STAFF Chris Rauch, Vice Chair Lexington, OR By Earl Pryor
Certainly everyone is amazed by the continued value escalation of the remaining world wheat stocks. The current price level has not yet had an appreciable rationing impact on international demand, in part domestically, because of the declining value of our dollar. For the record, 10/08/07 SWW price was $9.38; 11/15/07 SWW was $9.38; a month later, $11.98; three days later $12.73 and counting. U.S. exports stand at 1,053 million bushels (mbu) currently, 90 percent of exportable supplies, leaving estimated domestic stocks at 279 mbu, 24 percent of our annual domestic usage.
What next??? Wheat producers world wide have an important stake in the WTO trade negotiations. This agreement will bring definitive, enforceable guidelines for International trade through an appellate process of claims and counterclaims, under the framework of the concluded Doha Agreement. There will be winners and losers with the developed nations in vulnerable positions as world opinion seeks to level the field of trade opportunity.
Currently, free trade promotion agreements (FTA) are proliferating worldwide as regions and independent nations seek to hammer out mutually beneficial trade agreements. A prominent fixture in all agreements is the fixing of tariff levels between parties. U.S. agriculture is pleased with Congressional passage of the US/Peru FTA and looks forward to the approval of Columbia, Panama, and South Korea FTA’s. These trade agreements represent duty-free access to a combined market of 124 million people.
Another issue is the role of wheat in Food Aid, worldwide! The U.S. is the leading donor of food aid in the world, donating 1.19 MMT in 2006 (US $210 million). Wheat is often monetized, or sold (11 %) by relief organizations, generating revenue for development projects. The management of those local projects in the most beneficial manner should be the focus to alleviate criticism.
AND finally………Hallelujah the 2007 Farm Bill is passed!!!!!!!! All wheat producers extend a heartfelt sigh of relief and appreciation to all state wheat associations and NAWG for their steadfast devotion to our industry goals and the successful adoption of this critical legislation!!! A JOB WELL DONE!!!! I Hope Everyone Had Safe and Happy Holidays!!!
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