1. U. S. Canola Association Doug Scoville,1 st VP USCA Potlatch ID

2. USCA Position on Canola Trade in Doha Round Canola is a North American Crop – 13 million Canadian, and 1 million US planted acres in 2006 Increased access for Canadian canola in world will = better prices for North American producers USCA / CCC positions on canola trade are aligned in Doha Round of trade negotiations.

3. USCA communicated these canola objectives to the US Trade Representative Achieving parity in tariffs for canola seed and oil. Achieving parity in tariffs for canola products and competing products. Eliminating tariffs on products for which the current applied tariff is below ten percent.

4. Reducing tariffs in the first band of the tariff reduction formula by the maximum amount possible (canola and canola product tariffs in most major markets are below 20 percent). Minimizing tariff escalation by requiring a reduction on top of the general formula, to be front-end loaded in the tariff phase-out period rather than applied only at the final bound rate. Increasing real market access for sensitive products through increases in quotas, quota parity between competing products, and zero percent in-quota tariffs.

5. Assuring that designation of sensitive products will not discriminate between competing products. Encouraging importing countries to support an oilseed sectoral initiative (the so-called Level Playing Field) in order to emphasize the importance of tariff reduction and set a precedent for the request-offer phase of the negotiations. Prohibiting the use of special product designations to protect competitive industries in developing countries (e.g., palm oil in Malaysia or soybeans in Brazil).

6. Achieving country-specific objectives: China should establish parity in tariffs between competing oilseeds and oilseed products. Tariffs on canola seed and products should be reduced to zero. Japan should establish parity in tariffs between canola and soybeans with palm and sunflower. The tariff de-escalation formula should result in a further reduction of at least 30 percent on top of the general reduction formula. In exchange, Japan should be allowed a longer phase-in period for tariff reductions.

7. Country Specific objectives cont. India: In-quota tariffs should be removed to provide meaningful market access for canola oil. At a minimum, the in-quota tariff for canola oil should be reduced to parity with soybean oil, rather than parity with all vegetable oils. India should also reduce over-quota tariffs.

8. U.S. Biodiesel Industry Faces Unique Challenge from Imports U.S. Biodiesel is not protected by an import tariff Imported biodiesel eligible for $1 / gallon tax incentive Argentina offers incentives for biodiesel exports: –biodiesel exports taxed at 5% –soybean oil exports taxed at 24% –19% Differential Export Tax (DET) worth $0.43/gal U.S. (& Canadas) biodiesel industry could be crippled by this unfair advantage