The majority of domestic policy initiatives concerned with the grains sector during the 1999-2000 season were, in general, in response to low international grain prices, high input costs and weather problems. In many developing countries, attempts to increase incentives to producers through price support continued, although, at the same time, a number of economic influences tended to create upward pressure on input prices and weather-induced crop failures reduced producer returns. In the developed countries, new policy initiatives for grains reflected adjustments within broad policy programmes previously adopted by countries, including the EC's Common Agricultural Policy (CAP) and the FAIR Act in the United States. Within these programmes, the most significant policy change involved a shift from price support measures to direct fiscal transfers designed to support farm incomes.
Under the URAA, the trend toward reducing barriers to trade, together with a general tendency to liberalise domestic market activities has continued in many countries. An additional feature of trade policies over the past year, including those affecting grains, has been the progress toward strengthening regional trading agreements.
In many countries, production support policies followed the established pattern of recent years; both in improving price, credit, and debt relief measures, on the one hand and, in increasing direct income transfers, on the other. However, in areas experiencing intense civil conflicts and weather problems, the pace of reform was stalled. In several countries, the increased support was geared toward enhancing farm income adversely affected by bad weather, low international grain prices and high-energy costs.
In Africa, many countries continued to strengthen producer support policies and, in some cases, to re-align them to make them more compatible with ongoing structural reforms. However, countries had various responses to short-term developments, depending on their economic circumstances. Morocco, experiencing the worst drought in over a decade, allocated about US$ 631 million in March 2000 to improve water supplies to grain producing areas and to help cover the cost of increased imports in 2000/2001. In response to high fuel prices, the Governments of Mozambique and Sudan increased the price of diesel by 25 and 27 percent, respectively, whereas in Namibia, the Government increased the per litre rebate on diesel fuel sold to farmers by 60 percent. In Tunisia, to encourage producers to improve yields, the Government, for the first time since 1996, increased producer prices in late 1999 for both durum and common wheat by US$ 7 per tonne to US$ 210 and US$ 185, respectively.
Longer-term solutions were sought by others such as Egypt, where the Government launched a project, in 2000, valued at US$ 87 billion dollars, the first phase of which aims to reclaim 400 000 hectares of agricultural land from desert by 2017. Much of land reclaimed under this project will be utilised for grain cultivation. The Government will provide 25 percent of the estimated cost with the private sector providing the rest.
Among the Asian countries, the minimum support prices (MSP) for grains where increased in India for the 2000/2001 marketing year (Table II-1). For wheat, the MSP was increased by 5 percent to US$133 per tonne and for barley by 10 percent to US$99 per tonne. The MSP is the price at which the government purchase grains from producers. In July 2000, the Government introduced a crop insurance scheme for maize and other crops. The main objective of this scheme is to assist farmers to manage the risk of crop failures. All farmers who have taken loans from financial institutions, including tenant farmers, are eligible for the insurance programme.
In May 2000, the Islamic Republic of Iran provided loans of about US$ 183 million to help farmers (including grain farmers) affected by drought. Government-owned banks were authorised to exercise flexibility on penalties for delays in loan repayments for up to two years. In Pakistan, to cushion the effects of rising production costs, the support price for wheat was increase by 25 percent to 7 500 rupees (US$144) per tonne between the 1998/99 and 1999/2000 seasons.
In Jordan, which became a WTO member in April 2000, the Government abolished its system of announcing administered prices for wheat and barley prior to the planting season. In Turkey, support prices during the 1999/2000 season remained unchanged for most grains, except for durum wheat, which was slightly decreased.
Within the Latin American and Caribbean region, the Government of Brazil, in August 1999, announced a plan to provide debt relief for up to 80 percent of all loans owed to the government by farmers, including grain farmers. The plan allows for farm debts of up to US$ 5 000 to be discounted by 30 percent and those of up to US$100 000 to receive a 15 percent reduction. In late 1999, the Government announced a series of measures aimed at increasing self-sufficiency in maize, including an allocation of US$ 251 million in loans to help cover input costs. Although sowing of the main crop had already been completed, the loans boosted the area of late sown maize. In addition, a credit facility amounting to US$ 448 million was extended for 2000, to be followed by the same amount in 2001. The loans are to be repaid over 6-8 years with interest rates of 8.75 -10.75 percent, with the lower rate applying to smaller farms. Income relief measures were announced in 2000 to offset the cost of crop losses, including for grains, due to frost in some parts of the country. Up to about US$ 690 million in credit was allocated to finance the purchasing of inputs. For producers affected by the frost, the Government relaxed the repayment conditions on all existing farm debts.
