant trading blocs emerged at Cancun to derail the talks. Among these was the so-called G90, a group of African, Caribbean, and Pacific nations that Lamy says are leery of trade liberalization efforts championed by the world's richest countries. Those suspicions were strong enough to derail Cancun.
Pascal Lamy: "I think it's no scoop that, for us, Cancun was an important setback..."
Cancun wasn't the only recent setback for industries reliant on exports, like agriculture. A recent increase in ocean shipping rates for bulk commodities could impact those exports. The Wall Street Journal reports that the Baltic Dry Index, which measures shipping rates for everything from soybeans to iron ore, has more than doubled in the past two months.
It said the increase is due to China's surging economy, which is creating strong demand for ships to import basic raw materials for its manufacturing sector.
Economists quoted by the newspaper said the increased shipping rates also could lead to higher consumer prices on certain food products, including livestock that feed on soybeans, grains and corn.