Australian allegations not based in fact says U.S. Feed Grains Council.

WASHINGTON--(BUSINESS WIRE)--Nov. 4, 1994--"The United States is not taking markets away from the Australians.

"We are using GATT-legal export programs to expand out marketing efforts," said Kenneth Hobbie, president and CEO of the U.S. Feed Grains Council. "We cannot let the Australians make misleading statements."

Hobbie was speaking in response to allegations by the Australian Grains Council that the recent announcement of Export Enhancement Program initiatives for U.S. barley interfere in "traditional Australian markets."

China and South Korea were included in the export enhancement package announcement that totaled 2.6 million metric tons and included 24 countries.

"China and Korea are new opportunities for U.S. barley," said Hobbie. "Since Korea banned all feed barley imports until late this summer, the market cannot be a traditional Australian market.

"China uses imported barley in beer production. China has the fastest growing beer and malting industry in the world and already is the world's largest importer of malting barley representing one-third to one half of the world trade. You can't tell me that the 75,000 metric ton EEP initiative for China is going to come directly in competition with Australian barley.

"There is enough demand growth there for the United States and Australia to compete in this market, especially when beer production is growing at 15 percent per year and consumer demand is growing 20 to 25 percent per year.

"We can understand the Australian concern about the severe drought and reduced crops this year. It was just last year that floods cut U.S. production. But when the United States had short supply the Australians had a large market share and still complained. Our understanding is that Australia will still export 1 million metric tons of barley. Seventy- five-thousand metric tons is a relatively small presence.

"Everyone needs to keep in mind that the choice of supplier is still up to the customer. The U.S. government can make EEP available, but the purchaser must go through commercial channels. These EEP announcements enable U.S. exporters to supply the market at commercial prices."

The council is a private, non-profit organization that develops and expands export markets for U.S. feed grains and co-products through a network of 11 international offices. The council has staff in Latin America, Europe, the Middle East, Africa and Asia.

Support for the council comes from barley, corn and sorghum producers in Colorado, Idaho, Illinois, Iowa, Kansas, Kentucky, Louisiana, Maryland, Michigan, Minnesota, Missouri, Montana, Nebraska, North Carolina, North Dakota, Ohio, Oregon, South Dakota, Texas, Virginia, Washington, and Wisconsin. The council also receives substantial support from leading agribusiness firms across the United States.

CONTACT: U.S. Feed Grains Council

Donna French Dunn, 202/789-0789