Agricultural Cooperatives Essay
It is the contention of this paper that although one might be encouraged to locate a nexus of interrelationships between agricultural cooperatives in America and current, significant issues in grain exports. It is more likely however, that the crucial relationships involve a "meta-organization" of individual farms of various sizes, agricultural co-ops, various corporations related to agriculture, and United States government departments and organizations; all of which act and react to international grain export challenges.
The effects of normal supply and demand fluctuations, new markets opening, and a myriad of other political-economic factors will, of course, have differing …show more content…
Trade restrictions imposed by the U.S. Government, however well-justified, do impact U.S. commodity exporters and consequently the entire agricultural sector. Furthermore, the effects of these restrictions are not limited to just the markets that U.S. exporters are prohibited from trading with: other exporters change their marketing strategies to the detriment of the U.S. (F.A.S. 2000)
The restrictions in trade are controlled by the Office of Foreign Asset Control (OFAC). The main countries targeted for restrictions are:
According to the FAS, the OFAC restrictions on these countries is fairly substantial. Taken as a total, the countries will import approximately 11% of the world wheat trade. This is not a trifling amount in terms of world market demand. It is enough to cause fairly serious economic concerns to American coops and grain exports.
In general, there is a large international market awaiting American grain exports. It has not changed in size, at least appreciably, in the past decade. The following graph of wheat data for the 1990's indicates a peak reached around 1993, and a small drop since then. In general though, the curve is shape is flat showing a steady market available for U.S. exports.