[Congressional Record (Bound Edition), Volume 153 (2007), Part 27]
[Senate]
[Page 36125]
[From the U.S. Government Publishing Office, www.gpo.gov]




                          FARM BILL CONFERENCE

  Mr. GRASSLEY. Mr. President, I want to speak about an issue that may 
come up during the negotiations between the House and the Senate to 
reconcile the farm bill.
  The bill we passed last week in the Senate included a sense-of-the-
Senate resolution addressing trade in sweeteners between parties to the 
North American Free Trade Agreement, also known as NAFTA.
  Apparently, some view this language as just a placeholder for new 
language that will be inserted in conference.
  Even more troubling, the new language that is being contemplated 
would call for managed trade in sweeteners between the United States 
and Mexico.
  The issue of trade in sweeteners between the United States and Mexico 
has a long history.
  For years, Mexico put up barrier after barrier to our exports of high 
fructose corn syrup.
  It started in 1998. That year, Mexico imposed an antidumping duty 
order on imports of high fructose corn syrup from the United States.
  We challenged that order, and we won. In 2001, a dispute resolution 
panel determined that Mexico was out of compliance with its obligations 
under NAFTA.
  The appellate body of the World Trade Organization reached a similar 
conclusion.
  The antidumping duty order on our high fructose corn syrup was 
inconsistent with Mexico's obligations under the WTO.
  Mexico finally lifted its antidumping duties in 2002. But that same 
year, Mexico imposed a 20 percent tax on soft drinks flavored with high 
fructose corn syrup.
  This soda tax was designed specifically to discriminate against high 
fructose corn syrup imported from the United States.
  As a result of this unfair discrimination, our exports of high 
fructose corn syrup to Mexico fell dramatically.
  We challenged Mexico's discriminatory tax at the World Trade 
Organization.
  In 2006, the appellate body determined that this tax was inconsistent 
with Mexico's obligations under the WTO.
  Mexico complied with the WTO decision earlier this year by repealing 
its discriminatory soda tax.
  Now, after years of pressuring Mexico to drop its unfair barriers to 
our exports of high fructose syrup, we're finally at a good spot.
  Mexico has eliminated both its antidumping duty order and its 
discriminatory tax.
  We are on the verge of seeing high fructose corn syrup start to flow 
freely across our border.
  Starting January 1, 2008, Mexico is obligated to provide duty-free 
access to our exports of high fructose corn syrup under NAFTA.
  That is why I am so concerned. This new language being contemplated 
for the farm bill could disrupt our legitimate expectations of free 
trade in high fructose corn syrup next year.
  If instead of free trade we end up with managed trade, it could 
significantly impede our exports of high fructose corn syrup to Mexico.
  Under a managed trade regime, we would presumably limit the amount of 
sugar that we import from Mexico.
  And in response, Mexico would presumably limit imports of high 
fructose corn syrup from the United States.
  Simply put, managed trade could reverse all the gains we have made 
over the years to get Mexico to take our high fructose corn syrup.
  Corn farmers and high fructose corn syrup producers in Iowa and other 
States would, of course, be harmed by any import restrictions imposed 
by Mexico as a result of managed trade.
  And managed trade could well result in Mexico further violating its 
obligations under NAFTA.
  Many of my colleagues complain, legitimately, when our trading 
partners fail to comply with their international trade obligations.
  The last thing we should do is give Mexico an excuse to violate its 
NAFTA obligations, particularly when it would harm U.S. agricultural 
producers.
  The current language in the Senate-passed bill does not call for 
managed trade.
  The current language would not likely induce Mexico to impose further 
restrictions on our exports of high fructose corn syrup.
  As a Senator from Iowa, as well as the ranking member of the Senate 
Finance Committee and a member of the Committee on Agriculture, I have 
worked hard over the years to get a fair deal for agriculture when it 
comes to international trade.
  In particular, I have put considerable effort into opening foreign 
markets to our exports of agricultural products.
  Too often our trading partners have imposed barriers to U.S. farm 
exports. And too often those barriers are in violation of international 
trade obligations.
  Those barriers harm American farmers and agricultural producers.
  Whether it is unfair restrictions on U.S. beef exports to Japan and 
Korea, or under restrictions on U.S. corn exports to Europe, it is 
imperative that we focus our efforts to remove barriers to trade.
  With effort, we have been successful in getting our trading partners 
to remove such barriers.
  That is the case with Mexico's treatment of high fructose corn syrup, 
as I have described.
  We can't go backwards.
  Our corn farmers and our producers of high fructose corn syrup are 
counting on us.
  I will be working hard to see that the current language on trade in 
sweeteners is retained without change in the conference report to the 
farm bill.
  Free trade in high fructose corn syrup with Mexico is long overdue.
  I yield the floor.

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