III

105TH CONGRESS

2D SESSION S. RES. 232

To express the sense of the Senate that the European Union should waive

the penalty for failure to use restitution subsidies for barley to the

United States and ensure that restitution or other subsidies are not

used for similar sales in the United States and that the President,

the United States Trade Representative, and the Secretary of Agriculture

should conduct an investigation of and report on the sale and subsidies.

IN THE SENATE OF THE UNITED STATES

MAY 19, 1998

Mr. DORGAN (for himself, Mr. KEMPTHORNE, Mr. WYDEN, Mrs. MURRAY,

Mr. JOHNSON, Mr. BAUCUS, Mr. CRAIG, Mr. BURNS, Mr. SMITH of Oregon, Mr. CONRAD, Mr. GORTON, Mr. DASCHLE, Mr. ENZI, and Mr.

THOMAS) submitted the following resolution; which was referred to the

Committee on Finance

RESOLUTION

To express the sense of the Senate that the European Union

should waive the penalty for failure to use restitution

subsidies for barley to the United States and ensure

that restitution or other subsidies are not used for similar sales in the United States and that the President,

the United States Trade Representative, and the Secretary of Agriculture should conduct an investigation of

and report on the sale and subsidies.

Whereas, in an unprecedented sale, the European Union entered into a contract with a United States buyer to sell

heavily subsidized European barley to the United States;
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•SRES 232 IS

Whereas the sale of almost 1,400,000 bushels (30,000 metric

tons) of feed barley was shipped from Finland to Stockton, California;

Whereas news of the sale depressed feed barley prices in the

California feed barley market;

Whereas, since the market sets national pricing patterns for

both feed and malting barley, the sale would mean enormous market losses for barley producers throughout the

United States, at a time when the United States barley

producers are already suffering from low prices;

Whereas the European restitution subsidies for this barley

amounts to $1.11 per bushel ($51 per metric ton);

Whereas the price-depressing effects of this one sale will continue to adversely affect market prices for at least a 9-

month period as this grain moves through the United

States marketing system;

Whereas this shipment is part of about 2.1 million metric

tons of European feed barley that have been approved for

restitution subsidies by the European Union this year;

Whereas the availability of the additional subsidized European barley in the international market not only artificially depressed market prices, but also threatens to open

new import channels into the United States;

Whereas, as the world’s largest feed grain producer and the

world’s largest exporter of feed grains, the United States

does not require imported feed grains;

Whereas, at the same time that subsidized European barley

is being imported into the United States, some United

States feed grains are prevented from entering European

markets under European Union food regulations;
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•SRES 232 IS

Whereas United States barley growers continue to suffer the

negative impacts of the sale, regardless of whether the

subsidized European barley was originally targeted for

sale into the United States and whether the subsidies

comply with the letter of current World Trade Organization export subsidy rules; and

Whereas the sale not only undermines the intent and the

spirit of free trade agreements and negotiations, it also

moves away from the goals of level playing fields and

fairness in trade relationships: Now, therefore, be it

1 Resolved,

2 SECTION 1. SENSE OF SENATE ON EXPORT OF EUROPEAN

3 BARLEY TO THE UNITED STATES.

4 It is sense of the Senate that—

5 (1) the European Union should—

6 (A) take immediate steps to waive the pen7 alty for failure to use restitution subsidies for

8 barley exported to the United States; and

9 (B) establish procedures to ensure that

10 restitution and other subsidies are not used for

11 sales of agricultural commodities to the United

12 States or other countries of North America;

13 (2) the President of the United States, the

14 United States Trade Representative, and the Sec15 retary of Agriculture should immediately consult

16 with the European Union regarding the sale of Eu17 ropean feed barley to the United States in order to
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•SRES 232 IS

1 avoid any future sale of any European barley to the

2 United States that is based on restitution or other

3 subsidies; and

4 (3) not later than 60 days after approval of this

5 resolution, the United States Trade Representative

6 and the Secretary of Agriculture should report to

7 Congress on—

8 (A) the terms and conditions of the sale of

9 European barley to the United States;

10 (B) the results of the consultations under

11 paragraph (2);

12 (C) other steps that are being taken or will

13 be taken to address to such situations in the fu14 ture; and

15 (D) any additional authorities that may be

16 necessary to carry out subparagraphs (B) and

17 (C).

Æ