[fullwidth background_color=”” background_image=”” background_parallax=”none” enable_mobile=”no” parallax_speed=”0.3″ background_repeat=”no-repeat” background_position=”left top” video_url=”” video_aspect_ratio=”16:9″ video_webm=”” video_mp4=”” video_ogv=”” video_preview_image=”” overlay_color=”” overlay_opacity=”0.5″ video_mute=”yes” video_loop=”yes” fade=”no” border_size=”0px” border_color=”” border_style=”” padding_top=”20″ padding_bottom=”20″ padding_left=”0″ padding_right=”0″ hundred_percent=”no” equal_height_columns=”no” hide_on_mobile=”no” menu_anchor=”” class=”” id=””][title size=”1″ content_align=”left” style_type=”underline solid” sep_color=”#000000″ margin_top=”” margin_bottom=”” class=”” id=””]Excessive subsidizing by China, Brazil and other advanced developing countries is harming U.S. and world wheat farmers and could cost U.S. growers nearly $1 billion in revenue every year, according to a study commissioned by U.S. Wheat Associates[/title][fusion_text]Tuesday, September 15th, 2015
Excessive subsidizing by China, Brazil and other advanced developing countries is harming U.S. and world wheat farmers and could cost U.S. growers nearly $1 billion in revenue every year, according to a study commissioned by U.S. Wheat Associates (USW). The study, led by Iowa State University agricultural economist Dermot Hayes, shows that these countries, including India and Turkey, have dramatically increased their support for domestic wheat production over the last decade to levels far exceeding World Trade Organization agreements (WTO, with a detrimental effect on global wheat trade. The researchers determined that if all support were removed from all four countries, U.S. annual wheat production would increase by more than 53 million bushels (current production is just over 2 billion bushels), farm gate prices would increase by nearly 30 cents a bushel, and U.S. wheat farmers would receive $947 million more in annual revenue. The price support and input date was identified in a November 2014 study by DTB Associates. According to USW and the National Association of Wheat Growers (NAWG), the results show that if domestic support were removed, wheat prices in the countries examined would go down and farmers would plant less of the grain, but domestic consumption would go up. The study also suggested that with increased consumption, the four countries would boost net imports by nearly 10 million metric tons. Hayes said the model estimated the U.S. would capture more than 20 percent of such an increase to export an additional 2.2 million tons, compared to the model’s baseline if there were no changes in domestic support in those countries. The study also compares future scenarios to data from a market situation in which wheat cash prices were significantly higher than they are now. For example, in addition to Chinese government input subsidies coupled to wheat production, the 2014 DTB study in 2014 showed Chinese farmers have government minimum support prices of more than $10 per bushel.
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