TN/AG/42  
TN/AG/SCC/13  
 
10 September 2019 
(19-5783) Page: 1/4 
Committee on Agriculture  
Special Session  
Sub-Committee on Cotton    
 
ELEVENTH  DEDIC ATED DISCUSSION OF T HE RELEVANT  
TRADE -RELATED  DEVELOPMENTS FOR COTTON  
4 JUNE 2019 
Report1 by the Chairman , Ambassador John Ronald Dipchandra (Deep) Ford  
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 11th Dedicated Discussion of the Relevant 
Trade-Related Developm ents for Cotton  took place on 4 June 2019. The Dedicated Discussion was  
held back -to-back with the 3 1st Round of the Director -General's Consultative Framework Mechanism 
on Cotton  (DGCFMC) de aling with  the development  assistance aspects of Cotton . 
2. In my introductory remarks, I reported on the state of play in  Cotton negotiations . I noted 
that based o n the three -track process established in  February , namely  – monthly CoA Special 
Session s, Working Groups , and Chair's consultations with delegations in various formats , three 
possible non -exclusive outcomes on agriculture negotiations  were envisaged : (i) a transparency 
outcome; (ii) a stand -alone substantive outcome meaning limited -scope outcome covering only a 
limited number of selected topics , and (iii) an integrated su bstantive package meaning a broader 
balanced multi -topic package that Members would agree on at MC12.   
3. I noted that Cotton remain ed one of the most frequently mentioned priority issues and  the 
general understanding was that any outcome should include  Cotton. I further noted that the working 
group process for Cotton took place in the format of the Technical Quad Plus meeting . The "Friend 
of the Chair" , Daniel Costa Figueiredo  of Brazil  reported on the four Technical Quad Plus meetings 
convened on 15 February, 6 March, 12 April and 16 May 2019, respectively.  
4. The Friend of the Chair noted that the Working Group ha d actively engag ed in two main tasks : 
(i) Cotton -related data collection ex ercise within the Quad Plus group ; (2) Exchange on elements 
and potential options for an outcome on Cotton.  On Cotton -related data , the Friend of the Chair 
noted that  Quad Plus Members had been updating and expanding a compilation of data which was 
intended to be an informal evolving tool to inform Cotton negotiations. The compilation was initially 
based on the questionnaire sent by the C4 to a selected group of Members in July 2018 on 
production , prices, value of production  and domestic support  data, as well as  available  
complementary information. The Friend of the Chair noted that since the submission of the  first draft 
compilation in March , Technical Quad Plus  Members had suggested additions to  the compilation: a  
new line on the number of Cotton producers , and  data lines on Market Price Support and Market 
Access information , with the latter  still under participants' assessment.  
5. On the elements and potential options for an outcome on Cotton , the Friend of the Chair noted 
that participants had not identified any additional element to the list of possible options he had 
outlined on 15 February and which covered the three pillars and develo pment aspects. The 
discussions had primarily focused on Cotton Trade -Distorting Support and were based on an on -
going exercise of illustrative calculations using available data. The Friend of the Chair  noted that  the 
last version of the calculations contai ned simulations based on the following proposals: the C4 
                                                
1 This report is circulated under the Chair's own responsibility.  
2 Document WT/MIN(13)/41 – WT/L/916, dated 11 December 2013 . 
3 Document WT/MIN(15)/46 – WT/L/981, dated 21 December 2015 . TN/AG/42 • TN/AG/SCC/13  
 