The Government of Jamaica, in late April 2000, provided about US$ 2 million to farmers (including grain farmers) hard hid by drought. This amount was in addition to a programme worth almost US$ 5 million authorised by the Government through the state-owned Peoples Co-operative Banks to re-schedule loan payments of farmers affected by the drought.
Within Europe, the European Community (EC) reduced the intervention price for grains by 7.5 percent as stipulated under its Agenda 2000 CAP reform.19 However, the monthly storage subsidy payment, which was slated to be reduced from 1 to 0.93 euros per tonne in 2000/2001, was postponed to take effect in the 2001/2002 season. Candidate countries for EC membership20 made significant progress in aligning the policies affecting their agricultural sectors to those of the CAP. However, severe weather problems, high fuel costs and low international grain prices prompted several governments to increase budgetary outlays to support domestic producers.
Table II-1: Average grain support prices in selected countries (price per tonne)
Countries |
Prices in National Currencies |
|||||||||
Nominal Prices |
Real Support Prices (deflated by CPI, 1995=100) |
Prices in US Dollars | ||||||||
Currency |
1998/99 |
1999/00 |
2000/01 |
1998/99 |
1999/00 |
2000/01 |
1998/99 |
1999/00 |
2000/01 | |
Developed Countries |
||||||||||
Czech Republic |
|
|
|
|
|
|
|
|
|
|
Europ. Com. (a) |
|
|
|
|
|
|
|
|
|
|
Hungary |
|
|
|
|
|
|
|
|
|
|
Japan |
|
|
|
|
|
|
|
|
|
|
Norway |
|
|
|
|
|
|
|
|
|
|
Poland |
|
|
|
|
|
|
|
|
|
|
United States (b) |
|
|
|
|
|
|
|
|
|
|
D.ping Countries |
||||||||||
India |
|
|
|
|
|
|
|
|
|
|
Mexico |
|
|
|
|
|
|
|
|
|
|
Tunisia |
|
|
|
|
|
|
|
|
|
|
Zimbabwe |
|
|
|
|
|
|
|
|
|
|
n.a. not available (a) intervention prices (b) loan rates Source: Official reports and OECD
In August 2000, Bulgaria's State Fund for Agriculture provided about 8 million levs (US$ 3.5 million) as income support for grain producers. In Croatia, where a large proportion of the land under grain cultivation was declared a natural disaster area because of severe drought in 2000, the Government provided financial incentives to farmers to take out commercial insurance against damage to crops and farmland.
In the Czech Republic, as a result of drought which resulted in huge income losses and affected over one million hectares of land, mostly planted with grains, starting 1 April 2000, farmers were eligible for a 60 percent rebate on excise taxes paid on fuel and lubricants purchases, and were granted free water for irrigation. This was financed by a 5 billion korunas (US$ 120 million) compensation package, which was also used to provide preferential interest loans to farmers with economically viable investment projects. In addition, a direct subsidy of 200 million korunas (US$ 5 million) was made available to farmers who provided certified evidence of damage, while their rent on state-owned land was reduced by 10 percent. In its bid to align its agricultural sector to that of the EC, the Government plans to set aside up to 10 percent of all arable land, stating in 2001.
The Government of Estonia plans to increase its direct subsidy payments to grain farmers by about 296 million kroons (US$ 16 million) in 2001, reflecting a 25 percent increase over the subsidies granted in 2000. The amount allotted for 2001 will be further augmented by 63 million kroons (US$ 3.4 million) from the EC pre-accession aid scheme.
The Government of Hungary, in its 1999/2000 budget allocations, increased the amount of subsidy provided to agricultural producers by about 40 percent compared to that of the previous year to about 140 billion forints (US$ 46 million). The higher subsidy was geared toward farmers affected by drought and high energy prices. Grain producers were offered per hectare subsidy payments based on land size. Payments ranged from 12 000 forints (US$39) per hectare for grain producers with 20 hectares or less, to 4 000 forints (US$13) per hectare for farms over 50 hectares. An additional sum of 90 billion forints (US$ 30 million) was earmarked as subsidy payments in 2001.
