§ Mr. Ralph Howellasked the Minister of Agriculture, Fisheries and Food if he will compare the forms and value of agricultural support for wheat producers in (a) Great Britain, (b) the European Economic Community and (c) the United States of America.
§ Mr. Buchanan-SmithUnder the Community system, which is operated in Great Britain, wheat producers obtain their returns entirely from the market. Market prices are supported by levies which bring the price of imports up to a minimum threshold level; by intervention buying operated throughout the year for feedgrain and, usually, at a rather higher price level—the reference price—for wheat of breadmaking quality during part of the season; and by export refunds, to enable surplus grain to be exported on to the world market.
In the United States the market price is identical with the world price since there are no import levies or export subsidies. However, Government loans are available to producers which they may redeem either from sale proceeds or by delivering the grain to a Government agency: the rate at which these loans are made tends to set a floor to the market since the producers eligible for loans have no incentive to sell their grain for less than the loan plus interest. In addition, producers receive deficiency payments to bridge any gap between the average market price over the first five months of the season, or the loan rate if higher, and a target price. Loans and deficiency payments are normally made only to producers who undertake to restrict the area sown to wheat to a given level. In 1982–83 further inducements, in the form of cash and free grain from Government stocks, are available to producers who make additional reductions in the sown area.