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EC's Common Agricultural Policy Slows Farm Exports

Author

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  • Tontz, Robert L.

Abstract

How well has the United States done in the European Community (EC) farm commodity market since the Common Agricultural Policy (CAP) was inaugurated in 1962? The record reveals that U.S. commercial sales of farm commodities to the EC grew at less than two-thirds of their growth rate to other countries. EC variable import levies held the rise in exports to the EC of affected U.S. commodities to a modest 23 percent, compared with a 94-percent gain for commodities not subject to the levies. EC internal trade (or "intratrade" as used in this article to identify trade among EC members) in farm commodities increased nearly 2 1/2 times, compared with less than half for EC imports from third countries. Intratrade gains for French grain are of particular concern to the United States. Barring policy changes, EC enlargement with its wider application of restrictive policies poses a significant threat to our farm export growth.

Suggested Citation

  • Tontz, Robert L., 1972. "EC's Common Agricultural Policy Slows Farm Exports," Miscellaneous Publications 316779, United States Department of Agriculture, Economic Research Service.
    • Handle: RePEc:ags:uersmp:316779
    DOI: 10.22004/ag.econ.316779
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