And Mr. Pete Penner from the California Raisin Marketing Board.

MR. PENNER: Good morning. I'm Pete Penner, raisin grower in California. I'm Chairman of the California Marketing Board. I'm here on behalf of the Raisin Marketing Board to comment on specific interests and concerns of over 5,000 raisin growers and the processors as they relate to us in the upcoming World Trade Organization negotiations in agriculture.

The California Raisin Marketing Board represents producers of raisins in California. California accounts for virtually all commercially grown product in the United States, about 45 percent of the world production. Our raisins have a farm gate income of about $500 million.

Forty percent of our annual production is exported. We export raisin paste and raisin juice concentrate. But our primary export product is raisins. Our industry's principal interest in the upcoming negotiations is that they result in improved and expanded access for U.S. raisin exports. With world production of raisins increasing, this is an important issue for our industry and one reason why we have a specific interest in seeing China accede to the WTO.

Despite the Uruguay Round reductions and commitments, U.S. raisins still face high tariffs in many markets, competition from subsidized foreign producers, and sanitary and phytosanitary restrictions, which have questionable scientific bases. We are looking to the upcoming negotiations to improve upon the shortcomings of the Uruguay Round agreement and produce a more favorable, competitive environment for the U.S. raisin in both our domestic and export markets.

The Board has submitted written testimony that describes in detail the specific improvements we are seeking in the areas of tariff reduction, domestic subsidy commitments and sanitary and phytosanitary restrictions. I will briefly describe these for the panel.

As to tariffs, we want reduced tariffs on raisins and raisin products in all world markets. U.S. Tariffs on imported raisins are low, below five percent on an ad valorem basis. In contrast, tariffs in most of the outside countries are significantly higher. For example, in India it's 120 percent. In Korea, it's 28 percent. In Thailand it's 30 percent. In China, it's 40 percent. This tariff is unbound and therefore unpredictable. If China accedes to the WTO, it has committed to reduce its tariff on raisins to ten percent by the year 2004.

In the area of domestic subsidies, we are seeking sector specific reduction commitments that would require the EU and other producer countries to make reductions in the amount of aid benefitting the raisin sector. This requires that the Uruguay Round formula of reducing subsidies based on an Aggregate Measure of Support for a group of commodities be abandoned and new reduction commitments reached on sector specific subsidies.

The third area where we seek improvement is the Uruguay Round agreement on sanitary and phytosanitary measures. We appreciate that the Uruguay Round Agreement was groundbreaking in that it included new, scientific based rules for sanitary and phytosanitary restrictions. Many countries, however, have been slow in implementing these commitments to science-based restrictions and have neither undertaken the necessary research to justify the science behind their restrictions nor suspended them.

Japan and Korea are among other countries that are continuing to impose onerous tolerance levels on sulfur dioxide, benzoic acid and other additives and preservatives found in raisins. And the European economic community has other issues that face us that you can read about in our final draft.

Finally, China is of great interest. We know that through our market research in that country and the Chinese have demonstrated a preference for California raisins. And we view China as a major market for us. And so we're very concerned about this.

So we are, as an industry, are just encouraging you to do everything you possibly can to help us to be able to compete in a world market that's fair to all.

Thank you.