US ethanol subsidies. Illegal export subsidy?
Chapter 10 of the book analyzes agricultural trade subsidies. In general trade agreements under the WTO do not raise as many objections to production subsidies as they do to export subsidies (why?). So which is this? From today's Financial TImes The US pumps out a record 37m gallons of ethanol a day, easily surpassing rival Brazil’s sugar-based industry in output. Producers are running out of places to put this ethanol. The US government mandates 12bn gallons in the fuel supply this year, but a decline in American driving and a 10 per cent cap on how much can be blended into motor fuel has created a glut. “The domestic market here in the US is essentially saturated. We are looking for a home for the surplus,” says Geoff Cooper at the Renewable Fuels Association, a US trade group. That home is increasingly abroad. US ethanol exports are more than double those of a year ago, totalling 251m gallons in the nine months through September, government trade data show. ...