|
|
|
|
|
|
Q & A: The Dairy Export Incentive Program
The major objective of the Dairy
Export Incentive Program (DEIP) is to develop export markets
for dairy products where U.S. products are not competitive
because of the presence of subsidized foreign products. DEIP
levels the playing field and helps U.S. exporters meet prevailing
world prices for targeted dairy products and destinations.
USDA pays cash to exporters as bonuses, allowing them to sell certain dairy products at prices lower than the exporters' costs of acquiring them.
Who benefits from the program?
The DEIP helps U.S. agricultural producers, processors and exporters gain access to foreign markets.
What commodities are eligible?
Commodities eligible for DEIP bonuses are: milk powder; butterfat; and Cheddar, Mozzarella, Gouda, Feta, cream, and processed American cheeses.
Who can participate?
An exporter interested in participating in the DEIP must provide specific information, including:
In addition, exporters must post a performance security before submitting a request for a bonus.
How sales are made:
All sales under DEIP are made by the private sector, not the U.S. government. Once an invitation for bids is issued, it's up to agricultural exporters to contact prospective buyers in eligible countries and negotiate a sales contract covering price, quantity, quality, delivery and other terms.
The sale may be contingent on USDA's approval of a bonus. Each prospective exporter submits a bid to USDA requesting a subsidy--or bonus--that would allow the sale to take place at the agreed price.
USDA reviews all bids for the competitiveness of the bonus value requested and compares bids with offers from other U.S. exporters and sales of competitor countries. USDA has the right to reject any or all bids.
Once USDA accepts a bid, the exporter and the Commodity Credit Corporation (CCC) enter into an agreement.
Receiving the bonus:
The bonus is paid to the U.S. exporter in cash. The CCC determines the bonus payment by multiplying the bonus specified in the agreement by the net quantity of the commodity exported. In most cases, once an exporter furnishes USDA with evidence that the specified commodity has been exported to the target destination under the terms of the agreement, the exporter can request payment of the bonus.
For further information:
Basic program information is contained in the DEIP regulations, Code of Federal Regulations 7 Part 1494, Subpart B, available in most public libraries. News releases announcing the targeting of new initiatives and acceptance of bids are available on the Internet at the FAS Web site at http://www.fas.usda.gov.
A weekly summary of DEIP activity is available on the FAS Web site. Invitations to exporters eligible to bid are distributed by USDA to qualified exporters by facsimile.
For a copy of the DEIP regulations or to learn more about the program, contact USDA CCC Operations Division, Stop 1035, 14th & Independence Ave. S.W., Washington, D.C. 20250-1035. Tel.: (202) 720-2150 or (202) 720-5540; fax (202) 720-0938; E-mail: oden@fas.usda.gov
USDA announces bid acceptances under the DEIP by 10 a.m. eastern U.S. time and makes the information available through a fax polling system and via the Internet. To receive the information by fax, callers should set their fax machines for polling and dial (202) 720-1728. The address for the FAS home page is http://www.fas.usda.gov.
|
|