Relaxed rules on U.S. wheat imports possible

Canadian farmers have nothing to fear if Canada gives the United States wheat access to its grading system, say industry executives.

However, not everyone agrees with that sentiment.

U.S. Wheat Associates and the National Association of Wheat Growers have lobbied for years for fair treatment of American wheat.

Right now any U.S. wheat that crosses the border is automatically assigned a feed grade, even when it is a variety registered in Canada.

Bill C-48, which was legislation designed to modernize the Canadian Grain Commission, was going to address the inequity, but it was derailed by the 2015 federal election.

The issue recently resurfaced during the renegotiation of the North American Free Trade Agreement.

Stewart Wells, former president of the National Farmers Union, bristles at the notion that this is a trade irritant.

“It’s being portrayed that way by the same people who said that the Crow Rate was a trade irritant and we should just get rid of it,” he said.

“And then when that was gone they moved on to the Canadian Wheat Board and said the Canadian Wheat Board was a trade irritant and we should just get rid of it.”

Wells believes they are now targeting the commission and Canada’s grading system.

“It’s just a further deterioration of the Canadian system, which ends up meaning less money in the pockets of farmers.”

Tom Steve, general manager of the Alberta Wheat Commission, said fears of Canada being inundated with American wheat are misplaced.

Canada typically exports 2.5 to three million tonnes of wheat and durum to the U.S. and imports only 50,000 tonnes.

“We don’t need the wheat as badly as Americans need Canadian wheat. I think it’s as simple as that,” he said.

Canada produces more than enough wheat for its own purposes, and U.S. wheat is disadvantaged by the exchange rate.

Steve said Canadian grades would be made available only to U.S. varieties registered in Canada, which are primarily three dark northern spring varieties growing in Manitoba and eastern Saskatchewan.

He said the issue is not worth causing a trade irritant with Canada’s largest wheat customer.

“It just makes sense if we’re wanting to have open access to their market that they should have some opportunity to have their wheat graded under our system,” said Steve.

Wade Sobkowich, executive director of the Western Grain Elevator Association, said allowing U.S. grain to receive a Canadian grade would not affect quality.

“If our main concern is preservation of the quality and the classes, then it really shouldn’t matter if the variety is grown on Canadian soil or American soil,” he said.

Sobkowich said it makes sense to allow U.S. wheat to receive Canadian grades as long as it is restricted to varieties registered in Canada.

He agreed with Steve that it wouldn’t result in a flood of grain crossing the border. U.S. wheat is already sold at Canadian elevators based on specifications rather than grades.

However, very little of that U.S. grain flows north into an identity preservation system because the economics aren’t there.

“It doesn’t pencil out,” said Sobkowich.

“We’re not going to see a huge amount of U.S. wheat coming into Canada if this change were made.”

Wells said if that’s the case, he wonders why it has become this big of an issue.

“If no significant amount of U.S. grain is (going to be) coming in, what’s the issue then? Why are they worried about it?”

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