- The Washington Times - Friday, April 25, 2003

American agriculture companies are eyeing export opportunities in Iraq, historically a major market for U.S. growers.
"Before [the Gulf war], they were our largest export market," said Richard Bell, chief executive officer of Riceland Foods, a Stuttgart, Ark.-based grain cooperative that sold rice to the Persian Gulf country.
But in 1990 Saddam Hussein's Iraq invaded neighboring Kuwait, and in 1991 a U.S.-led coalition pushed Iraq out. The military conflicts and ensuing U.N. sanctions wiped out Iraq as a major destination for U.S. commodities.
Iraq was a $726 million market for U.S. agricultural products in 1989, with wheat and rice the leading commodities, according to U.S. Census Bureau numbers. Iraq was the biggest market for U.S. rice and the seventh-largest market for wheat.
But U.S. agricultural exports to Iraq were cut by more than half in 1990 and have not since approached pre-Gulf war numbers dipping as low as zero during several years.
Riceland's sales to Iraq, for example, stopped completely after 1998, with political tensions high, the Iraqi government opposed to buying U.S. products and the United Nations-run oil-for-food program handling the country's legal food imports.
The oil-for-food program was implemented in 1996 and allowed Iraq to use proceeds from oil sales to buy food, medicine and equipment to keep the oil industry running.
The Iraqi government chose companies and governments it would do business with, and the United Nations approved products and transactions.
"We participated in that, but I have to admit it was a hassle," Mr. Bell said.
With U.S. growers out of the way, competitors from other countries stepped in to fill the void, selling through the oil-for-food program.
Mr. Bell said Thailand and Vietnam became the major rice exporters to Iraq, and U.S. wheat industry sources said Australia became the major supplier of that grain.
But with new authorities running Iraq and the potential lifting of U.S. sanctions, growers and exporters are hopeful that they will resume exports and reclaim Iraq as one of the United States' top 10 markets.
"It was a huge market we'd like to get back into," said Barbara Spangler, executive director of the Wheat Export Trade Education Committee, a Washington-based trade group. "Before the 1991 war, we were one of their biggest suppliers."
U.N. economic sanctions are still blocking most trade, though President Bush this week said the sanctions should be lifted, and the oil-for-food program is still in place.
About 60 percent of the country's population relied on the program for their entire food ration, the United Nations said.
And beyond the future of the sanctions and the oil program, a new Iraqi government and a market economy have yet to take shape.
"We need a buyer," said Dawn Forsythe, spokeswoman for U.S. Wheat Associates, a marketing association for wheat exporters.
The government-controlled Iraqi Grain Board made purchase decisions under Saddam's regime. A new board could take shape, or a private market system could take over.
Another hurdle is competition. Countries that took over what had been U.S. market share are not going to step aside willingly.
Australian farmers sold $484 million in wheat to Iraq last year, and the country's monopoly wheat commission, the Australian Wheat Board, is fighting to keep U.N. contracts and market share.
Australia was part of the U.S.-led coalition and sent troops to the Gulf as part of the effort to oust Saddam.



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