International Trade:

Canada and Australia Rely Heavily on Wheat Boards to Market Grain

NSIAD-92-129: Published: Jun 10, 1992. Publicly Released: Jun 26, 1992.

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Pursuant to a congressional request, GAO reviewed the Canadian and Australian grain export marketing systems, focusing on: (1) their wheat board operations; (2) the type and amount of government assistance to wheat producers during the last 5 years; (3) their export credit systems; and (4) their reactions to U.S. export enhancement measures.

GAO found that: (1) Canadian and Australian wheat boards have noncompetitive marketing systems which pool wheat to be exported, and vary prices to maximize the profit of wheat producers; (2) from 1980 to 1990, Canada assisted its agricultural producers by providing income support, crop insurance, and a freight rate subsidy; (3) Australia removed subsidies on export inspection, fertilizer, and interest payments, eliminated the minimum price to growers, and no longer sets the domestic price for wheat at artificially high levels; (4) Canada and Australia offer export credit guarantees for wheat; and (5) Canada and Australia have not changed their export policies in reaction to U.S. export enhancement efforts but have redirected their marketing efforts to riskier markets and countries not covered in U.S. efforts and have focused on grain quality as a marketing strategy.

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