TN/AG/54  
TN/AG/SCC/19  
 
15 August  2022 
(22-6189) Page: 1/5 
Committee on Agriculture  
Special Session  
Sub-Committee on Cotton   
 
17TH DEDICATED DISCUSSION OF THE RELEVANT  
TRADE -RELATED DEVELOPMENTS FOR COTTON  
12 MAY 2022 
Report1 by the Chair person , Ambassador  Gloria ABRAHAM PERALTA  
1.  Pursuant to the Bali Ministerial Decision on Cotton  of 7 December 20132 and the Nairobi 
Ministerial Decision on Cotton  of 19 December 20153, the 17th Dedicated Discussion of the Relevant 
Trade-Related Developments for Cotton  (the Dedicated Discussion)  took place on 12 May 2022. 
The Dedicated Discussion was  held back -to-back with the 3 7th Round of the Director -General's 
Consultative Framework Mechanism on Cotton  (DGCFMC) dealing with the development assistance 
aspects of cotton .  
2.  In my report on the state of play in the agriculture negotiations I referred to the different 
outcomes envisaged by Members for cotton at MC12. The LDC Group in its submission4 had 
suggested a "stand still" on the level of trade distorting support on cotton and a comm itment to 
negotiate further disciplines by MC13. In discussions prior to the meeting, s ome Members had 
restated their  support to the C-45 while some other Members had reiterated  that the draft text on 
cotton as contained in TN/AG/50 was an acceptable basis for a possible outcome at MC12.  
3.  In light of the short time ahead of MC12, I urged Members to narrow the remaining gaps in the 
agriculture negotiations and find possible landing zones bu ilding upon the work done so far.  
I stressed that, th e outcome on cotton  should include both trade and development components , with 
the latter being discussed in DGCFMC meetings chaired by DDG Paugam. I also stressed  the recent 
focus by Members on the poss ible consequences of the on -going global food security crisis and how 
the WTO could address the related challenge s and underlined the relevance of cotton in this regard, 
as an important element for a comprehensive  food security strategy in some of the poorest countries.  
4.  Under the agenda item " General Statements from Members ", Burkina Faso , on behalf of 
the C-4, regretted the lack of engagement in the negotiations on cotton and called for a balanced 
outcome at MC 12 taking into account  the inputs by the C -4, ACP, African group and LDC groups . 
The C4 emphasized  that the outcome should  addres s trade-distorting support for cotton, recalling 
that the COVID -19 pandemic had led to an increase in such support. The C -4 also reiterate d its call 
on Members to be more transparent about the measures taken in response to COVID -19, to 
implement  the market  access  commitments under the Nairobi Decision , and to lift all 
trade-restrictive measures that may have a  negative  impact  on the cotton sector.  
 
1 This report is circulated under the Chair's own responsibility.  
2 Document WT/MIN(13)/41 - WT/L/916.  
3 Document WT/MIN(15)/46 - WT/L/981.  
4 Document JOB/AG/227 . 
5 Benin, Burkina Faso, Chad, and Mali.  TN/AG/54 • TN/AG/SCC/19  
 
