TN/AG/29  
TN/AG/SCC/3  
 
5 February 2015  
(15-0763)  Page: 1/4  
Committee on Agriculture 
Special Session 
Sub-Committee on Cotton    
 
 SECOND DEDICATED DISCUSSION OF THE RELEVANT 
TRADE-RELATED DEVELOPMENTS FOR COTTON 
28 NOVEMBER 2014 
Report1 by the Chairman, H.E. Mr John Adank 
1.  Pursuant to the Bali Ministerial Decision on cotton of 7 December 2013 (document 
WT/MIN(13)/41 - WT/L/916), the second dedicated discussion of the relevant trade-related developments for cotton took place on 28 Novemb er 2014, in the context of the Committee on 
Agriculture in Special Session. The dedicated discussion was held back to back with the 22
nd round 
of the Director-General's consultative framework mechanism on the development aspects of cotton. 
2.  In my opening remarks , I noted that in Bali Ministers had renewed their commitment to 
address cotton "ambitiously, expeditiously and specifically" within the agriculture negotiations, and to continue discussions on reform as per the August 2004 General Council Decision and the 2005 
Hong Kong Ministerial Declaration, with the 2008 revised draft agriculture modalities 
(TN/AG/W/4/Rev.4) providing a reference point for further work. 
3.  I further noted that in Bali, Ministers had agreed to enhance transparency and monitoring in 
relation to the trade-related aspects of cotton through bi-annual dedicated discussions. The first 
dedicated discussion took place on 20 June 2014
2 and saw a constructive and factual exchange of 
views regarding Members' trade-related policies and relevant developments for cotton. As such, the dedicated discussions were complementary to the negotiation track. 
4.  I referred to the three Decisions adopted at the special meeting of the General Council on 
27 November 2014, and noted that the dedicated di scussions were part of the implementation of 
the Bali cotton Decision, and as such, benefite d from the renewed impetus provided by the 
Decision on post-Bali work. 
5.  I informed Members of my intention to immediately resume our work on the agriculture 
negotiations and the post-Bali work programme, with the convening of a special session of the Committee on Agriculture on 4 December 2014. I stressed that cotton would be an important 
element of that work, and that I would continue to reach out to concerned Members to see how 
best to ensure substantive consideration of outstanding issues and to deliver on the cotton mandate. 
6.  Under the agenda item " General Statements from Members ", several Members welcomed 
the convening of the second dedicated discussion as an immediate and positive signal of the renewed post-Bali impetus. 
                                               
1 This report is circulated under  the Chair's own responsibility. 
2 The Chair's report on the first dedicated discussion of the releva nt trade-related developments for 
cotton can be found in document TN/AG/28 - TN/AG/SCC/2 dated 17 July 2014. TN/AG/29 • TN/AG/SCC/3 
 
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  7.  On behalf of the Cotton-4 (C-4), Burkin a Faso expressed the hope that the resumed 
negotiations would lead to concrete results on cotton. The C-4 reiterated its readiness to actively contribute to the resolution of the cotton issu e and called for the active engagement of all 
Members in achieving that goal. Several Members supported the statements made by Burkina Faso 
on behalf of the C-4, and indicated their readine ss to engage constructively on the post-Bali work 
on cotton. 
8.  Brazil and the United States reported on the October 2014 Memorandum of Understanding 
regarding the Upland Cotton dispute.
3 Brazil also provided information regarding technical 
assistance stemming from the cotton dispute sinc e 2010, and which had been provided to cotton 
sectors in Sub-Saharan Africa, Mercosur member countries and its associates and Haiti. Brazil noted that those initiatives showed that bilateral understandings settled within multilateral 
institutions could benefit third parties interested in the matter thus strengthening the multilateral 
trading system. 
9.  Sudan made reference to its recently circulated document (WT/CFMC/W/60) describing the 
situation of its cotton sector and the reforms it was undertaking. 
10.  The second dedicated discussion was informed by a revised  background paper by the 
Secretariat  (TN/AG/GEN/34/Rev.1 - TN/AG/SCC/GEN/13/Rev.1) which compiled factual 
information and data from Members' notifications and other submissions to the WTO on export 
subsidies, domestic support and market access, including both tariff and non-tariff measures. In addition, following suggestions made during the first dedicated discussion in June, the revised 
paper also included information on cotton imports from the world and from LDCs by importing 
country, as well as a series of new supporting charts. 
11.  While Members welcomed the revised Secretariat background paper as a useful basis for 
discussions, several, once again, regretted ga ps of information due to a lack of recent 
notifications, and encouraged all Members to bring their notifications up-to-date to allow for a 
more comprehensive discussion. More specifically, some Members regretted the lack of information on recent cotton policy developments for major producers, importers and exporters of cotton, and 
urged those Members to comply with notification obligations.  
12.  Some Members suggested additional ways to collect information on relevant policy 
developments, to further improve transparency on cotton policy and market trends. One Member 
proposed that the Secretariat circulate in advance of the dedicated discussions a questionnaire on 
recent policy developments for cotton and include Members' replies in the Secretariat background 
paper. Another Member suggested that the Secretariat conduct a targeted exercise of information collection on cotton, similar to the process used in the Trade Policy Review Mechanism (TPRM). 
13.  I noted that the Secretariat could circulate a questionnaire as suggested, but that the success 
of that process would depend on Members' readiness to provide such information in a timely fashion. With regards to the proposal for a TPRM-type approach, I pointed out that while 
conducting dedicated TPR reviews on cotton would be beyond the Secretariat's capability, it could 
try to compile information related to cotton markets and policies contained in the most recent TPR reports. There were no objections to my suggested way forward. 
14.  Members also benefitted during the meeting from a presentation by Mr. José Sette, Executive 
Director of the International Cotton Advisory Committee (ICAC) , on global cotton market and 
trade trends.
4 While Members welcomed ICAC's input as highly informative and relevant, some 
suggested the inclusion of further information, including on national policy developments affecting 
cotton markets. It was agreed that ICAC would be invited to make a more detailed presentation at 
the next dedicated discussion. 
                                               
