The Agricultural Challenges in the Twenty-First Century

Type:

SCID Working Paper 457

Author(s):

Published:

08/2/12

Abstract:

This paper focuses on the challenges that are facing world trade in agriculture. High on the list is the difficulty that will arise if the trend of world agricultural prices over the past half century is reversed and a secular upward trend replaces it. If the future holds higher prices for agricultural commodities, the discipline over agriculture so far achieved under the WTO, and even that which would be augmented under the Doha Round, is fighting the last war. WTO disciplines, including those proposed under Doha, while desirable because prices will surely be low part of the time, are based on the premise that there is a secular trend for falling world prices of agricultural commodities, and that distortions arise because of overproduction. If, instead, distortions start to take the form of export restrictions on the part of agricultural exporters, the problem may be quite different in the future. Protection by high-cost producers may result when importers find their supplies reduced or cutoff when prices are high. A major reason for completion of the Doha Round is that issues such as the need for discipline over agriculture in times of high prices need urgent attention. While Doha languishes, these issues are not being addressed.

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