HTML _ 98-609 - If China Suspended U.S. Exports: Possible Impact on U.S. Wheat, Corn and Soybean Exports
14-Jul-1998; Charles Hanrahan; 9 p.

Abstract: On June 3, 1998, the President formally declared a one-year extension of most-favored-nation (MFN) treatment for China. The President's declaration makes MFN automatic unless Congress passes a joint resolution of disapproval by the end of August. An economic analysis prepared for CRS by the WEFA Group indicates that if MFN status were not renewed and China retaliated by ending imports of U.S. wheat, corn, and soybean products (only one of many possible scenarios), total U.S. exports of those commodities would decline, lowering U.S. farm prices and farm income. WEFA's analysis assumes that U.S. exports of wheat, corn, and soybeans and products to China would continue at the highest levels attained in recent years. This approach will maximize the potential effects of losing China as a market for U.S. farm products. The opposite extreme situation would be one of complete trade diversion which would result in no market effects. [read report]

Topics: Economics & Trade, Agriculture, International

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