AIS-Lancastw Farming, Saturday, May 4,1985
Farm Bureau program would expand commodity exports
PARK RIDGE, 11. - The
American Farm Bureau
Federation’s plan to use govern
ment-owned commodity stocks to
expand agricultural export op
portunities will save taxpayers
money.
Known as the '‘Bonus Incentive
Commodity Export Program”
(BICEP), the plan will use
government-owned commodities
now in storage as incentives to
expand U.S. export markets
abroad, according to Bruce
Blanton, AFBF economist.
“The export enhancement
program will be targeted at
specific customers so new sales
will be created and the bonus
commodities will not interfere with
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traditional markets. In addition to
attracting larger purchases, the
program will also be used to fight
those competitors who subsidize
their exports,” the economist said.
Any government-owned com
modities that are not needed for
other government programs will
be eligible for the export enhan
cement program as proposed in
HR1965 and S9OB, current farm
program legislation developed by
the Farm Bureau.
Blanton said BICEP is “cost
effective” because using a certain
amount of the commodities avoids
future storage cost payments.
Estimating future storage costs,
the economist for the nation’s
largest farm organization said a
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bonus commodity ratio of five to
one could be used for wheat and
cotton while the ratio could be four
to one for corn and rice.
“If a customer buys an ad
ditional five bushels of wheat from
the U.S., a sixth bushel is free,”
Blanton explained. “If a new
customer makes a similar pur
chase from the U.S. rather than
from a subsidizing competitor, the
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bonus applies.”
Legislation being considered
requires the Secretary of
Agriculture to use one-third of
available excess commodities as
export incentives. Blanton
estimated that in 1986, the first
year of the program under
proposed laws, at least 21.2 million
bushels of wheat, 14.5 million
bushels of com, 1.2 million hun
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dredweight of rice and 55,000 bales
of cotton would be used in the
program.
“Over a two-year period, the
bonus incentive commodity export
program will pay for itself through
reduced storage costs. Also, U.S.
farmers will regain export share,
moving more commodities and
providing more potential for
profit,” the economist said.
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