Brussels, 16/07/2014 (Agence Europe) - The European Commission has announced that the import duty on maize, sorghum and rye has been set at €5.32 per tonne with effect from Wednesday 16 July. This decision stems from the basic regulation on the common market organisation and comes in response to the situation on the global maize markets (price drop). The Commission points out that there are no export refunds from maize, sorghum or rye.
The International Grains Council predicts high global maize production in 2014, at 963 million tonnes. Furthermore, the carryover of global maize stocks at the end of the growing year 2014-2015 is set to increase by 13 million tonnes to 180 million tonnes (the highest level in five years).
In view of this predicted bumper world harvest of maize in 2014 (particularly in the United States), the global market price for maize plummeted, standing at $203/tonne free on board (fob) US Gulf: for this origin, such a low price has not been seen since August 2010. On 1 July 2013, the quotation was $304/tonne.
Import duties. The EU has bound duties for all cereals set under the GATT agreement. However, for some cereals, the rate applied is different. The system originates in the Blair House Agreement between the United States and the EU and involves setting tariffs on the basis of individual world reference prices for specific cereal types. The mechanism is triggered automatically. The duty is calculated on the basis of the difference between the effective EU intervention price for cereals (€103.31/tonne) multiplied by 1.55, and the representative cif (cost, insurance and freight) import price for these cereals at the port of Rotterdam.
For many months, the resulting duty for maize has been set at €0/tonne (and 17 August 2010). For sorghum and rye, the duty has also been set at €0/tonne since 19 October 2010.
Since 1 July 2011 (2011-2012 marketing year), the representative cif import price for sorghum and rye has been equal to the representative cif import price for maize. Since that date, therefore, the import duty for sorghum and rye has been equal to the import duty for maize.
The individual tariff quotas are not affected by the measure. The duty-free quota of 277,988 tonnes of maize, split into two equal tranches open to all non-EU countries, is open each year on 1 January. By 4 July 2014, the quota had been taken up in full.
Maize and sorghum imports to Spain and Portugal have been subject to reduced import duty since these two countries joined the EU. An agreement between the EU and the USA allows a fixed quantity of third-country maize/sorghum to be imported, if necessary subject to reduced duty (“abatement”), to compensate the United States for the loss of its Iberian Peninsula markets. The current agreement covers two million tonnes of maize and 300,000 tonnes of sorghum to be imported into Spain each year. These amounts are reduced by any quantity of grain substitutes (e.g. starch residues, corn gluten feed and citrus pulp) imported into Spain in the same year. A tariff quota of 500,000 tonnes of maize to be imported into Portugal has also been agreed (duty fixed at a maximum €50 per tonne to guarantee the full use of the quota). The 2014, maize quotas for Spain and Portugal were taken up very quickly. As at 4 July 2014, 11% of the sorghum quote of the Spain had been taken up.
Measure for Ukraine. A vote was held on a Commission regulation opening up import tariff quotas for Ukrainian grains on 8 April 2014. This regulation will open up the Community market, until 31 October 2014, and with an import duty equal to zero, to 400,000 tonnes of Ukrainian maize. As at 4 July 2014, 8% of this quota had been taken up. (LC)