ECONOMIC

88 percent. Since U.S. food prices had been significantly lower in the pastthan food prices in more protected markets, the resulting rise of food pricesin the United States was larger than in most other countries. When ceilingswere imposed on the prices of foodstuffs to contain the inflationary pressures,the export pressures increased even more.The problems created by rapid increases in foreign demand became particularlypronounced with soybeans and related products. When it appearedthat export contracts would exceed available supplies until new crops wereharvested, temporary controls were imposed on exports of these commoditiesin early July. The export licensing provisions allowed each exporter to ship afixed percentage of the exports he had contracted before June 14. Later thecontrols were extended to cover other high-protein feeds. All these controlswere terminated by October 1. Despite the controls, exports of these productswere substantially larger in 1973 than in 1972. The soybean crop harvested inlate 1972 had been a record crop, and almost the entire increase in productionwas added to exports in 1973. The United States increased soybean exportsby 18 percent and increased exports of soybean meal by 25 percent overthe previous harvesting season.Export pressures combined with controls on domestic prices also led todomestic supply shortages for a number of nonagricultural commodities,including steel scrap and logs. To alleviate shortages, the Governmentimposed temporary controls on the export of steel scrap in July. These controlswere supplemented by a Japanese decision to reduce imports of ferrousscrap by 1 million tons during the remainder of 1973. Japan also agreedvoluntarily to cut back her imports of U.S. logs.A large number of countries besides the United States imposed exportcontrols to protect domestic supplies of food and to ease inflationary pressures.Brazil, the world's other major exporter of soybeans, limited the exportof soybeans and soybean products shortly after the United States imposedcontrols. Canada instituted an export licensing program for protein feedsupplements, edible oils, animal fats, and livestock protein feed; export controlswere also imposed on live cattle and hogs and on fresh, chilled, andfrozen beef and pork. Australia tightened export controls on a similar list offeed products. Both the Canadian and Australian controls were lifted laterin the year. The Common Market countries suspended export subsidies forseveral dairy products in July and in August banned the export of wheat andwheat products. The export bans were later replaced by export levies onwheat, as well as corn and barley.Export controls of a more serious kind were imposed by some of the oilproducingcountries in the Middle East, after renewed fighting broke outbetween Israel and some Arab states. In order to pressure third countries tosupport their cause, most Arab states cut back oil production and exportsand imposed an embargo on shipments to the United States, the Netherlands,and several other countries. These controls on oil, as discussed earlier,severely threaten the economic prospects of all industrial nations. If sus-211