- 2 - 
 
  5.  Chad emphasized the importance of cotton  to LDCs, underlining its strategic role in developing 
rural economy  and feeding poor population s in Africa. Chad regretted  the lack of  outcome on 
trade-distorting support from previous Ministerial meetings and urged Members to renew  efforts to 
negotiate  a concrete outcome , with the  objective to progressively eliminate trade -distorting support  
and agreeing on new disciplines by MC13 .  
6.  Recalling  the mandate  from Hong Kong  to address cotton " ambitiously, expeditiously 
and specifically " and emphasizing the patience demonstrated by the C -4 in the negotiations,  
Australia urged  all Members to work towards a concrete outcome on domestic support at MC12  and 
called on all Members to support the C -4 in its efforts, almost 20 years after the launch of the group's 
initiative. For Australia , the choice in front of Members was clear and the text contained in document 
TN/AG/50 constituted a good starting point  for an outcome at MC12 that would pave the way for 
decisions  on domestic support and cotton at MC13.  
7.  The European Union (EU) noted the serious disruptions caused to cotton supply chain s by the 
COVID -19 pandemic . The EU also considered that trade and supply chains  were also disrupted by 
the Russian  Federation's  unprovoked and illegal aggression against  Ukrain e. Beyond its effects in 
Ukraine, it had increased food insecurity in many developing countries and LDCs and  had increased 
price volatility  in cot ton markets due to uncertain demand and high energy prices . In this context , 
the EU reiterated its call for multilateral  commitment s related to  food security , transparency, 
exemption of export restrictions on WFP food purchases, as well as a work programme  for continuing 
agriculture negotiations beyond MC12 .  While welcoming the recent LDC proposal, t he EU supported 
the draft Chair's text and stressed that, in light of the limited time left before MC12, the outcome 
on cotton should focus on what was feasible, namely transparency  and development  assistance .  
8.  Nigeria voiced support for the C -4's and recalled the African Group's positions in agriculture 
negotiations , including cotton . It reaffirmed its  strong call for a "level playing field" through th e 
reduction of cotton -specific A ggregate Measurement of Support (AMS)  support to enhance the 
competitiveness  of resource -poor producers from developing and least -developed  countries .  
9.  The United States (US) acknowledged the important role of cotton for the C -4 and other cotton 
producing countries as well as the importance of the continuation of domestic  support and market 
access reform for the development of the cotton sect or and agriculture in general . The United States 
noted  that any agriculture outcome should ensure that future negotiations are equitable and focused 
on creating less restrictive market access conditions. Stressing that Market Access was a priority  
and the area where most gains for producers were likely to be found , the US noted that the level of 
ambition on Market Access should match that o f Domestic Support. The US also underlined that any 
outcome on Domestic Support should  ensure equitable and co mmensurate contributions by Members 
taking into account their potential to distort international markets. On Export Competition, the US 
called for more transparency  including improving the response rate, timeliness,  and quality of replies 
to the Secretaria t questionnaire.  Finally, in light of the limited time remaining before MC12 and the 
divergent positions between  Members, the US considered  that the only feasible outcome at MC12 
for cotton , and most of the agriculture negotiation areas , was improved transparen cy and a general 
work programme for post MC12 work .  
10.  Brazil  voiced its readiness to accept the Chair's text that captured the current situation in the 
negotiation on cotton , namely  agree on improving transparency  for cotton at  MC12 , and  continue 
negotiations on modalities to reduce trade -distorting support  including for cotton for  adoption at 
MC13 . 
11.  China, as a producer, importer,  and consumer of cotton, stressed the importance on cotton in 
the agriculture negotiation and flagged  its concern with t he lack of progress on this topic that 
somehow reflected the overall state of play in the negotiations . While reiterating its view that 
eliminat ing cotton specific AMS beyond the de minimis  level should be the priority, China recognized 
the need for  a realistic approach to reach an agreement by  MC 12 and  thus supported the Chair's 
text.  
12.  Japan  recognized the current critical circumstances in agricultural trade caused by  the Russian 
Federation's invasion of Ukraine. As a co -sponsor of the proposal JOB/A G/213, it  also voiced support 
for continuous efforts in enhancing transparency and monitoring trade  measures related to cotton .  TN/AG/54 • TN/AG/SCC/19  
 