- 2 - 
 
  proposal in TN/AG/GEN/46; the proposal by Brazil, EU, Colombia, Peru and Uruguay in document 
JOB/AG/99; the proposal by China and India in document JOB/AG/137; and the proposal by 
New Zealand, Austra lia, Canada, Chile and Paraguay in document JOB/AG/114. The Friend of the 
Chair noted that at  the next meeting of the group, participants would continue exchanges and 
address the remaining listed topics .  
6. I commended the Friend of the Chair 's leadership in taking the process forward and welcomed  
his initiative  to address the other  potential Cotton outcome elements under Domestic Support, 
Market Access , Export Competition  and development -related aspects .  
7. I noted that my objective was to have an outline of possible elements and related options for 
Members  to reflect on  and engage after the summer break in a n outcome -oriented process , using  
the various Ministerial meetings scheduled in the second half of 2019 as "stepping stones" to 
galvanize the negotiating process.  Noting the short time till MC12, I reiterated my call to Members 
to engage actively and prepare submissions and inputs  to inform such an outline  of options . 
8. I also encouraged Members to commit  to the dedicated discussions  process as, although not 
a negotiati ng forum , the dedicated discussions provide a unique opportunity for Members to 
exchange  information  on each other's Cotton trade -related policies thereby laying  the foundation for 
negotiations .  
9. Under the agenda item " General Statements from Members ", Benin , on behalf of the C4, 
welcomed the proposed approach  to guide agriculture negotiations towards  MC12 . The C4 stressed 
the importance of the work undertaken in the Technical Quad Plus  meetings  in advancing Cotton 
negotiations. The C4 suggested that the Cotton -related data and the illustrative calculations  
developed from the Technical Quad Plus meetings be shared with all Members for their consideration . 
Given the divergent positions on the various topics in the negotiations , the C4 urged Members to  
fully commit towards achieving a satisfactory resolution of the Cotton issue. 
10. Togo reiterated the  negative economic and social impact of export subsidies and trade -
distorting support granted by WTO Members on its country . Togo noted that Cotton subsidies 
continued to negatively impact world Cotton prices  result ing in large income losses  in Cotton  
producing and exporting Africa n countries  and LDCs. Togo, supported by Benin and Chad,  recalled 
the Nairobi Decision commitments to eliminate Cotton export subsidies and grant favourable market 
access conditions to Cotton  exports from LDCs and noted that much  remained and needed to be 
done in order to achieve substantial reduction or elimination  of trade -distorting support . Togo 
encourage d Members to regularly report updated data on  Cotton  domestic support  and looked 
forward  to concrete and measurable Cotton  results  by MC12 . 
11. The Europea n Union  noted its continuous constructive engagement with the C4 on trade and 
technical assistance aspects of Cotton  despite its marginal role in the Cotton  market . The EU stated 
its readiness to engage in negotiations on Cotton  based on  any realistic and balanced proposal which 
respected all Members ' red lines . The EU reiterated that all Members needed to abide by their 
notification obligations to allow for efficient and su ccessful  negotiations .   
12. Brazil reaffirmed  its commitment to the Cotton  negotiations with a view  to reaching an 
outcome  on both trade and development  aspects  at MC12. Brazil  viewed the long-standing  issue of  
trade -distorting support as a priority and welco med the discussions  in the Technical Quad plus .  
13. India and China noted that , like the C4, Cotton  was a vital contributor for poverty reduction 
and rural development for them  as it is grown  mainly by small and subsistence farmers. India 
recalled that  98.2%  of LDCs Cotton  imports tariff lines  benefitted from  DFQF access with LDCs 
imports account ing for nearly 23% of India' s Cotton  imports.  
14. China elaborated on the damage caused by AMS granted by exporting developed Members , 
noting that  AMS beyond de minimis  had the same impact as export subsidies , distort ing Cotton  
markets and affecting  Cotton  producers from developing and LDC Members. China referred  to a US 
study which forecasted  that world Cotton  prices would increase by 7-14% if developed Members 
were to eliminate  their AMS. China noted that  due to  imports of  highly  subsidized  Cotton , its Cotton  
growing area declined and annual production of Cotton  had decreased  by 20% from 2007 to 2018 . 
In China's vie w, per capita subsidies, rather than the absolut e total amount of subsidies, was the 
key determining factor of distortion  and highlighted the disparity between developing Members (less TN/AG/42 • TN/AG/SCC /13 
 
- 3 - 
 
  than USD 100) and some developed Members (over USD 30,000) in th at regard . China also noted 
that the C4 accounted  for 5.1% of total Chinese Cotton  import s during 2007 -2017.  
15. India and China  reiterated their position that address ing AMS beyond de minimis  would be the 
top priority  in negotiations on Cotton  domestic support . Australia and Colombia noted that the 
outcome on Cotton  should not target a group of Cotton  subsidizers  but rather sh ould require all 
major Cotton  subsidizers to contribute .  
16. The United States encouraged Members to engage in deeper discussions on all current factors 
distorting global Cotton  market s including the influence of new  factors  such as competition  from the 
polyester  fibre sector . The US also noted the importance of exchang ing on  and understanding of 
Cotton -related data notified by Members. In the US' view, until a substantive  technical discussion 
on all the above -mentione d factors  took place amongst all Members , it would  be difficult to consider  
any potential outcome s in Cotton . The United States encouraged Members  to make  technical 
presentations and submissions and to be more transparent regarding their Cotton  policies , including 
on subsidies granted to man -made fibers , data  which was currently unavailable .   
17. The International Cotton  Advisory Committee (ICAC)  made a detailed presentation  on 
the latest developments in the global Cotton  market , including data on  trade trends4 which elicited 
great interest among Members. Most Members' comments and questions related to  the following 
two points of the presentation: (1) the negative correlation between  the international price of Cotton  
and direct assistance to Cotton  production; and (2) low intra -African trade despite the continent's 
huge potential in Cotton  lint producti on.  
18. Benin, Burkina Faso, Chad and Mali registered concern regarding the distortions on Cotton  
markets from the global assistance to Cotton , particularly trade -distorting domestic support and 
export subsidies. Benin reiterated its request for ICAC to provide a breakdown of support to Cotton  
by Member and by category . ICAC referred to its annual publication on Cotton  production and trade 
subsidies which had been circulated to Members through the Secretariat  and available on its website . 
Burkina Faso  asked if ICAC could estimate the loss of revenue result ing from  global support granted 
to Cotton . ICAC noted that this could be addressed  in future presentations.  
19. In addition to price fluctuations, Chad highlighted a few other challenges faced by its Cotton 
sector such as lack of Cotton -processing facilities, high input prices and low production level. Chad 
asked ICAC to evaluate  the impact of  Cotton  produced by the main producers on the market. Chad 
and Côte d'Ivoire  also pointed to the  impact  of exchang e rate s on African Cotton  producers ' revenue 
and asked ICAC  how a reasonable or even fixed exchange rate  could be ensured .    
20. ICAC noted that one of its core efforts  was directed at increas ing yields in Africa , especially 
amongst West African farmers . ICAC drew Members ' attention to the launch of World Cotton Day  on 
7 October 2019 where it would present two initiatives to help African farmers increase yields.  
Regarding  main Cotton  producers, ICAC noted that while no new major producer  had emerg ed in 
recent years,  the amount of Cotton  produced by  major producers ha d changed. ICAC noted that 
manmade fiber  is Cotton 's main comp etition  and its share in the market had increased over the last 
20 years . On the question of exchange rate s, ICAC  stressed the importance of transparency in the 
price-setting mechanism  in the market .  
21. Mali, supported by Côte d'Ivoire, reiterated their concern regarding the low intra -African trade 
despite the free trade zone  developed recently in Africa  to promote  intra-regional trade . Mali sought 
detailed statistics in that regard . Mali also pointed to the negative impact of the recent trade wars 
which decreased Africa's Cotton  exports . ICAC was asked to provide more details of the level of 
Chinese government reserves and their impact on Cotton  markets.  
22. ICAC noted that the key reason of low intra-African Cotton  trade wa s the lack of spinning 
facilities in many African countries. On the question of China's  Cotton  stocks, China responded that 
as of May 2019 , and based on the  data from  the China Cotton Association , 3.5 million tonnes of 
Cotton  were stocked in 164 storages  areas  in 18 provinces .  
                                                