In late 1999, the Government of Lithuania replaced its system of setting minimum guaranteed prices with one in which prices are generally freely determined by market forces. However, to protect domestic producers from low grain prices, an intervention (floor) price mechanism was introduced as part of this policy. Intervention prices for the 1999/2000 season were set at 430 litas (US$107) per tonne for wheat, 330 litas (US$83) per tonne for rye and 800 litas (US$200) per tonne for buckwheat. These prices were exclusive of the normal value-added tax of 18 percent. Furthermore, the Government introduced a compensation scheme for the interest on loans. Interest rates were reduced by 50 percent on loans granted to purchase farm machinery, which carries an interest of 12 percent or less. For other farm-related loans, the interest rate reductions were up to 30 percent.
In Poland, the minimum support prices of bread wheat and rye were lowered by 11 percent to US$114 and US$81 per tonne, respectively, between the 1998/99 and 1999/2000 seasons.21 In 2000, the Government, in its bid to improve the quality of grain seeds used for planting, increased the seed subsidy by 23 percent to US$40 per tonne for wheat and by 8 percent to US$35 per tonne for barley. In addition, to help cushion the effect of higher oil prices on farmers, the Government introduced a special voucher in late 2000 that could be used as partial payment for fuel.
In late 1999, the Government of Romania increased the minimum guaranteed prices for wheat by 50 percent to US$90 per tonne and for maize by about 58 percent to US$78 per tonne. About US$ 16 million was provided as direct subsidy to grain producers to help cover fuel costs. The Government expects to recover this amount through taxes on the sales of surplus grains.
Among the CIS Republics, in July 2000 the Russia Federation announced a package of reforms as a part of its long-term agricultural policy programme, which will run from 2001 to 2010. The main components of the reform measures include the following: (a) the creation of a federal grain reserve and market support mechanism to regulate the market; (b) the establishment of a flexible import duty system to improve customs controls; (c) a federal farm insurance set-aside programme that will retain 5 percent of the total amount of insurance pledges made to the agricultural sector; and (d) a restructuring of all farm debt owed to the state.
In Norway, the administered price of rye used for feed was reduced by about one percent to US$248 per tone for the 1999-2000 season. On the other hand, area payments for all grains were increase by about 3-6 percent in addition to a one-time lump-sum payment of US$14 per hectare of agricultural land. Excise taxes on nitrogen and phosphorus fertilizers were abolished from January 2000.
The Australian Wheat Board (AWB) announced a new funding option, providing immediate relief to wheat growers affected by adverse weather in 2000. The new funding arrangement provided growers with the possibility to extend their 1999/2000 Harvest Payment loan and request up to 75 percent of their estimated remaining equity in the 1999/2000 National Pools. Farmers who delivered wheat into the Australian Hard Pool were eligible for an additional loan of around AU$16 (US$9) per tonne. Growers who delivered wheat into the Number Two Pool would receive a higher payment.
Most governments continued the trend of liberalising their markets mainly to improve efficiency and stabilise domestic grain markets. Consumption support policies already in place were continued without any significant changes, with a few exceptions.
In Asia, the Government of India, in trying to reduce a large accumulation of wheat stocks resulting from a good harvest, auctioned about 5 million tonnes of wheat for use in the domestic market, in June 2000. Furthermore, in August of the same year, the Government reduced the selling price for wheat under its open market sales scheme in the northern parts of the country. A price reduction of about 38 percent was in effect for the months of August and September. However, the reduced price was only applicable for wheat purchased from stocks held by the Food Corporation of India (FCI). The Government also increased the number of families eligible for subsidised food distribution from 60 to 65 million and increased the amount of grains supplied to its various welfare programmes, including donations of food aid. In addition, the issue prices for wheat channelled through the Public Distribution System (PDS) was reduced by 8 percent for the population below the poverty line and by 4 percent for those above the poverty line.22
In February 2000, the Turkish grain marketing agency (TMO), in its bid to reduce wheat stocks, introduced a scheme whereby millers were offered a concessionary price if they purchased the wheat equivalent of their previous level of flour exports from the agency. Concern about millers withholding wheat from the domestic market prompted this change. In early 2000, the Government of Yemen, as part of an ongoing reform programme, granted license to establish two privately owned flourmills.
