US officials cheered the agreement as did growers, who are facing huge inventories and the lowest prices in 11 years.

"It is a success story for both countries," US agriculture secretary Dan Glickman said in a statement.

"This agreement renews access for US farmers to a major wheat market."

Before the ban went into effect, US growers used to sell upwards of $50 million annually to Brazil -- one of the world's largest wheat importers.

Bill Flory, head of the National Association of Wheat Growers, estimated the US could ship as much as 400,000 tonnes of HRW wheat to Brazil during the 1998/99 crop year. The bilateral agreement allows for US exports solely from the country's "central region," or the seven major producing states of Texas, Oklahoma, New Mexico, Kansas, Colorado, Nebraska andMissouri.

In addition, all US wheat headed to Brazil would have to pass through the Gulf of Mexico or through smaller ports along the Mississippi River. According to US officials, it is the first time the US Animal and Health Inspection Service has granted regional safety certification for wheat sales to Latin America.

Brazilian officials also toasted the deal, which they said would help ease the country's long-standing Reliance on imports from neighbouring Argentina.

"This (the agreement) gives us another option," said Brazil's secretary for agriculture protection Dr Enio Antonio Marques Pereira.

As a Mercosur trade partner, Argentina supplied 86 per cent of the 6.17 million tonnes of wheat Brazil imported last year, according to independent analysts Safras E Mercado.

Although Pereira said that imports from Argentina could fall slightly, he acknowledged that the country's proximity and preferential trade status would allow it to continue dominating sales in the future.

But industry sources sawthe deal providing a sorely needed safety-valve for Brazilian buyers as the country enters a forecast tight 1998/99 South American wheat season.

"The timing was good for Brazil," one US wheat exporter said. "They are facing a smaller Argentine wheat crop than in previous years, so it makes sense to them to not close their doors to any kind of wheat." Brazil's decision to restrict US wheat imports to HRW wheat also may soon change, said H Finn Rudd, Agriculture Counsellor at the US embassy in Brasilia.

"This is a starting point and we are not taking anything off the table," Rudd said.

He said that the deal would help pave the road to a closer bilateral trade relationship. He pointed to the US government's recent decision to open a US Animal and Plant Health Inspection Service office in Brazil in mid-December.

"This is the start of a new relationship and in the future we hope to work closely with them on these phytosanitary issues," Rudd said.

Topping Brazil's list of trade goals is expanding itsmeat exports to the United States from canned, processed meat to fresh-frozen beef, which is now barred from the US market.

Brazil, which boasts the world's second-largest cattle herd, was recently cleared by the leading international animal health organisation for eradicating hoof-and-mouth disease in its two major ranching states.

It is now supplying US authorities with phytosanitary information in hopes of clearing its beef for export.

"The same way we made the US provide innumerable reports on the safety of its wheat, we must now do the same for our cattle," Pereira said.