Costs and Benefits of Cleaning U.S. Wheat: Overview and Implications

William Lin and Mack Leath

No 308280, Agricultural Economic Reports from United States Department of Agriculture, Economic Research Service

Abstract: Cleaning all U.S. wheat for export above the current level is not economically feasible because costs of additional cleaning at the lowest net-cost location--country elevators for spring wheat and subterminal elevators for winter wheat--would outweigh benefits by at least $8 million in the short run. Since it is not in the U.S. wheat industry's interest to clean all export wheat, an alternative would be to target clean wheat for special niche markets. The wheat industry could potentially gain $8 to $10 million in net benefits if it targets wheat cleaning to the cleanliness-conscious markets, which account for about 20 percent of all U.S. wheat exports. Any public policy designed to promote cleanliness of U.S. wheat exports and to improve U.S. competitiveness in the world market must address the issue of how much, where, and which classes of wheat to clean and target for cleanliness-conscious markets. Policy options worthy of consideration include establishing dockage as a grade-determining factor, segregating wheat by its intrinsic characteristics, and launching an information (outreach) program to meet buyer preferences and to familiarize foreign buyers with U.S. wheat quality.

Keywords: Crop Production/Industries; International Relations/Trade; Marketing; Production Economics (search for similar items in EconPapers)
Pages: 33
Date: 1993-12
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:uerser:308280

DOI: 10.22004/ag.econ.308280

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