Canada’s wheat grading system irks U.S. growers

PHOENIX, Ariz. — Canadians need to look at how they treat U.S. wheat before they get too high and mighty about U.S. country-of-origin labelling, says U.S. Wheat Associates.


“I would suggest that what Canada is doing with requiring origin labelling of U.S. wheat going into Canada is a very similar situation in reverse,” USW president Alan Tracy said during an interview at the 2015 Commodity Classic.


U.S. wheat delivered to a Canadian grain elevator automatically receives a feed grade or the lowest grade available.


Tracy said that is unfair because a lot of U.S. wheat meets the same end-use quality characteristics as Canadian varieties and in many cases has similar physical characteristics.


“We’d like to see a more open border both ways,” he said.


“At this point, it’s open going south and not very open going north.”


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Proposed legislation could address some of the association’s concerns. Bill C-48, which is legislation to modernize the Canada Grain Act, was introduced in the House of Commons Dec. 9.


An amendment in the bill says U.S. grain would be assigned a grade “constituting the highest level of excellence for which the grain is eligible.” 


The catch is that only varieties registered for use in Canada would be eligible to receive a grade, and not many of those varieties are grown in the U.S.


It’s why the United States is also pushing for reforms to Canada’s variety registration system, which the Canadian Food Inspection Agency is considering.


Wheat trade will continue to be a one-way street until the desired reforms are in place. Canada exported 2.66 million tonnes to the U.S. in 2014, up from 2.42 million tonnes the previous year and 1.74 million tonnes in 2012.


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Tracy said a lot more wheat has headed south in trucks in the past couple of years, which he attributed to Canada’s rail transportation problems.


“It’s a little bit concerning, but I think most people recognize the transportation problems you had in Canada,” he said.


“It’s natural that wheat is going to flow to where it’s worth more.”


Tracy figures it is only a matter of time before prices in the two countries fall into line with one another under the open market.


“We expect over time that you guys are going to sort things out and over time the farmer prices should equalize near the border for similar types of wheat,” he said.


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“We’re not ready to call out the troops, shall we say.”