Impact of the US-EC price war on major wheat exporters' shares of the Chinese market

Abstract

China is both the world's largest producer and consumer of wheat. In an attempt to gain a larger slice of the important Chinese market, both the European Community and the United States have offered China subsidised wheat. In addition, other exporters have offered attractive credit arrangements to China. The objective of this paper is to measure the overall impact of these policies on each exporter's share of the Chinese market. To that end, an improved version of the constant market shares model is applied to data on Chinese wheat imports in the 1980's. The results indicate that the United States has been outperforming the other exporters since subsidised US wheat sales were authorised for ..