TITLE

LESSONS OF THE GRAIN EMBARGO

AUTHOR(S)
Paarlberg, Robert L.
PUB. DATE
September 1980
SOURCE
Foreign Affairs;Fall1980, Vol. 59 Issue 1, p144
SOURCE TYPE
Periodical
DOC. TYPE
Article
ABSTRACT
The article points out lessons raised by U.S. President Carter's 1980 grain embargo against the Soviet Union. His announced purpose was to punish the Soviet Union for its military occupation of Afghanistan, begun in late December 1979. Meanwhile, owing to record demand, a poor harvest, and transport bottlenecks throughout much of the rest of the world's grain trading system, major suppliers other than the U.S. were less prepared than usual to assist in meeting Soviet import needs. As might have been expected, the president's embargo has failed to meet the strict requirement for success. To hold the support of farmers and grain exporters, a variety of compensatory measures were taken. Despite these market-tightening measures, 1980 farm prices did not keep up with fast-rising production costs, and farm support for the embargo eventually began to falter. Without acreage diversions, expanded 1980 plantings of spring wheat and corn then tended to offset the very bad summer weather, containing prices just enough to stimulate new demands for federal help, and fueling discontent with the embargo. In fact, U.S. grain producers tend to exaggerate the damage done to their export opportunities by the embargo. The volume, the value, and also the market share of U.S. exports of wheat and corn all grew in 1980, and the U.S. agricultural trade surplus continued to widen, despite the embargo. If the embargo continues, it could soon be further weakened by sales from several other Southern Hemisphere food exporters, including South Africa, Thailand and Brazil.
ACCESSION #
4854307

 

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