Foreign Trade Prices

the range of prices on the goods and services exchanged in international trade of the socialist countries. Foreign trade prices reflect the world prices that are in effect at a given time as well as the prices that are established by agreement with any particular group of countries. Thus, trade between the socialist and capitalist countries is based on world prices, while trade between countries that are members of the Council for Mutual Economic Assistance is based on appropriately adjusted world prices. The variations in foreign trade prices depend on the peculiarities of a given market and the terms of commercial transactions. The various countries’ statistical records of foreign trade prices are an index to the total value of any given category of goods exported or imported over a given period. The sale price and the product mix directly influence the average statistical level of foreign trade prices.

The range of foreign trade prices covers the export list prices of firms that are the principal suppliers of a given type of product, stock market and auction prices on raw materials (such as nonferrous metals, rubber, and furs), prices offered by sellers, prices bid by prospective buyers, and contract prices. Prices in the latter category—contract prices—are the most accurate ones, inasmuch as a wide-ranging system of discounts from list prices and bids is practiced in international trade; this system takes into account the size of the sale lots, regularity of deliveries, terms of payment, and specific commercial contract terms.

Variations in foreign trade prices also depend on shipping costs: CIF prices include the basic cost of an item plus insurance and freight costs; f .o.b. prices represent costs up to loading only.