The executive director of the National Farmers Federation, Mr Lyall Howard, said the proposed US farm subsidies were "very depressing for us" but that the US Congress was "out of control".

Australia's wheat, sugar, cotton, corn, rice and dairy industries are threatened by aggressive new US farm subsidies under discussion in Congress, according to the Australian Government and industry officials.

And the possibility of future benefits to Australian sugar and citrus from pending global trade talks are also in jeopardy, because of measures in another US bill enacted last week, the Trade Promotion Authority law.

An Australian delegation led by the Federal Agriculture Minister, Mr Warren Truss, arrived in Washington this week, more than two months after the US House of Representatives passed a bill to create a 10-year program of farm subsidies totalling $US73.5 billion ($142 billion).

The US Senate is this week negotiating over an alternative bill, just as protectionist but shorter-lived - a five-year program worth $US41 billion.

The Bush Administration has made some effort over the past two months to curb the extremes of Congressional agricultural protectionism, but the President has decided not to attempt a veto on the bill.

After meeting Administration officials, Mr Truss said on Tuesday that it was "something of a concern to Australia and our Cairns Group partners that the US is currently considering a farm bill which will ... entrench a level of subsidy dependence in US agriculture for perhaps a generation".

The NFF president, Mr Ian Donges, said yesterday the proposals included a substantial increase in funding and in direct production subsidies.

"This is a totally retrograde step," he said. "It's taking us back to the worst excesses of the mid-1980s."

Mr Donges said the proposal also represented a setback after the good result at the recent talks in Doha, Qatar, in setting a framework for the next round of world trade negotiations.

The chief executive of the Queensland-based Canegrowers organisation, Mr Ian Ballantyne, said US sugar producers were being paid about three times the world price of sugar. It had been estimated that removal of support measures in the US would cut sugar production by four million tonnes, significantly boosting world prices.