World cereals productionWorld cereals production in 2002 was estimated to be lower than in three preceding years and made cuts in carry-over stocks. World wheat prices surged up and alleviated EU wheat exports. On the other hand, high U.S. wheat prices also caused EU import tariffs to vanish. Reduced protection attracted massive deliveries of East European wheat that impaired the prospects of farmers to sell wheat in Southern EU countries. Steeply increased wheat imports finally led the Commission to propose a radical change of the EU wheat import regime. Thus, the system of variable import tariffs based upon a couple of representative U.S. wheat prices plus transaction costs was - with regard to medium and lower grades - replaced by specific soft wheat tariff rate quotas totalling 3 mt. The in-quota tariff of 12 Euro/t contrasts to an off-quota rate of 95 Euro/t. While major quota shares are reserved for traditional exporters, non WTO members as Russia and Ukraine complain about discrimination. At the domestic cereals market burdensome stocks of unsaleable rye released reflections about an eventual suspension of rye intervention and non-food uses for this grain.