- 3 - 
 
  13.  The International Cotton Advisory Committee (ICAC)6 updated Members  on the latest 
developments in the global cotton  market , with a focus on the trend of exports from west Africa. 
ICAC also  presented the evolution of global assistance to cotton production  and the negative 
correlation between subsidies and prices  confirmed during the COVID -19 crisis and  pointed to the 
various factors influenc ing the forecast for cotton production in the upcoming  planting season, 
including positive  ones such as high cotton prices as well as  uncertainties that had negative impact s 
including increased input prices , the continuation of the COVID -19 pandemic  and geopolitical unrest.  
14.  ICAC's presentation as usual elicited great interest  and received high appreciation by Members. 
The C -4 welcomed the detailed data provided by  ICAC which should usefully inform Members  in the 
negotiations  on cott on. 
15.  Chad raised two questions : (1) noting the importance of energy in the textile sector, whether 
ICAC could indicate how the current energy market situation impact ed cotton international markets, 
and as a consequence, production and processing in the C-4 countries ; (2) how digitalization c ould 
help producers in Africa increase cotton production and better export cotton . Chad concluded by 
stressing th at cotton was produced in the C -4 in small farms respecting social and environmental  
clauses .  
16.  ICAC conf irmed that high energy prices could lead to a decrease  in cotton production as energy 
was a key component in fertilizer production and high energy prices would increase fertilizer  costs. 
ICAC did not anticipate any short-term solution to this issue but not ed that it had been working with 
various countries to improve the knowledge on soil nutrients to develop  long-term solution s. ICAC 
was encourag ing countries to explore alternative option s allowing them to  move away from the  
volatile energy  market -based  fertilizers .  
17.  Regarding how the C -4 could benefit from digitalization, ICAC pointed to an upcoming platform 
that will provide real-time ICAC data on cotton markets at both global and country -level. ICAC was 
also develop ing a platform allowing individual producers , traders,  and textile industry 
representatives to interact with each other . ICAC noted that such a platform would  enable the C-4 
to reach out directly  to textile  manufactures without going through intermediaries .  
18.  China asked  ICAC to c larify the source of the data used by ICAC on cotton production, 
consumption,  and trade. Noting the difference  between ICAC  and WTO's  data on cotton assistance , 
China sought  further information from ICAC concerning  country -specific  support  and the impact  of 
cotton subsidies  on international trade and cotton prices.  
19.  Türkiye , noting the increase o f cotton  production  in some countries  during the COVID -19 
pandemic, asked  whether such  increases could be related to the level of  support to cotton  
production . 
20.  ICAC clarified that , to the extent possible , its data were coming from primary sources such as 
official  government reports or direct communication with governments  officials . In the absence of 
such data,  ICAC would make its own pro duction pro jection  based on historic data and in the case of 
trade, it would rely on information from the Trade Data Monitor, UN Com trade or ITC. ICAC  noted 
that some of its  publication s include information on country -specific assistance  and invited China 
and Türkiye  to contact them for further details.  
 
6 ICAC's presentation can be found on  
https://www.wto.org/english/tratop_e/agric_e/icac_presentation.pdf .  TN/AG/54 • TN/AG/SCC/19  
 
- 4 - 
 
  21.  The Secretariat introduced the updates and highlights of the  revised background paper7 and 
addenda .8 The background paper compile s up-to-date information and data from Members' 
notifications and other submissions on export subsidies, domestic support,  and market access, 
including both tariff and non -tariff measures. The background paper also captures Members' latest 
responses to the questionnair e on cotton policy developments, as well as relevant information on 
cotton markets and policies included in Trade Policy Review reports .  
22.  I reiterated that the quality of the background paper relied on the quality and timeliness of 
Members' notifications a nd submissions to the WTO, including replies to the questionnaire. I invite d 
all Members  – and in particular key cotton actors – to be more forthcoming in sharing information 
on recent policy development s. I thanked the two Members that responded for the f irst time to the 
questionnaire and called on others who have not yet replied to do so as the information shared 
voluntarily through this channel is an important addition  to WTO  notifications.  
23.  Under the  agenda item " COVID -19 and Cotton ", the WTO Secretariat reported on the key 
take-aways from the  Information Session9 on Supply Chain Disruptions Affecting Cotton Exports 
from LDCs that took place on 11 May. The session  had been  informed by the study by the Secretariat 
on the impacts of COVID -19 on cotton and its value chain in key cotton producing LDCs . Participants 
discussed the numerous supply chain challenges  resulting from the COVID -19 crisis, including 
congested ports, shipping logjams, inc reased freight rates , longer duration of port -related formalities 
and longer storage periods , and their impacts on the cotton sector in LDCs . The negative impact of 
high fertilizers price was also stressed by the participants, who finally engaged in a reflection on 
possible ways to minimize supply chain disruption s for cotton and mitigate their impact on global 
trade and post -pandemic economic  recovery in the WTO  context.  
24.  I thank ed the Secretariat, Members,  and partner organizations  that contributed to the 
information session . I noted that a key observation identified by the study was the serious logistic 
disruptions and increased storage costs  that posed serious challenges for cotton marketing and trade 
in cotton  producing LDCs . This  point was also stressed on various occasion s by several LDC and 
non-LDC cotton supply chain actors.  
25.  In this regard, I welcome d the Partners' Conference to be organized as a side event to the 2022 
Aid for Trade Global Review in the afternoon of 27 July  and hoped that  this high -level platform w ould 
help cotton producing LDCs secure technical and financial assistance for managing su pply chain 
challenges caused by the COVID -19 pandemic and support  their domestic cotton sectors .  
26.  The C -4 welcomed the information session  and noted that the discussions had confirmed that 
the COVID -19 crisis continue d to have disastrous effects on the wel fare and export earnings of LDCs.  
The C -4 flagged its concern with the impact of the continued fall of cotton prices  since 2018 further 
exacerbated by  the pandemic . The decline in cotton production  as a result of  these uncertainties, 
aggravated by higher inputs prices  had in turn resulted in a decrease of cotton exports  and export 
earnings  for African producers facing unfair competition from subsidized production . In light of these 
observations, the C -4 called for  Members ' support  to find a lasting solution to address the concern s 
of cotton farmers in LDCs  from both the trade and development perspective s. The C -4 reiterated its 
invitation to all partners to participate  in the Partners' Conference  and hoped that the  discussions 
would lead to the adoption of a roadmap  for reducing  disruptions in the cotton supply chain and 
mitigating their impact on world trade and post -pandemic economic recovery within the framework 
of the WTO.  
 
