By Tom Gibb
BBC News, Brasilia
President George W Bush has told his Brazilian counterpart, Luiz Inacio Lula Da Silva, that the US will work towards eliminating its agricultural subsidies.
President Lula spoke of a growing Brazilian-American partnership
This, he said, was fundamental to move towards free trade around the world.
However, the move would depend on European willingness to do the same thing, Mr Bush said.
And in an apparent swipe at Venezuelan President Hugo Chavez, he accused some nations of rolling back the democratic progress of the last 20 years.
Mr Bush gave his vision for the economic and democratic development of the Americas in a speech later on Sunday to political and business leaders in Brasilia.
On his way to meetings in the Brazilian capital, Mr Bush drove past a small but noisy group of protesters who shouted insults and burned his effigy.
Both presidents gave short statements before sitting down to a barbeque together at the Brazilian presidential retreat.
Protesters made their anti-US feelings clear
President Lula spoke of a growing partnership between the two presidents for whom this is their third meeting.
He said a shared vision of democracy, the spread of liberty and human rights allowed them to discuss their differences over free trade with respect and frankness.
He said they both agreed that eliminating US and European farm subsidies, which he said makes trade unfair, was the key to success in upcoming World Trade Organisation (WTO) talks.
In reply, President Bush promised to work together with Brazil to do this but he said the US could only reduce subsidies to its farmers if Europe were willing to do the same.
In the main speech of his Latin American tour later in the day, Mr Bush warned of countries that sought to roll back the democratic progress by playing on fear, pitting neighbour against neighbour and blaming others for their failures.
"A country that divides into factions and dwells on old grievances move forward and risks sliding back into tyranny," Mr Bush said.
"A country that unites all its people behind common ideals will multiply in strength and confidence."
At the recent summit of the Americas in Argentina, Mr Bush had avoided talking about President Chavez, despite inflamed speeches from the Venezuelan leader blaming US interference for Latin America's ills.
President Bush is now on his way to Panama, the last stop of a brief tour in Latin America.