4 This presentation can be found at:  
https://www.wto.org/english/tratop_e/agric_e/agenda_item_3i_a_icac_presentation.pdf .  TN/AG/42 • TN/AG/SCC/13  
 
- 4 - 
 
  23. The WTO Secretariat presented its revised background paper  and a ddenda5 which compile s 
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 paper also 
include s Members' latest responses to the questionnaire on Cotton  policy developments, as well as 
relevant information on Cotton  markets and policies included in Trade Policy Review reports .  
24. I reiterated  the importance of Members' role in keeping the Secretariat  document as an up -
to-date and useful tool . The quality of the information contained in the Secretariat paper  was fully 
dependent on the quality and  timeliness of Members' notifications and submissions to the WTO, 
including replies to the questionnaire circ ulated by the Secretariat .  
25. I welcome d all recently submitted notifications on the three pillars by various  Members and 
encourage d all Members to be more forthcoming in sharing information on recent policy 
developments, particularly the key Cotton  actors.  Benin and Chad echoed my comment and called 
for more recent data to be submitted by Members.  
26. The International Trade Centre (ITC) gave a recap  of the Cotton Portal  and an update 
regarding the improvements made to the Portal since the Dedicated Discussion of November 2018.  
Further to a request by the C4, the ITC also demonstrated the Export Potential Map Tool using 
Cotton  exports from the C4 as an example.  
27. The C4 welcomed the tool and asked Members to work together with the ITC to ensure that 
the data published online are up -to-date. Burkina Faso suggested that ITC designate focal points in 
the countries who were able to provide inputs to facilitate data exchange.  Burkina Faso also asked  
how ITC promoted the tool and whether statistics  on the use of the tool was available. Finally, 
Burkina Faso asked whether ITC could prepare country files with an emphasis on  untapped export 
potential  and guidance to assist political decision makers and enterpris es to make use of those export 
opportunities .   
28. ITC responded that the data in the Export Potential Tool was sourced from the T rade Map 
using UN Comtrade and complemented by data provided by  national statistics offices. ITC noted that 
their statisticians were in close contact with national statistics offices to ensure its data are up -to-
date. The ITC  also confirmed that it would be possible to produce Cotton  country report s.  
29. The Secretariat provided an update on preparations for the launch of World Cotton Day at the 
WTO on 7  October 2019. I drew Members ' attention to a high-level trade -related side event which 
would be dedicated to the state -of-play of Cotton  negotiations and pursuit of a potential outcome  
for MC12. The C4 called for Members ' active participation in the event and expressed gratitude 
towards the various sponsors.6   
30.  In my  concluding remarks , I thanked Members and all partner organizations for their 
contribution to advance our discussions on Cotton. I encouraged Members to make use  of all the 
information available and reflect on the possible elements and related options in the Cotton  
negotiations during the summer break .  
__________  
                                                
5 Documents TN/AG/GEN/34/ Rev.10 – TN/AG/SCC/GEN/13/Rev. 10, TN/AG/GEN/34/Rev. 10/Add.1 – 
TN/AG/SCC/GEN/13/Rev. 10/Add.1 and TN/AG/GEN/34/Rev. 10/Add.2 – TN/AG/SCC/GEN/13/Rev. 10/Add.2,  
dated 24 May 2019.  
6 The C4's statement is circulated as document TN/AG/41 – TN/AG/SCC/12, dated 6 June 2019 .