Quality Uncertainty in International Grain Markets: Analytical and Competitive Issues

One of the important issues dominating the competitive environment of the world grain market is quality consistency and uncertainty. Quality uncertainty in the grain marketing chain can be defined in a number of ways and can result in variability of end-use processing characteristics. Quality uncertainty is important because variability can increase costs for buyers, processors, and grain handlers. Quality uncertainty affects competition within countries and across international borders. Various strategies have been pursued by major exporters. Processors concerned with obtaining a high-quality product may pursue vertical integration, purchase, loading, and contracting strategies to reduce quality uncertainty. Future research for grain quality could include examination of factors contributing to quality uncertainty and private and public strategies and policies to reduce or manage quality variability.