Cautious optimism emanated from the latest round of World Trade Organization talks in Hong Kong. Here is a joint statement issued Monday by the U.S. Dairy Export Council and the National Milk Producers Federation.

After a week of intense negotiations in Hong Kong, World Trade Organization members agreed to a new negotiating text that keeps the Doha Round alive. The draft ministerial declaration locks in incremental progress on several fronts, and preserves the negotiating momentum by giving countries four more months to come together on modalities.

The due date for draft modalities ― the specific formulas that dictate how reforms will be carried out ― was moved back to April 30, 2006. Each country then has until July 31, 2006, to inform the WTO what changes it will make to its tariff schedules and support programs to comply with the modalities. A final deal is slated to be complete by the end of 2006.

The draft declaration commits countries to eliminate all export subsidies by 2013, and provides preferential treatment to least-developed countries. However, details and formulas dictating specifically how subsidies will be cut or how markets will be opened were not addressed in Hong Kong.

Therefore, discussions in the first few months of 2006 will now be crucial to comply with the new timetable and reach an agreement by the end of the year. The objectives of the U.S. dairy industry for this negotiation remain unchanged: to level the playing field by eliminating export subsidies and reducing and harmonizing market access and domestic support. Nothing in the Hong Kong declaration precludes us from achieving those goals, but a positive outcome remains contingent on the specific details and formulas still to be determined.

Toward that end, the U.S. Dairy Export Council and National Milk Producers Federation staffs will continue to work closely with U.S. negotiators to reach a balanced outcome that positions the U.S. dairy industry to compete on the world market.