Book Description

World grain and oilseed production set new records in 1985-86, while grain exports fell to the lowest level since 1978-79. That produced rapidly rising world carryover stocks: sharply increased costs of government farm programs in the European Community, United States and other countries: acontinued drift toward trade protectionism and trade policy conflicts; and one of the most dramatic changes in U.S. farm policies in half a century. Much of the increase in world carryover stocks in 1986 is being stored under government programs in the U.S., and the U.S. shares of world exports of many major farm commodities continued their downward trend in 1985-86. To halt the decline, U.S. price support levels for 1986 crops have been reduced sharply, while impact on farmincome is being tempered through the target price system. The U.S. export enhancement programs also are expected to be expanded substantially in the next few years. Changing U.S. farm policies along with growth in the economics of oil importing nations should encourage modest growth in the volume of U.S. agricultural exports in the next few years. The growth rate, however, will be tempered by debt problems of developing nations and depressed economic conditions in oil exporting countries. Lower U.S. price support levels and large world supplies appear likely to be a depressing influence on world grain prices as well as the value of U.S. agricultural exports in the late 1980s. Appropriate agricultural policies might focus on causes of slow growth in world.