Wheat Association Makes Case for Export Promotion Funding

Global trade requires active participation from U.S. agriculture due to equal interest from competing countries, study finds.

Published on: Jun 11, 2013

Many countries are investing significant amounts of money into promoting international food and agricultural trade, a new study completed on behalf of several U.S. agri-food export market development organizations says.

The study was prepared by Agralytica Consulting, Alexandria, Va. It is the first to take an in-depth look at competing export market development programs as well as the source and amount of funding, says Shannon Schlecht, vice president of policy at U.S. Wheat Associates.

"Exports are vital to U.S. agricultural producers with 95% of consumers living outside our borders. The analysis was designed to give organizations like ours strategic, competitive information we can use to help make our export promotion plans more effective for the farmers, ranchers and small businesses we represent," Schlecht said.

Global trade requires active participation from U.S. agriculture due to equal interest from competing countries, study finds.
Global trade requires active participation from U.S. agriculture due to equal interest from competing countries, study finds.

Overall, the study provided new information about competing export development activities, program structure, funding and evaluation methods.

Key findings include:

- Together in 2011 the 12 countries and the EU central government spent an estimated $1.8 billion, including $700 million in public funds and $1.1 billion in private funds, on export promotion for agri-food products.  For comparison, in 2011 the United States spent an estimated $650 million, including $256 million in public funds and $394 million in private investment, on agri-food export promotion.

- The EU allocated an estimated total of $360 million of public funds in 2011 to member states for export promotion. Additional public investment by governments in France, Italy, Spain and The Netherlands brought that total to $460 million.

- Public support to small and medium sized enterprises is a key objective of competitor programs.

- Focus on market access is growing. In general, monitoring trade policies and securing market access are seen as essential components of market development.

The study also makes comparisons between competing programs and U.S. market development programs administered by FAS, including MAP and the Foreign Market Development program.

U.S. programs "provide an effective solution to many issues faced by competitors," the summary report says. The study did not examine such other programs as export finance, tax policy or farm support programs.

Read the full summary report at http://bit.ly/14OPKtD.

Source: US Wheat Associates