USDA analysis of EU cereals market
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CTA. 2002. USDA analysis of EU cereals market. Agritrade, August 2002. CTA, Wageningen, The Netherlands.
Permanent link to this item: http://hdl.handle.net/10568/52723
At the end of 2001 the USDA Foreign Agricultural Service reported a...
At the end of 2001 the USDA Foreign Agricultural Service reported a dramatically smaller EU crop and little demand for EU wheat given the relative high price of unsubsidised EU wheat compared to the abundant supplies of cheaper wheat from eastern Europe. As a consequence in 2001 EU exports of wheat were down 30% compared to 1999. Indeed, falling EU import duties and relatively high internal prices were stimulating flows of wheat into the EU. This trend continued into 2002. In February 2001 the USDA FAS reported that the EU was importing unusually large quantities of wheat, barley and rye, Import licences for the first six months of 2002 have therefore exceeded export licences. In 2002 EU barley imports are expected to double, while the EU is now expected to become one of the world's largest importers of rye, despite its continued status as one of the world's largest exporters, and the fact that it is holding 5 million tonnes of rye in intervention stocks. Comment: No explanation is offered for this paradoxical situation on the EU cereals market. This could be a transitional situation arising from the process of reform and the uncertainties which arise when markets are increasingly exposed to world market prices, even on the basis of large levels of direct aid payments. The current situation on the EU cereals market is raising concerns over the impact of the US Farm Bill on world markets.