U.S. sets initial wheat export subsidy allocations for 1994-95
July 01, 1994
by Teresa Acklin
The U.S. Department of Agriculture in late June announced that 74 nations and regions would be eligible to purchase a total of 24.59 million tonnes of subsidized U.S. wheat under the 1994-95 U.S. Export Enhancement Program.
The 1994-95 total is 23% less than the 32 million tonnes initially allocated in the 1993-94 program. Officials said the 1994-95 package was reduced because a number of countries did not use a portion of their 1993-94 allocations.
In 1993-94, total EEP allocations were increased at mid-year to 33.3 million tonnes from the initial 32-million level. Even so, a total of only 17 million to 18 million tonnes was expected to be bought under the EEP by all countries.
Major 1994-95 allocations include 3 million tonnes for China, down from the 5.5 million allocated the previous year; 3 million for the former Soviet Union, down from 4 million; 3.5 million for Egypt, the same as in 1993-94; 2.3 million for Pakistan, up from 1.35 million; and 1.9 million for the Philippines, up slightly from 1.88 million.
Mexico, which had been targeted for 1.4 million tonnes of wheat in the 1993-94 EEP, received no new allocation, even though it had purchased about 636,000 tonnes under the EEP. Indications were U.S.D.A. excluded Mexico from new allocations because of the country's plans to levy counter-vailing duties on U.S. wheat imports.
Norway also received no new allocation, although it purchased 150,000 tonnes of its 160,000 allocation in 1993-94. A U.S.D.A. official said the country was not included because Norway's expected larger production would reduce its import needs.
The U.S. began the EEP in the mid-1980s to make its wheat more competitive on the world market and to counter European Union export subsidies. Under the EEP, buyers in eligible countries negotiate to buy U.S. wheat with exporters through regular commercial channels. The U.S.D.A. facilitates the sale by paying the difference between the sales price and the U.S. price, which typically is higher, to the exporter.
EEP subsidies also are paid for wheat flour export sales, but U.S.D.A. had not yet announced the allocations for that program.
The accompanying table shows 1994-95 allocations by country, comparisons with 1993-94 allocations and amounts purchased under the 1993-94 EEP. Figures are in thousand tonnes.
|Former Soviet Union||3,000||4,000||1,222|
|West/Central Africa||2,200||**||** |
|*purchases as of June 24, 1994|
|**For 1994-95, South Africa is included in Southern Africa. Southern Africa and West/Central Africa are new categories for 1994-95 that previously were grouped into the Sub-Saharan Africa category. In 1993-94, Sub-Saharan Africa had a total allocation of 2.7 million tonnes and purchased 2.108 million.|