In Latin America and the Caribbean, the Government of Argentina started a national grain registration programme in September 2000, to measure crop quality and quantity in distinct zones of the country. This registry is expected to help improve tax collection and the identification of factors that cause market distortions. In February 2000, Brazil announced that a sum of US$ 1.6 billion was to be allocated to regulate the marketing of 12 million tonnes of grains and oilseeds. Under this package, about US$ 62 million in official loans were used to finance the purchase of commodities, including wheat, maize and rice, with a further option to spend US$ 674 million to purchase other food commodities. In late 1999, the Government of Mexico, reduced the authority of its state marketing agency, CONASUPO, and allowed the private sector to import, market and to purchase maize directly from producers. However, the allocation of the maize import quota is still under the authority of CONASUPO.
In Europe, the Government of the Czech Republic, in a bid to stabilise the domestic prices of wheat flour in 2000, bought milling wheat from domestic producers without the application of the value-added tax. A price of 3 300 korunas (US$80) per tonne was offered, which was about 18 percent higher than the intervention price in the previous season. However, prospective sellers were obliged to deliver the wheat at their own expense, but were compensated if the wheat is sold to millers at a price higher than that which they were offered. In July 2000, the Parliament approved a bill that would allow grain producers to use grain delivered to certified warehouses as collateral for bank loans. The warehouse certificates received from storing grains can also be traded on the futures market. For private sector warehouses to be certified under this new law, they must have a minimum capital of 30 million korunas (US$ 730 000).
To help control fiscal expenditure, Poland abolished its previous intervention (public storage) programme, which had been in existence since 1992, and instituted a new intervention programme in July 1999. Under this new programme, an intervention price was set for grain procurement with a compensatory direct payment. Farmers who choose to sell their grains to millers and wholesalers selected by the Agricultural Marketing Agency (AMA), in addition to the minimum prices received, were eligible for the AMA's average monthly compensatory payments of US$22 per tonne for wheat and US$14 per tonne for rye. However, if domestic market prices exceeded the minimum price, then the AMA compensatory payments were adjusted to reflect the difference between the average domestic market price and the minimum price.23 In August 2000, the Government of Romania, to offset the effects of a severe drought, offered a bonus of US$21 per tonne to wheat producers to deliver up to 1.5 million tonnes of milling wheat from their 2000 harvest to licensed bakeries and elevators.
In July 2000, the Government of Ukraine authorised the purchase of about 500 000 tonnes of grains from producers, at prices ranging from US$66 per tonne for maize and rye, to US$77 per tonne for wheat. This intervention was aimed at stabilising the domestic market and to prevent exports at very low prices. However, producers were given the option to buy back their grain from the State at the same prices, plus the cost of storage, when market conditions permitted.
In North America, the Government of Canada established a new programme in September 2000, to provide early payments to barley producers, geared toward guaranteeing the delivery of feed barley by the end of 2000 so that sales commitments could be met. In addition, the Canadian House of Commons approved a bill aimed at reforming the country's grain transportation sector. The new legislation establishes a maximum reduction in rail revenues of about C$ 178 million (US$ 118 million), reflecting an 18 percent drop in grain freight rates beginning in the 2000/2001 season. The legislation also authorises the Canadian Wheat Board (CWB) to issue tender bids for the logistical services of grain shipments for up to 50 percent of its total grain volume, by 2002/2003. The Government will also provide about C$ 175 million over 5 years to upgrade its road transport networks.
In February 2000, the United States Department of Agriculture (USDA) opened a tender for commodity certificates in a bid to encourage producers to redeem outstanding marketing loans on grains rather than surrender ownership to the Commodity Credit Corporation (CCC). With the certificate, any producer with loans of US$ 150 000, which is the maximum amount granted, can retain the difference between the selling price and officially calculated local market price for that specific grain. A producer facing the possibility of forfeiting grain pledged as collateral on marketing loan will also be able to purchase a certificate up to the value of the loan. The certificate could then be exchanged for the commodity under loan so that the producer can retain ownership and the loan is redeemed. The redemption price for a certificate will be equivalent to the Posted County Price (PCP) for the location where the certificate was purchased. Exchanges will not be permitted if the PCP exceeds the loan rate. Furthermore, in May 2000, the USDA provided loans to help grain producers upgrade their on-farm storage facilities. Up to 75 percent of the net cost of upgrading the storage facilities were financed by the loans, with a maximum limit of US$ 100 000 per applicant for each fiscal year. The interest on the loans was set at 6.25 percent and a total amount of about US$ 350 million was allocated for the first year of the programme.
