Next we're going to hear from Dennis DeLaughter, and he's representing the U.S. Rice Producers.

MR. DeLAUGHTER: Good morning. My name is Dennis DeLaughter. I'm a rice farmer. I'm also the president of Progressive Farm Management and Progressive Farm Marketing. I serve as chairman of the Texas Rice Legislative Group, also chairman of the U.S. Rice Producers Association, an association which represents over 6,000 rice farmers. The rice farmers group is made up of rice farmers from the states of Missouri, Mississippi, Texas, and 40 percent of producers in the state of California.

I was recently appointed to the ATAC committee for feed and grain and oilseeds, and I appreciate the opportunity to come and to be able to address you today. I want to thank not only USDA and USTR, but the State Department for their willingness to come out. And I would just say as a side note, having recently been at the ATAC meeting, I realize that there may be people that think that this type of an event is basically doing nothing. But I want to assure those that are listening thatthey are being heard and it is having an impact. And that is to your credit.

The U.S. Rice Producers Association has had cooperative status with the FAS. We're involved in many promotional programs overseas. Recently, the vice president of our group, Nolan Cannon, gave a testimony to the Memphis Group. And because of that and the fact that I've submitted my testimony here, I'm not going to read it. I would like to go through and maybe go over about five points that are mentioned in it, or five recommendations that we have for policy officials as they come into this next round.

Number one, we believe that policy officials need to recognize that rice is not a homogenous product. There is a substantial difference between rough rice, milled rice, and brown rice, and they all three have specific export capabilities. And so it's important that policy officials need to realize that there are three different forms and types of rice, and they need to keep that in the back of their mind as they negotiate.

Number two, we recommend that policymakers assure that countries with current minimum access for rice, like Japan, Korea, as well as other countries -- and other countries who will soon have minimum access commitments, purchase U.S. rice. We would like to see that.

Number three, we would like to see that there's arbitration changes in the EU's rice import policy, and insist on equitable treatment for all forms of rice when it comes to the EU.

Number four, we recommend that policymakers strongly oppose illegal trade arrangements as well as tariff regimes in regional trade blocs that disadvantage U.S. rice producers.

And number five, we'd like to see an enforcement and a strengthening of the enforcement of the World Trade Organization's prohibitions against the use of non-tariff trade barriers for rice, such as the imposition of scientifically unsound phytosanitary trade restrictions. I know you're working on that issue and I commend you for that.

With that said, I have a couple of side remarks to make. Having just been at the ATAC meeting three weeks ago, I know you know the numbers. You know so many numbers it probably spins around in your head at night. I recently returned from Geneva, where I met with several of you and toured the WTO organization, and was totally impressed. I returned with a better appreciation for what you do; I also returned with a greater appreciation of what you're up against. I'm hoping as you travel around and as you have traveled around to these different hearings, that you are also getting a better feel of what we are up against here in the country.

And with that in view, just a couple of personal thoughts. Number one, we gave at the office. In the early '90s, I can remember hearing the phrase, U.S. agriculture must lead the way in reducing trade barriers. Well, we believe we've done that in the Uruguay Round, so I can honestly say we gave at the office. U.S. ag is not in a position to pay any more for a level playing field. It's time that the other side come to the rescue of the U.S. situation.

Number two, I grew up hearing this phrase: The world population is growing so fast that soon we will not be able to feed the world. Well, I believed it, and probably there's many in the audience who believed it and many who may still do. But the facts say that that's no longer true. The fact says the population is really heading down; technical advancement is pretty well proving that we are assured that we are going to easily feed the world. In a recent book by Peter Drucker, he says in his book "Managing for the 21st Century" that there must be a paradigm shift in agriculture. And I believe that is the case. This means that U.S. ag must make this shift both domestically and internationally, and in that shift a level playing field in world markets is critical and time is of the essence.

And so, with that said, I encourage you to continue your efforts. I know what you've done, I know what you're doing, and I really do appreciate it. I know you're working hard to level those playing fields. And not only do I appreciate your efforts, I wish you the best of luck as well. I'll be happy to answer any questions you might have.

MR. GALVIN: Thanks, Dennis. I appreciate your very straightforward and candid testimony. I think it would be good just to mention China a bit, because I think China really is kind of the wild card in many ways in the whole ag trading situation. And they've certainly come on, of course, as a competitor in a number of areas in the last couple of years, and they seem to be gearing up on -- even more on rice in terms of just total production and quality and that sort of thing.

And, you know, I understand your concern about previous statements and beliefs that, you know, the world is going to run out of food and that that period is just around the corner and that sort of thing. But I think if there's one thing that is clear, it's that the current level of subsidies and distortions out there worldwide really are encouraging a lot of excess production that otherwise wouldn't occur. And right now, that's probably about as true in China almost as it is in Europe. It's pretty clear that China is engaged in a policy of self-sufficiency almost at any cost, and they've been spending an awful lot more money here lately to really sustain that policy. And I think it's led to overproduction, but -- you know, waste, fraud, and abuse in China and all that, and I think there are some indications that they realize they've gone overboard.

But I think that really gets back, though, to the real importance of getting them into WTO membership. Because if we were to get the sort of agreement that was outlined for China's accession to the WTO this past spring, we really could get to the point where they'd have to commit to ending first time, their domestic subsidies. So I think it's really a major, major issue for U.S. agriculture to stay focused on, and probably about as much for the rice industry as anybody else.

MR. DeLAUGHTER: Very true. We're following that very closely, because we know that China, while they'll import rice right from their borders, from Vietnam and Thailand, they're also wanting to export rice at this same point in time. So we are watching that in these sessions, what's going on there, with great interest. And we're hoping that that has a great impact on us.

MR. GALVIN: Thank you very much.