3 WT/DS267/46. 
4 http://www.wto.org/english/news_e/news14_e/icac_trade_28nov14_e.pdf  TN/AG/29 • TN/AG/SCC/3 
 
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  15.  During the discussion of trade-related develo pments for cotton across the three 
pillars , several Members welcomed the recent notification on domestic support by India, including 
data on support granted to cotton producers. One Member noted the significant increase of India's 
cotton exports in recent years, and enquired abou t the underlying factors behind that evolution. 
India stressed the need to examine cotton develo pments under all three agricultural pillars, 
including some recently reformed domestic support schemes. India also noted that a high share of its cotton imports originated from LDCs. 
16.  Some Members sought clarifications from China on recent announcements on limiting the 
level of cotton imports in 2015. Other Members noted the recent evolution of cotton support policies in China and its significant role in world cotton markets, and asked for increased transparency regarding China's support to cotton producers. China pointed out that it had been in 
recent years the world's largest cotton producer, consumer and importer (including from LDCs). 
China justified the decision to limit imports by the high level of accumulated stocks, and noted that it would do so in conformity with its WTO commitments. China also noted that developed 
countries' restrictions on textile imports impeded its textile production and exports, dampening 
both the industry's demand for cotton and its imports. China also indicated that a new domestic support notification was currently under preparation. 
17.  The C-4 reiterated its call for up to date domestic support notifications, which it saw as a 
necessary starting point for a reflection on working assumptions, on the basis agreed in Bali. 
18.  One Member referred to the low share of US  cotton imports originating from LDCs, and also 
enquired about the fill rate of some US tariff rate  quotas for cotton. A query was also raised about 
the link between the position of the United Stat es as the world leading cotton exporter, and the 
level of support granted to US cotton producers.  The United States explained that one of the 
factors influencing cotton exports was the recent sharp decline in the US textile industry which had 
led to a reduction in domestic processing capacity. 
19.  The C-4 requested Members to provide more detailed information on applied duties to LDCs 
cotton exports, including within preferential regimes. With regards to non-tariff measures applied 
to cotton, the C-4 asked Members to ensure that their SPS and other such measures were not 
more trade-restrictive than required in order to avoid impeding on cotton exports from LDCs. 
20.  With regards to export competition, while some Members welcomed the sharp decline in the 
use of export subsidies for cotton, others noted th at export credits continued to be used. The C-4 
reiterated its call for developed country Members that still maintained export subsidies or other 
measures with equivalent effects on cotton to indicate what steps had been taken for their elimination. 
21.  I welcomed the productive exchange of information and encouraged Members to continue to 
engage in an interactive discussion and provide responses to questions brought forward by other 
participants. I further noted that Members could also provide information they thought might be 
relevant to the discussions through written submissions. 
22.  With regards to the way forward , the C-4 proposed holding inter-sessional consultations 
devoted to technical negotiations in-between th e biannual dedicated discussions. I took note of 
that suggestion and asked all Members to reflect on how we could best move forward on cotton in 
the process towards the elaboration of a clearly defined work programme on the remaining DDA 
issues. 
23.   A number of Members indicated that the draft modalities TN/AG/W/4/Rev.4 should remain 
the basis for a future outcome on cotton. However,  another Member noted the recent evolution in 
cotton support policies in some developing countries and questioned whether the Rev.4 draft would help address all current global distortions to the cotton market. 
24.  I reminded Members that while the dedi cated discussions could provide context to our 
discussions in relation to the post-Bali work programme on the remaining DDA issues, they were not a substitute for the actual negotiations, includ ing on policy responses, which we would need to 
take forward in the context of the Special Session. TN/AG/29 • TN/AG/SCC/3 
 
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  25.  Finally, I suggested that in light of the Bali Decision setting up dedicated cotton trade 
discussions, I provide from now on my customary u pdates on the state of play in the agriculture 
and cotton negotiations during the dedicated trade discussions for cotton rather than at the meetings of the Director-General's consulta tive framework mechanism on the development 
aspects of cotton. There were no objections to my suggestion. 
26.  The third dedicated discussion will be conven ed before the 2015 summer break, at a date to 
be confirmed, back to back with the next meet ing of Director General consultative framework 
mechanism on the development aspects of cotton. 
 
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