In early 2000, the Government of China offered subsidies to grain farmers in the western parts of the country to convert cultivated lands into forests or grasslands. The policy is designed to counteract environmental damage, especially soil erosion. Participating producers will receive a one-time payment of US$90 and annual payments of US$36 per hectare of land enrolled in the programme. The annual payments will be available for 5-8 years, depending on whether the cultivated land is converted into forest or grassland.
In October 2000, the United States Government announced an incentive programme worth US$300 million to expand production of fuels from designated grains and other crops. A ten-year pilot project was also announced to distil alcohol from plant biomass grown on land enrolled in the Conservation Reserve Programme (CRP), which is largely comprised of grains. An area limit of 101 178 hectares was set with individual farmers allowed to enrol up to 20 236 hectares. Furthermore, in May 2000, the USDA announced that an additional 610 000 hectares of farmland would be accepted for enrolment in the CRP,24 which is planned to increase from about 15 million to 16 million hectares. Farmers were offered an average payment of US$128 for each hectare of land signed up in the programme.
Depressed international grain prices and weather problems were the main factors underlying the grain trade policy environment during the period under review which prompted several governments to reverse the trend of grain trade liberalisation; however, in some countries facing severe weather problems, import tariffs were reduced. At the same time, most governments made significant strides in finalising their commitments under the Uruguay Round Agreement (URAA) and continued to formulate policies to meet further reforms expected during the on-going round of multilateral trade negotiations.
In Bangladesh, the Government halted the importation of grains during its fiscal year 1999/2000 (July/June) because of excess grain supplies and huge domestic stocks. The import duty on private grain imports was increased by 5 percent to discourage private traders from importing grain. On 16 June 2000, the Government of India, to protect it domestic farmers from lower priced imports, introduced a tariff-rate quota (TRQ) for maize. In the previous year, duty-free maize imports were allowed under an open general license. Under the new scheme, maize imports, whether for use as feed or food, were subject to a quota volume of up to 350 000 metric tonnes, with a duty of 15 percent. Imported quantities above the quota were subject to a 50 percent duty. In the following October, the in-quota volume was increased to 500 000 tonnes. At the same time, the import duties on sorghum and pearl millet were increased from zero to 50 percent.
In October 2000, the Government of the Philippines allowed millers to import high quality maize at a lower import tariff of 35 percent instead of the normal duty of 65 percent. Heavy rains during the proceeding months, which damaged and in some cases prevented drying of maize, prompted the move. Similarly, between March and June 2000, Thailand allowed maize imports above its monthly quota of 53 543 tonnes and waived the import surcharge of US$4.70 per tonne, to boost domestic supplies. However, the normal import duty of 76.2 percent was still applied. The Government of Saudi Arabia announced in May 2000, that the current unloading fee of US$1.60 per tonne for imported barley would be abolished until March 2001. In January 2000, the Government of Vietnam provided a list of commodities and their tax rates for the implementation of the agreement on Common Effective Preferential Tariffs (CEPT) of the ASEAN group of countries. 25 For wheat, including durum, and maize seeds, both the preferential and CEPT tariffs were abolished, while for rye, barley and oats, they were set at 3 percent. For maize, other than seed, the rate was set at 5 percent. Tariffs on value-added grain products ranged from between 5 and 20 percent.
The Government of Brazil lifted its import ban on two types of US wheat (hard red spring and soft red winter) in November 2000. The ban had been in place since 1996 because of the risk posed by TCK smut, a fungal disease. Wheat imported from countries outside the MERCOSUR 26 region carries a duty of 13 percent. In September 1999, the Government of Colombia reduced the import duty on maize under the Andean Community price band system from 80 percent to 37 percent due to rising feed and food costs.27
In late 1999, the Government of Malawi finalised its reform programme for grains by abolishing the import duty on farm machinery and allowed local private companies to compete in the input supply market with international companies. In addition, the Government replaced its price band system for maize with an indicative price system, to reflect domestic market conditions. Previously, prices of all grains had been liberalised, except maize, which was still subjected to a price band mechanism.
