Imported grain in world trade

Imported grain

of some grains can be a quarter of their imported value, compared

with only 1% to 3% for manufactured or processed goods. A tonne

of milling wheat cost 285 euros in the summer of 2007 when

prices reached record highs but transporting costs varied from $36

to $74 per tonne depending on the destination. The relatively high

shipping costs for agricultural products influences a country’s

comparative advantage in this sector. Exporters tend to have easy

access to major shipping routes or to sell higher-value produce

that justifies air transport costs.

We could add a third reason as well. The high level of tariffs

and government support provided to farmers in many countries –

particularly some highly developed OECD countries – protects

them from competition from suppliers around the world that may

be more competitive.

Within this general context, more and more countries are

participating in agriculture trade, but a relatively small number of

them capture most of it. The top 20 exporting countries accounted

for almost 80% of exports in 2004. The least developed countries,

the group receiving special consideration in the Doha Round,

account for less than 1% of the total. OECD countries continue

to dominate agriculture trade although their share of the total has

declined somewhat over the past couple of decades. Most of the

gains have been made by countries that are in the G-20 group of

the world’s biggest economies.