International commodity agreement

An international commodity agreement is an undertaking by a group of countries to stabilize trade, supplies, and prices of a commodity for the benefit of participating countries. An agreement usually involves a consensus on quantities traded, prices, and . A number of international commodity agreements serve solely as forums for information exchange, analysis, and policy discussion.

USTR leads United States participation in two commodity trade agreements: the International Tropical Timber Agreement and the International Coffee Agreement (ICA). Both agreements establish intergovernmental organizations with governing councils .

The International Coffee Organization (ICO) is the main intergovernmental organization for coffee. ICO exporting members account for more than 97 percent of world coffee production, and its importing Members, are responsible for around 80 percent of world coffee consumption. The ICO makes a practical contribution to the world coffee economy and to the improvement of living standards in developing countries by facilitating intergovernmental consultation and coordination regarding coffee policies and priorities, by encouraging a sustainable world coffee economy, by initiating coffee development projects to add value and improve marketing, by increasing world coffee consumption through innovative market development activities, by promoting the improvement of coffee quality, by working closely with the global coffee industry through a 16-member Private Sector Consultative Board, and by ensuring transparency in the coffee market with objective and comprehensive information on the world coffee sector by means of statistics and market studies.

The United States led recent efforts to renegotiate the ICA, and the text of the seventh International Coffee Agreement (ICA 2007) was adopted by the International Coffee Council on September 28, 2007. The new ICA is designed to enhance the ICO's role as a forum for intergovernmental consultations, to increase its contributions to meaningful market information and market transparency, and to ensure that the organization plays a unique role in developing innovative and effective capacity building in the coffee sector. Among the features of the new agreement is a first-ever "Consultative Forum on Coffee Sector Finance" to promote the development and dissemination of innovations and best practices that can enable coffee producers to better manage financial aspects of the inherent volatility and risks associated with competitive and evolving markets. Other notable changes include expanding the organization's work in providing relevant statistical and market information and strengthening efforts to develop, review and implement capacity building projects that are particularly important to small-scale farmers in key developing country trading partners.saervez chaoudhary

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