BILATERAL TRADE OF DURUM WHEAT AND BARLEY UNDER CUSTA AND IMPLICATIONS FOR FARM PRICE AND INCOME

The objective of this study is to evaluate the impacts of Canadian exports of durum wheat and barley to the United States on the U.S. domestic prices of these two commodities and farm income in durum wheat and barley growing regions in the United States. Major factors affecting trade flows of agricultural commodities between the United States and Canada are the U.S. export enhancement program, the elimination of Canadian rail subsidies, marketing power of the Canadian Wheat Board, differences in macroeconomic conditions, and differences in resource endowments. They have influenced Canadian exports positively and resulted in major increases in Canadian exports of agricultural commodities to the United States. The increased Canadian exports reduce domestic prices of durum wheat and barley and consequently lowered farm income in durum wheat and barley growing regions in the United States.