Situation and regulation of the grain verticalness
1992
Borszeki, E. (Kvantum Bank Rt. (Hungary))
In recent years the profitability of grain production decreased to the level of the cost of production, and even fell below this. The costs of production increased to the smallest extent in this branch, which was touched most sensitively by the gap between the prices of agricultural and industrial products. Since 1989-90, the commercialization of grain has been transformed entirely, the Grain Trust was liquidated, the prices were liberated, the right for foreign trade was spread and the money market started its activity. The grain industry continued to have its projecting role in the commercialization of the grain for both human and animal feeding purposes. At the present low profitability, the self-financing capacity of the grain branch is not secured. The production price level falls far short of the West-European level, and even of the level of the world market prices. The price level of the Western European countries remains unattainable within reasonable time. On the other hand, more balanced is justified for the moderation of the risk of producers and the making of the domestic supply. For this reason, the determination of the guiding price of orientation purpose is needed. Furthermore, the introduction of an intervention system for the bread grain can be proposed which will stay constant in its rules and size within the financial year
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