Agricultural potential in Latin America and Caribbean for biofuels for transport

93 p.The present study presents a general assessment of the productive capacity of Latin American countries for producing biomass1. Biomass can be transformed in secondary liquid energy carriers like biodiesel and bioethanol, fossil fuels substitutes. The document begins with the description of the characteristics of currently used energy crops2 world wide. A specific analysis of Latin American productive conditions was then carried out to determine if the region has the potential to reach, at least, 5% blend levels3. The land availability and energy crop yields for biomass production were also projected for the year 2025, together with two alternative raw materials i.e. waste crops and field residues. Finally, the effects of a demand increase; producer subsidy and price support on energy crop markets were assessed. It was determined that most of Latin American countries could produce sufficient biomass to reach 5% blends. There is land availability for biomass production in 2025 mostly in South American countries. Potentially attainable blends of most Latin American countries for the year 2025, using biomass from agricultural energy crops, are between 30% and 91% for biodiesel, and between 20% and 206% for bioethanol. Blend estimates from forestry biomass are even higher and from residues are much lower. The “price support” measure causes the highest net welfare gain in Latin America countries (1.844 Mill. US$) as well as in the Rest of the World (1.623 Mill. US$) , whereas the demand shift provokes in the Rest of the World a net welfare loss of 761 Mill. US$

EU agricultural tariff rate quotas:do they improve market access for Argentine Agricultural Products? A case study of maize and beef TRQs.

80 p.The Uruguay Round Agreement on Agriculture (URAA) was set to be a step forward a fair agricultural market system as all border measures were converted into tariffs. In the face of resulted high bound tariffs, a compromise was reached by the introduction of tariff-rate quotas (TRQs) for guaranteeing minimum and current access to markets. TRQs are not only the combination of two tariffs and a quota but include an administration method that aims at rationing quota rights. Concerns about market access appear obvious since TRQs have resulted in few import opportunities. Allocation methods bring about extra costs as also do other enforced measures applied at the border. Both could be considered non-tariff costs and have the potentiality to bias trade. The EU is one of Argentina’s major destinations of agricultural products and EU TRQs are a means of market access to EU high protected markets. The analysis assesses the implications that non-tariff costs have for Argentine agricultural sector when utilising EU TRQs. Using beef and maize EU TRQs as case studies, this work evaluates how EU TRQs have improved Argentina’s market access to its agricultural market. It is concluded that EU TRQs usage does involve non-tariff costs for agri-food actors exporting from Argentina. These non-tariff costs have not, so far, hindered trade although they reduced the rent accrued by TRQ utilization when this exists. Being acquainted with the negotiating capital involved it is suggested that Argentina should have the reduction of MFN tariffs as principal objective in future multilateral negotiations. Key words: Market access, Argentina, European Union, Tariff Rate Quotas, Administration methods, non-tariff costs

Empirical risk analysis in a model that combines future contracts and warehousing receipts as an income stabilisation measure. A case study for Hungarian wheat farmers under the current common agricultural policy using Monte Carlo simulation approach

159 p.The last reforms of the CAP in compliance with the agreements on agriculture in the Uruguay round and also to prepare the EU for the current Doha-Round, have called for adopting market instruments to manage the risk caused by the volatility of agricultural commodity prices, what the blue box´s measures may not compensate. In the light of this fact, Hungary has gained a great deal of experience in the usage of these instruments for its agricultural commodity markets, specifically for wheat and corn. Both future contracts and warehouse receipts (also called warehouse warrants) have been combined to develop a new mechanism to reduce the potential damages caused by price fluctuation and market volatility in general. This study is based on research conducted by László Kozár and Zoltán Bács, but also includes an extension. This extension is a method to calculate risk using Monte Carlo simulation as well as some adjustment of the inputs of the original model according to the new legislation of the agricultural markets in Hungary under the regime of the Common Agricultural Policy (CAP). The empirical analysis is applied for the Hungarian wheat market. Several scenarios demonstrate the improved performance of the extended model relative to the previous model by providing more information for business decisions. Key word