The largest delegation at last week’s hearings into the duty on imports of American corn came from B.C.’s Fraser Valley.
Dairy and poultry farmers in the valley, where land and feed costs are exorbitant, worry that an increase in feed costs will threaten their businesses.
Dairy farmer Ben Brandsema estimated the duty could cost milk producers $3 million per year.
Chicken farmer Rick Thiessen thinks poultry production costs could rise by $6.5 million per year in the province.
Brandsema and Thiessen told the Canadian International Trade Tribunal they should be exempt from the duty because they can’t get the quantity or quality of corn they need in Western Canada at competitive prices.
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Tribunal research shows 22 percent of corn imports in recent years have gone to B.C., while 24 percent of Manitoba corn has made its way across the Rockies.
Brandsema explained B.C. dairy farmers feed their cows corn to get the most milk with the highest possible protein content.
Chicken farmer Arne Mykle said B.C. poultry farmers have the highest rate of grain and feed conversion in the country because they rely on corn for production efficiencies.
Mykle pointed out Manitoba corn growers produced about 10 million bushels of corn in 1999-2000, yet Manitoba livestock producers alone used 12 million bushels of the crop. That doesn’t include demand from the Seagram distillery, he noted.
“The point I would like to leave with the panel is simply this: how can we in British Columbia expect a consistent supply when the demand here in Manitoba exceeds the production?” said Mykle, who is also part owner of a feed mill.
Look close to home
Thiessen told the panel Manitoba corn producers would likely look after poultry farmers in their own province first.
He said it’s “a bit of a myth” that chicken farmers will get their increased feed costs back in higher costs from consumers.
B.C. dairy producers also complained that Manitoba producers can’t grow the right kind of corn for their cows.
To meet this need, the largest feed mill in the Fraser Valley has started buying some of its corn from Ontario.
Chuck Poelman, chief financial officer of Ritchie-Smith Feeds, testified his company starting buying some corn from the Sarnia, Ont., region in December.
Before the duty was levied Nov. 7, U.S. corn was priced at $155 per tonne, delivered to Abbotsford. Now, it is $164 per tonne, plus a $94 duty.
Ontario corn is priced at $194.50 per tonne, while Manitoba corn is $10 to $12 per tonne lower.
Ritchie-Smith Feeds continues to import some U.S. corn thanks to “duty drawbacks” earned from shipping feed to Washington State, Poelman said.
The B.C. farmers and feed companies also complained Canadian grain transportation snarls make it hard to get reliable deliveries of corn to their mills.
Top rate service
Broker Jan Leishman told the panel she gets good service and prices from the CP-owned Soo line that collects corn from the northern U.S. and brings it into Canada at North Portal, Sask.
“We have the best of both worlds there,” said Leishman, who works for Perdue Shafer Inc. in Morden, Man.
The U.S. rail car allocation system is more accountable and efficient, she said, adding U.S. elevators are better equipped to handle and grade corn.
“Corn cannot be loaded through these modern elevators up here in Canada because they do not have the right equipment,” said Leishman.
It costs $40 to $65 per tonne more to truck grain from Manitoba to B.C. than ship by rail, noted Leishman.
Peter Clark, lawyer for the Manitoba Corn Producers Association, accused B.C. feed mills of being afraid of competition.
Out of four major corn suppliers to the province, three are American-owned. The other is Agricore.
The Canadian-owned company is the only one to ship significant amounts of Manitoba corn to B.C., Clark said.
Clark also said B.C. feed companies didn’t provide evidence of corn imports to the tribunal.
He noted Ontario corn producers now estimate they will export only 100,000 tonnes of corn to B.C. this year because of a small crop and high freight costs.
