Changes in EEC Imports of Commodities Affected by the Variable Levy System

Excerpts from the report: Within the framework of the Common Agricultural Policy (CAP), the European Economic Community (EEC) instituted its variable levy system on July 30, 1962. The commodities covered were grains, eggs, poultry, and pork. In the fall of 1964, the variable levy system was extended to cover rice, beef and veal, and dairy products. In general, the system stimulates internal production by establishing a high level of support prices and nullifies any price advantage non-EEC exporters might have through a reliance on minimum import prices. This has created anxiety in the United States and in other countries supplying agricultural commodities to the EEC. This report is basically a time series analysis of market shares. The time series utilized throughout were derived from data obtained from the United Nations publication, Commodity Trade Statistics. Thus an analysis is made of changes in the U.S. position based upon data reported by the Common Market countries. Market shares for the United States, other non-EEC nations, and intra-EEC trade were computed using quantity data when commodities were fairly homogeneous within a group and value data when they were not. For these three geographic areas, share statistics for each commodity or commodity group were then rearranged into time series for analysis.