In late 2000, because of shortages caused by a severe drought, the Government of Bulgaria announced plans to abolish its import duties on wheat and barley from January to June 2001. After this period, the normal import tariff for barley would be reduced by 5 percent to 15 percent. The import tariff on durum wheat would be lowered from 18 to 15 percent and for maize, from the normal 20 to 15 percent specifically during October to December 2001.
In compliance with its URAA obligations, the Czech Republic adjusted its import duties for grains as follows: the import duty was reduced from 21.8 percent in 1999 to 21.2 percent in 2000 for common wheat, rye, barley and oats. The duty on maize (other than for seed, which is now duty-free) was reduced from 17.5 percent in 1999 to 17 percent; and for durum-wheat, the duty was reduced from 3.7 percent in 1999 to 3 percent in 2000.
In January 2000, the Government of Poland revised its tariff-rate quota regime for common wheat by reducing its above-quota tariff and (URAA) bound tariffs by 6 percent to a level of 64 percent, or 100 euros, whichever is lower (Table II-2). The in-quota tariff rate of 25 percent was unchanged. Furthermore, the 20 percent tariff applied for durum was reduced to 3 percent until the end of December 2000 for imports from non-EC countries. For EC member states, the tariff was set at 1.5 percent. At the same time, the preferential rate of 15 percent was maintained for wheat imports from Slovenia, Romania, Bulgaria and Lithuania, under the Central European Free Trade Association (CEFTA).28 However, to lessen the impact of low international grain prices on the domestic market, the Government invoked the Special Safeguard clause (SSG) 29 in March 2000 and set import threshold prices at the following levels: for wheat, US$149 per tonne; barley, US$112 per tonne; rye, US$128 per tonne; and oats, US$48 per tonne.
In addition, Poland established country specific import quotas for some of its EFTA trading partners. In May 2000, tariff rate quotas were set for the import of 130 000 tonnes of wheat from Hungary and the Czech Republic. The Government also set up a specific import duty for the importation of 40 000 tonnes of wheat and 17 000 tonnes of maize from Slovakia. 30 At the same time, faced with an acute shortage and rising prices of maize, the Polish Government established generalised grain import quotas. A duty-free quota was established for 135 000 tonnes of maize to be imported by the end of December 2000. Furthermore, in August 2000, the Government allowed imports of around 800 000 tonnes of wheat duty free, equally divided between the public and private sectors, following huge export sales from intervention stocks during the previous season. A duty-free import quota was also set for 100 000 tonnes of rye, while 200 000 tonnes of other grains (mostly maize) were allowed to be imported duty-free by private sector importers.
Under the "double-zero" agreement between the EC and the ten Central and East European countries reached in 2000 (see Box IV-2), the EC and Poland agreed to initially establish a duty-free quota of 10 000 and 40 000 tonnes of flour and wheat, respectively. The quota will be raised by 10 percent annually.
Table II-2: Poland's tariff-rate quota scheme for grain imports, 1999-2000
Commodity |
Tariff quota (metric tonnes) |
In-quota tariff rate (% ad valorem) |
Above-quota rate (ad valorem or euros/tonne) |
URAA bound rate (% ad valorem or euros/tonne) | ||||
1999 |
2000 |
1999 |
2000 |
1999 |
2000 |
1999 |
2000 | |
Common wheat Durum wheat |
388 000 |
388 000 |
25% 3% max. |
25% 3% max. |
70% or 110 euros/t 20% |
64% or 100 euros/t 20% |
70% or 110 euros/t 27.5% |
64% or 100 euros/t 25% |
Rye |
0 |
30 000 |
0 |
0 |
20% |
20% |
55.8% or 110 euros/t |
51% or 100 euros/t |
Barley |
0 |
40 000 |
0 |
0 |
20% |
20% |
55.8% or 110 euros/t |
51% or 100 euros/t |
Oats |
0 |
30 000 |
0 |
0 |
20% |
20% |
41.7% |
38% |
Reciprocal agreements with the EC |
||||||||
Common wheat |
0 |
40 000 |
0 |
15% |
0 |
64% or 100 euros/t |
70% or 110 euros/t |
64% or 100 euros/t |
Maize |
80 000 |
165 000 |
0 |
0 |
20% |
20% |
14% or 110 euros/t a/ |
12.8% or 100 euros/t a/ |
a/ The maximum of the two rates.
Source: Polish Government.
