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Abstract

Domestic and foreign import and export policies which restrict trade, along with increasing variability in exchange rates, are causing increased fluctuations in U.S. grain exports and are making U.S. farmers increasingly uncertain about the prices they can expect and about what they should produce. Farmer uncertainty reduces production, raises prices for consumers, and may accelerate structural changes in the farm sector. These problems may worsen over the next 20 years if other countries further insulate their domestic markets from variations in the world market. As export markets grow in coming decades, U.S. grain policies can be tailored to mitigate such impacts; but the alternatives may also involve undesirable side effects.

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