Americans angry about high levels of grain imports from Canada simply will have to get accustomed to them, a U.S. trade delegation was told during a meeting in Ottawa June 27.
Close to the record 1.5 million tonnes are expected to flow south during the year and American politicians are under pressure from some grain organizations to control the flow.
“They will just have to get used to the idea that this is normal,” a Canadian trade official said last week, speaking on the condition of anonymity.
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“We told them this could well be a normal year. There are no distortions causing this. In a normal market, they should come to expect this level of sales or more.”
This is not what an American trade delegation came to Ottawa last week to hear.
The Americans showed up to complain that Canadian exports this year will be near or higher than the 1.5 million-tonne one-year limit placed on exports in 1994.
“They suggested we restrain ourselves,” Charles Larabie, a spokesperson for trade minister Sergio Marchi, said in an interview after the meeting.
In turn, the Canadians offered something of a gentle lecture on free trade.
“Restraints are just a non-starter,” said Larabie. “This trade is being done fairly. End of story.”
Another trade official said the Canadians told the Americans they should stop trying to make comparisons between 1994 and future years.
In 1994, American supplies were down because of floods and there was a high demand for Canadian feed grains. At the time, the U.S. had a trade law that could be used to impede imports.
Now, sales south across the border are high because there is a demand from American buyers, particularly flour mills that have developed a preference for Canadian milling wheat.
There are no subsidies involved and the implementation of new world trade rules in 1995 ended the U.S. ability to block imports unilaterally.
“Much of what has to be done is to demystify how the Canadian system works,” said the Canadian trade official. “The Americans tend not to know details of the Canadian side of things. They imagine subsidies and other practices that simply do not exist.”
For that reason, he said Canada is happy to continue holding “consultations” with the Americans on the issue of the grain trade.
“It might raise the level of understanding and decrease the level of suspicion and supposition.”
The two sides are expected to get together again in late summer. Larabie said Marchi and U.S. trade representative Charlene Barshefsky also are trying to arrange a meeting this summer on a range of issues.
“We expect grain might be on her shopping list,” he said. “It will not be on ours.”
Some Canadians sounded almost sympathetic after the meeting, noting that the U.S. side has to appear to be “doing something” because of domestic political pressures and anti-free trade sentiment in the Great Plains states where election campaigns are pending.