7 The presentation can be found on   
https://www.wto.org/english/tratop_e/agric_e /secretariat_presentation_backgrond_paper.pdf . 
8 Documents TN/AG/GEN/34/Rev. 16 - TN/AG/SCC/GEN/13/Rev. 16, TN/AG/GEN/34/Rev. 16/Add.1  - 
TN/AG/SCC/GEN/13/Rev. 16/Add.1 and TN/AG/GEN/34/Rev. 16/Add.2  - TN/AG/SCC/GEN/13/Rev. 16/Add.2 , 
dated 29 April 2022, and TN/AG/SCC/GEN/13/Rev. 16/Add.1/ Corr.1 dated 9 May 2022 . 
9 see https://www.wto.org/english/tratop_e/agric_e/info_session_cotton_ldc11522_e.htm  TN/AG/54 • TN/AG/SCC/19  
 
- 5 - 
 
  27.  Chad illustrated the various challenges resulting from  the COVID -19 pandemic for cotton 
producers  including the difficulties to store and ship cotton properly , and the resulting financial losses 
for cotton farmers and operators . Chad stressed the importance of the upcoming Partners' 
Conference  for WTO Members  to reconfirm their support to  cotton producing LDCs.  Beyond the 
current challenges, Governments and cotton companies had to  better prepare for future shocks  and 
improve risk management policies , including through technology transf ers in the fields of  
digitalization and information technologies.   
28.  Benin echoed the statements  by the C -4 and Chad . Benin also noted that one of  the conclusions 
of the information session had been the importance of exploring ways to increas e domestic cotton 
processing activit ies, and the role of  development partners  in this regard .  
29.  While welcoming the  report on the information session  and acknowledging the effects of the 
COVID -19 pandemic on the cotton supply chain on  many sectors , the US also viewed 
the Russian  Federation illegal and unprovoked war in Ukraine as an additional cause  of disruptions 
to the cotton supply chain . Noting tha t the war  had further dis rupted  access to key agricultural  
products and inputs , including  the fuel to transport agricultural  products  and the fertilizers  to produce 
them, the US  urged the Russian Federation to end the war to resolve these disruptions .  
30.  Benin pointed to the link between  food security and cotton , for developing  countries such as 
Benin who imported  key staple food s such as wheat and other products and  looked forward  to further 
discussions on this issue.  I acknowledg ed that food security was a key issue, as confirmed by recent 
WTO meetings  including  the recent event on food security and trade organized by the WTO 
on 26 April and  welcomed Benin's intention to particip ate in further discussions on this topic.  
 
__________