The US Export Enhancement Program and the Australia wheat industry

Roberts, I.; Whish Wilson, P.

Agriculture and Resources Quarterly 5(2): 228-241

1993


Accession: 002512590

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Abstract
Recent expansion of the US Export Enhancement Program (EEP) has sparked renewed concern in the Australian wheat industry. The EEP is an export subsidy scheme applied selectively to US exports to certain markets. Those markets now account for most US wheat exports. Emphasis in this article is placed on two factors. The first is the impact of the EEP on US exports. The second is whether the EEP reduces prices for Australian exports in EEP targeted markets relative to prices on other markets. The EEP increases average prices to US producers above export prices and this leads to increases in US production and exports. Higher US exports depress world prices thereby adversely affecting returns for Australian wheat. The EEP also results in lower prices on targeted EEP markets than elsewhere.