An international commodity agreement is an undertaking by a group of countries to stabilize trade, supplies, and prices of a

commodity In economics, a commodity is an economic goods, good, usually a resource, that specifically has full or substantial fungibility: that is, the Market (economics), market treats instances of the good as equivalent or nearly so with no regard to w ...

for the benefit of participating countries. An agreement usually involves a consensus on quantities traded, prices, and

stock management Inventory management, also known as field inventory management, is the task of understanding the stock mix of a company and the handling of the different demands placed on that stock. The demands are influenced by both external and internal fa ...

. A number of international commodity agreements serve solely as forums for

information exchange Information exchange or information sharing means that people or other entities pass information from one to another. This could be done electronically or through certain systems. These are terms that can either refer to bidirectional '' inform ...

analysis Analysis (: analyses) is the process of breaking a complex topic or substance into smaller parts in order to gain a better understanding of it. The technique has been applied in the study of mathematics and logic since before Aristotle (38 ...

, and

policy Policy is a deliberate system of guidelines to guide decisions and achieve rational outcomes. A policy is a statement of intent and is implemented as a procedure or protocol. Policies are generally adopted by a governance body within an or ...

discussion. As of 2023, the

United States The United States of America (USA), also known as the United States (U.S.) or America, is a country primarily located in North America. It is a federal republic of 50 U.S. state, states and a federal capital district, Washington, D.C. The 48 ...

participates in one commodity trade agreement: the International Tropical Timber Agreement. The agreement establishes an intergovernmental organization with a governing council. The

Office of the United States Trade Representative The Office of the United States Trade Representative (USTR) is an agency of the United States federal government responsible for developing and promoting United States foreign trade policies. Part of the Executive Office of the President, it ...

leads US participation in this agreement.

International Coffee Agreement

The

International Coffee Organization The International Coffee Organization (ICO) was set up in 1963 in London under the auspices of the United Nations (UN) due to the economic importance of coffee. It administers the International Coffee Agreement (ICA) which is an important instrum ...

(ICO) is the main intergovernmental organization for

coffee Coffee is a beverage brewed from roasted, ground coffee beans. Darkly colored, bitter, and slightly acidic, coffee has a stimulating effect on humans, primarily due to its caffeine content, but decaffeinated coffee is also commercially a ...

. ICO exporting members account for more than 97% of world coffee production, and its importing Members, are responsible for around 80% 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 efforts circa 2007 to renegotiate the ICA, resulting in the adoption of the seventh

International Coffee Agreement The International Coffee Agreement (ICA) is an international commodity agreement between coffee producing countries and consuming countries. First signed in 1962, it was originally aimed at maintaining exporting countries' quotas and keeping co ...

(ICA 2007) 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.

International Tropical Timber Agreement

The

International Tropical Timber Agreement The International Tropical Timber Agreement (ITTA), 1983) is an agreement to provide an effective framework for cooperation between tropical timber producers and consumers and to encourage the development of national policies aimed at sustainable ...

(ITTA) is often described as a "hybrid" agreement because it combines a traditional commodity trade agreement with objectives that include sustainable management of tropical forests. The ITTA established the

International Tropical Timber Organization The International Tropical Timber Organization (ITTO) is an intergovernmental organization that promotes conservation of tropical forest resources and their sustainable management, use and trade. Organization The organization was established und ...

(ITTO), an intergovernmental organization with 59 members who collectively account for about 80% of the world's tropical forests and 90% of the annual trade in tropical timber trade. The ITTO promotes market transparency by collecting, analyzing and disseminating data on the production and trade of tropical timber; assists in developing, funding and implementing projects and other activities to build capacity to sustainably manage and use tropical forests; and facilitates intergovernmental consultation and international co-operation on issues relating to the trade and utilization of tropical timber and the sustainable management of its resource base. Negotiations for a successor agreement to the ITTA 1994 were concluded in 2006, and the new agreement (ITTA 2006) is expected to further strengthen efforts to promote tropical timber trade in the context of sustainable management of tropical forests.

References

* {{DEFAULTSORT:International Commodity Agreement Commercial treaties Trade by commodity