EC soft wheat export commitments; changing pace and mechanism - European Community shows growth in early season soft wheat sales; comparisons from 1989-1992 - U.S. Dept. of Agriculture, Foreign Agricultural Services report - Illustration

EC Soft Wheat Export Commitments

Changing Pace and Mechanism

Contrary to the perception that the European community (EC) has not had an aggressive soft wheat sales program this year (July/June), this month's cover graph shows that the early season sales pace has, in fact, been greater than last year. Licenses, which closely correspond to export sales, are 12 percent higher this year through early December than in a comparable period last year, and far above 1989/90. At least part of the reason for the misperception is that sales from free market channels are well behind the level reached by this time in previous years. However, there has been a dramatic increase in the use of direct sales from government intervention stocks, which this year account for nearly half of total commercial soft wheat export commitments so far. The graph suggests another import change taking place in the EC marketing system; that is the increased emphasis on early season sales. In 1989/90, the EC sold less than 50 percent of its total soft wheat exports by early December, whereas, by this time last year, sales had already exceeded 60 percent, and a similar rate appears to be developing this year. The increasing pace of EC sales could also give the impression that competitive measures taken by the United States are becoming less effective in countering EC export subsidies. However, it is, rather, the reduced production and stocks in Australia, Argentina, and the United States this year in the face of near-record import demand that have provided increased export opportunities for the EC, which has record wheat supplies.

COPYRIGHT 1991 U.S. Department of Agriculture
COPYRIGHT 2004 Gale Group