E. U. Import Restrictions?

[TOM4CWB]

Charlie;

Had you heard about this?

"EUROPE PROPOSING TO LIMIT THE AMOUNT OF SOFT AND DURUM WHEAT THEY IMPORT


9/19/2002


The European Commission is proposing a tariff quota of 2.3 MMT on wheat to reduce imports of wheat into the EU. Duties would be set at €42/MT ($40.88/MT) for soft wheat and €17/MT ($16.54/MT) for durum. The quota and duty levels were taken by averaging values from the 1998-2000 campaigns. In addition, a duty-free quota of 300.0 TMT of soft wheat and durum from the US and Canada along with 50.0 TMT of durum from Canada would be maintained. Duties outside the quota would be set at €95/MT ($92.46) on soft wheat and €148/MT ($144.05) on durum imports. The US Trade Representative in a letter to the EU Farm Commissioner said that the 1998-2000 base was in violation of WTO rules as they require quotas to be set on the most recent imports by averaging the past three marketing years or the latest marketing year, which would include 2001 when trade was high and duties were close to zero. European grain traders and users said that the quotas would kill buying and trading opportunities."

WHAT IS THIS ABOUT???

What happened to "free trade"???

It looks like we are going backwards BIG TIME... like the 1930's?

[charliep]

Whoever said the world is fair?

[TOM4CWB]

Charlie;

Then what is a reasonable amount for Canadians to pay for food they eat...


Why isn't the GST on food being returned to the farm communities...

Just how much does the FED earn on GST paid on purchased food?

Why don't we use this funding to finance a viable rural sector...

Instead we push everyone out of rural areas, overload Urban communities... then we need billions for City infrastructure rebuilding...

I know things are not fair Charlie, but what exactly are we setting our children up for???

[ianben]

Not heard this one myself. Probablly will be to restrict FSU wheat as present tariff formulae is not working due to higher N American prices.

You guys dont seem pleased to accept this wheat either going by some of the posts here.

Is a import restriction better than an outright ban due to percieved health risks?

I would agree Canadians must be getting the cheapest food in the first world if they do dont pay tax on it as well in the form of subsiby.
As I have stated before food subsidies do make the better off in our comunities pay more for their daily bread than those below the tax threshholds.

[TOM4CWB]

Ianben;

I see another article today:

"WHY IS EU TRADE POLICY GOING BACKWARDS?


9/20/2002


In the beginning, the EU proposal to impose trade barriers against wheat was baffling. After all, in recent months the domestic supplies weren't in the best of shape, millers needed imports, and even the feed sector had to access more wheat after mad cow disease forced the Europeans to add grain instead of animal by-products to its feed. But now that even the (non-French) Europeans are criticizing the proposal, the continuing campaign to close borders has become downright mystifying. Why does the EU want to install tariff rate quotas (TRQs) that will effectively work against the free trade they continually proclaim is their goal?

It's no surprise where the U.S. stands on the EU proposal. The U.S. has been protesting since July, when Agriculture Secretary Ann Veneman and U.S. Trade Representative Robert Zoellick pointed out that the proposal would restrict access to the European markets and would be "detrimental" to trade liberalization.

The Russians joined the protestations this week, going even further than the U.S. (so far). "I think we should implement customs and tariff measures on meat... imports," Russian Agriculture Minister Alexei Gordeyev told reporters. "We are... always promising further liberalization, while they defend themselves against products from abroad by all possible means."

Many Europeans themselves are becoming increasingly vocal against the EU government's proposal to restrict trade. "We are very much against TRQs, they kill the buying opportunities for industrial users and kill the trading opportunities," said Gert Jan van Noortwijk of the Royal Dutch Grain and Feed Trade Association. "Millers, starchers, compounders and the trade are fully against TRQs, they are fully unworkable."

Peter Jones, the wheat buyer for the UK's Rank Hovis, recognizes the concerns that are motivating the change. "We can appreciate that the farming community has problems with the influx of Black Sea wheat, but threatening the future exports of high quality wheat is not the solution," he points out. "There appear to be few in Europe supporting this, apart from Brussels [where the EU Commission has its offices] and the farming community."

So if the sellers, the buyers, the millers, and the users all want to keep the wheat trade open, to whom is the EU catering with their proposal? Ah, yes! It seems the French farmers are dictating the continent's agricultural policy once again...

"The European wheat user needs the ability to make independent purchasing decisions in full consideration of domestic and international market prices and comparative quality attributes," said USW vice president Vince Peterson. "USW is unswerving in our desire to see the marketplace function according to legitimate supply and demand signals."

"We join with our customers and our competitors in seeking fair and open trade with the countries of the European Union," Peterson declared.

U.S. wheat sales to the EU during the last marketing year climbed to over 2.2 million metric tons -- the highest level since the mid-1980's."

This certainly is a trying year for nearly everyone... to say the least...

Do your marketers in England have any prepricing programs for 2003 production wheat?

[ianben]

I found a report on it in this weeks farmers weekly.
Aimed at FSU countries as I thought. Apparently we already have a tariff system based on the difference between155%of EU intervention price and Chicago wheat futures plus freight.
Current high prices in US are allowing Black sea wheat to flood into EU but N America does not allow any on health grounds?

I repeat are import resrictions better than a total ban due to percieved domestic health risks.
I believe Black Sea wheat could be delivered to Alberta feedlots cheaper than Canadian today if your import rules where relaxed.
As long as I have farmed our wheat price has always followed Chicago approx but for the last two years Black sea sets our price.

Unless someone is willing to buy it price goes lower and lower.

So who is winning this trade war.

Steel and Lumber just who makes the rules as Charlie said who said it would be fair?

I can price 03 crop in many ways. Futures Nov 03 feed wheat is £61 canola £145 I have been offered a fixed price contract for 03malting barley at £70 I can fix a malting or milling premium over feed which is my usual strategy or I could sell into a pool operated by all the merchants these days.

I would also like your views on food subsides as social justice ie the poor pay less than the rich rather than a handout to farmers.
The cost of food to the better off in our comunities as a percentage of thier income has become obscene in my view.
I think if you want government money this is a far better argument than we are going broke.

[TOM4CWB]

Ianben,

Black sea grain is being currently imported East coast/center of both US and Canada. Obviously this supply is already arbitaged feed values in North America... are your marketers trying to bluff you, or is it because they bought large inventories and are not reflecting recent market increases in the cost of Black Sea grain?

It is expensive to import into the center of the continent, therefore hasn't made it to replace corn in diets...

Lots of feed wheat has been created in the last month, and feed/forage stocks are working into manageble levels, as grain is sacrificed for forage.

Do your merchants have "Act of God" weather disaster clauses in 03 contracts?

Can you manage the market risk if you don't have production in 03?