In late 2000, Romania waived its import duties on up to 500 000 tonnes of feed maize until the end of June 2001. The duty-free imports were aimed at re-building stocks and helping to ease the tight supply situation in the feed market. In the Ukraine, because of a bumper maize crop, the Government announced in late 2000, that it would limit maize imports to 500 000 tonnes until the end of the year.
The Government of Canada imposed a provisional anti-dumping and countervailing duty of C$66 (US$4) per tonne on imports of maize from the United States. The preliminary results of a special investigation indicated that US maize was on offer at prices considered to be, on average, below profitable levels. The Customs and Revenue authorities would make a final decision on dumping and subsidisation early in 2001 and the final determination on injury by the Canadian International Trade Tribunal will be made thereafter.
Bangladesh, in an attempt to dispose of its huge wheat stocks, announced in early 2001 plans to allow private firms and co-operatives to export wheat through tender bids.
In late 2000, the Czech Government increased its export quota for bread wheat from 50 000 to 200 000 tonnes. Restrictions on exports had been imposed earlier in the year to prevent an expected shortfall of wheat on the domestic market. As a result of poor grain harvests, Hungary banned the exporting of maize and instituted duty-free import quotas for barley and oats in November 2000 for up to 100 000 tonnes of oats and 20 000 tonnes of barley.31 However, in early 2001, the ban on food maize export was lifted, but feed maize exports were still prohibited.
The United States announced a programme, in November 1999, to assist exporters to provide samples of their products to potential buyers in foreign markets. The Quality Samples Programme (ASP), valued at US$ 2.5 million, focused on non-branded products, including processed or semi-processed grains and other agricultural products that are not in ready-to-eat form. The ASP participants must purchase and export commodity samples and provide technical assistance on their use to importers. When the project is finalised, the Government will reimburse the costs of buying and exporting the sample.
From the review presented in this chapter, the main factors that drove policy responses in the grains sector over the past year were low international prices, high energy costs and adverse weather. However, most countries continued the trend toward liberalising their domestic grain markets in accordance with commitments already made under structural adjustment reform programmes and the URAA.
Over the past year, in the face of depressed grain prices, many governments increased budgetary outlays to provide relief to producers in the form of higher support prices, input subsidies, expanded credit facilities and direct income transfers. In some countries, crop insurance programmes were also given renewed emphasis to assist farmers to manage production-related risks. Among other countries, reforms were stalled as a result of the market conditions noted above. Overall, policy responses over the review period varied, depending on the grain supply situation in the respective countries. For countries with excessive grain supplies, the policy responses were along the following lines: price discounts were offered in the domestic marketing of grains; import duties were increased and temporary import bans were enacted; tariff-rate-quota schemes were established with tight quota quantity and/or higher quota tariffs; increased private sector participation in grain trade and increased expenditure outlays to stabilise domestic grain markets were provided. For countries facing grain shortages, policies were enacted to ease import controls and/or to restrict grain exports.
19 See Cereal Policies Review, 1998/99.
20 The candidate countries for EC accession include Bulgaria, the Czech Republic, Estonia, Hungary, Lithuania, Latvia, Poland, Romania, Slovenia and Slovakia.
21 The minimum prices of wheat and rye were increased by 11 and 13 percent, respectively, in 1998. For more details, see Cereal Policies Review, 1998/99, p. 5.
22 For more details, see Cereal Policies Review, 1997-98, Chapter 3.
23 The minimum prices of wheat and rye were increased by 11 and 13 percent, respectively, in 1998; see Cereal Policies Review, 1998/99, page 5, for more detail.
24 See Cereal Policies Review, 1995-97.
25 The ASEAN members are Brunei, Cambodia, Indonesia, Laos, Malaysia, the Philippines, Singapore, Thailand and Vietnam.
26 The member States of MERCOSUR are Argentina, Brazil, Paraguay and Uruguay. Bolivia and Chile are associate members.
27 See Cereal Policies Review, 1993-94, Chapter 2.
28 CEFTA members are Bulgaria, The Czech Republic, Hungary, Poland, Romania, Slovenia, and Slovakia.
29 See: The Results of the Uruguay Round of Multilateral Negotiations: The Legal Text, pp 315-324.
30 The duty was set at 15 percent for wheat but maize imports were duty-free.
31 The normal rate of import duty for barley is 32.8 percent and 32 percent for oats, whereas the preferential rates for CEFTA members are 18 percent for barley and 15 percent for oats.
