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

Commodity

In economics, a commodity is the generic term for any marketable item produced to satisfy wants or needs. Economic commodities comprise goods and services....

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

Stock management

Stock management is the function of understanding the stock mix of a company and the different demands on that stock. The demands are influenced by both external and internal factors and are balanced by the creation of Purchase order requests to keep supplies at a reasonable or prescribed...

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

Information exchange

Information exchange is an informal term that can either refer to bidirectional information transmission/information transfer in telecommunications and computer science or communication seen from a system-theoretic or information-theoretic point of view....

, analysis

Analysis

Analysis is the process of breaking a complex topic or substance into smaller parts to gain a better understanding of it. The technique has been applied in the study of mathematics and logic since before Aristotle , though analysis as a formal concept is a relatively recent development.The word is...

, and policy

Policy

A policy is typically described as a principle or rule to guide decisions and achieve rational outcome. The term is not normally used to denote what is actually done, this is normally referred to as either procedure or protocol...

 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 .

International Coffee Agreement

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.

International Tropical Timber Agreement

The International Tropical Timber Agreement (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

International Tropical Timber Organization

The International Tropical Timber Organization is an intergovernmental organization that promoted conservation of tropical forest resources and their sustainable management, use and trade.-Organization:...

(ITTO), an intergovernmental organization with 59 members who collectively account for about 80 percent of the world's tropical forests and 90 percent 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.