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Abstract

The objective of this research is to analyze the factors affecting the price responsiveness of disaggregated classes of U.S. wheat exports. Factors examined in this study that are likely to influence U.S. exports on a class-by-class basis include wheat prices – own price and cross price effects from wheat classes and competitive substitutes such as feedgrains; supply-demand balances by wheat class for major export sellers & import buyers; ocean freight costs for U.S. grain exports; and exchange rates for the U.S. dollar & other currencies. Using public data from domestic and international sources, single equation models of U.S. wheat export demand were developed, with one group of U.S. wheat export competitor models by wheat class, and a second group of U.S. wheat export share models by class. Results indicate that both own price and cross price responsiveness of U.S. exports was found in hard red winter and hard red spring wheat class exports. Soft white wheat and soft red winter wheat exports were unresponsive to own or cross price effects, but instead responded to changes in world wheat and corn supply-demand balances. Ocean freight rates, U.S. currency exchange rates and quarterly period seasonal factors also at times influenced U.S. wheat exports in these results. Additional factors likely to influence class-by-class U.S. wheat exports that are not explicitly examined in this study include the proportion of food versus feed quality wheat by class as is most common in individual exporting and importing countries, and protein and quality factors for U.S. wheat by class. Future applied research efforts will need to account for these factors.

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