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The Role of Quality in Wheat Import Decisionmaking

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  • Mercier, Stephanie A.

Abstract

The dramatic losses in U.S. wheat market share over the last 10-15 years (a 40- percent decline since 1973) have raised the question of whether additional wheat cleaning would help the competitiveness of U.S. grain. When making decisions about wheat import sources, importers consider factors such as price, wheat quality, trade-servicing reliability, and political relationships. This study focuses on the function of quality in the import decisionmaking process, particularly the cleanliness of wheat. This study finds that wheat quality matters most in markets that do not receive export subsidies or other forms of export assistance, and countries that conduct imports under a state trading system are less likely to be sensitive to quality and more sensitive to price. Offering cleaner wheat to all U.S. wheat export customers would have a net cost of at least $8 million. Delivering a higher quality wheat to select import customers could help maintain market share and even slightly expand share in certain quality-sensitive markets, leading to a net benefit to the U.S. wheat sector of $7-$9 million each year.

Suggested Citation

  • Mercier, Stephanie A., 1993. "The Role of Quality in Wheat Import Decisionmaking," Agricultural Economic Reports 308270, United States Department of Agriculture, Economic Research Service.
    • Handle: RePEc:ags:uerser:308270
    DOI: 10.22004/ag.econ.308270
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    References listed on IDEAS

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    Cited by:

    1. Gallardo, Rosa Karina & Lusk, Jayson L. & Holcomb, Rodney B., 2008. "Effect of Publicly Released Quality Information for US Hard Red Winter Wheat on Mexican Millers' Welfare," 2008 Annual Meeting, February 2-6, 2008, Dallas, Texas 6869, Southern Agricultural Economics Association.
    2. Diersen, Matthew A. & Wilson, William W. & Johnson, D. Demcey, 1995. "Quality Uncertainty and Grain Merchandising Risk: Vomitoxin in Spring Wheat," Agricultural Economics Reports 23365, North Dakota State University, Department of Agribusiness and Applied Economics.
    3. Adam, Brian D. & Kenkel, Philip L. & Anderson, Kim B., 1994. "The Economics Of Cleaning Winter Wheat For Export: An Evaluation Of Proposed Federal "Clean Grain" Standards," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 19(2), pages 1-19, December.
    4. Lavoie, Nathalie, 2003. "The Impact Of Reforming Wheat Importing State-Trading Enterprises On The Quality Of Wheat Imported," 2003 Annual meeting, July 27-30, Montreal, Canada 21901, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    5. Uri, Noel D. & Hyberg, Bengt, 1996. "Differentiation And Implicit Prices Of U.S. Wheat Exports," Journal of Food Distribution Research, Food Distribution Research Society, vol. 27(2), pages 1-14, July.
    6. Hyberg, Bengt T. & Ash, Mark & Lin, William & Lin, Chin-zen & Aldrich, Lorna & Pace, David, 1993. "Economic Implications of Cleaning Wheat in the United States," Agricultural Economic Reports 308269, United States Department of Agriculture, Economic Research Service.
    7. Lavoie, Nathalie, 2001. "Price Discrimination In The Context Of Vertical Differentiation: A Modeling Approach For Wheat Exports," 2001 Annual meeting, August 5-8, Chicago, IL 20603, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    8. Wilson, William W., 1995. "Decentralization of Grain Trading: Trends, Implications, and Challenges," 1995 Conference (39th), February 14-16, 1995, Perth, Australia 148784, Australian Agricultural and Resource Economics Society.
    9. Lavoie, Nathalie, 2003. "The Impact Of Reforming Wheat Importing State-Trading Enterprises On The Quality Of Wheat Imported," Working Paper Series 14512, University of Massachusetts, Amherst, Department of Resource Economics.

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