Abstract

The Uruguay Round of the General Agreement on Tariffs and Trade (hereafter, the GATT), which is to be signed by more than 10 nations on December 15, 1993, represents the culmination of seven years of negotiations on reforms of international trade. Assuming that the U.S. Congress will ratify the agreement, most, if not all, agricultural commodities produced in the United States will be affected in some way. The purpose of the present paper is to examine the likely effects of the GATT on U.S. peanut markets. Although the market value of U.S. peanut production is small compared to many other U.S. agricultural commodities, the impacts of the GATT on peanut markets are of considerable interest for at least two reasons. First, because peanut production is concentrated in a relatively small number of states, peanut revenues constitute an important component of incomes in many communities in the southeastern United States. The impacts of the GATT on peanut markets are therefore important to farmers and policy makers in these areas. Second, the federal peanut program is unique among U.S. commodity programs with its marketing quota, price supports, and import restrictions. An important component of the federal peanut program is explicit restriction on imports of peanuts. The restriction has brought attention to the trade conditions for peanuts that seems not to be justified by the value of trade in peanuts. During the course of the Uruguay Round negotiations, for example, peanut import restrictions were used by other countries as an example of restrictive U.S. trade policies.