The first sale of U.S. wheat to Morocco under a free trade agreement between the two countries has increased the urgency for Canada to reach a similar agreement.
“It’s a huge concern,” said Janelle Whitley, a trade policy analyst with the Canadian Wheat Board.
“Morocco is an extremely important customer for us, one of our top five buyers.”
She said the board and other agricultural groups have encouraged the federal government to continue its efforts to negotiate a similar deal with the North African kingdom.
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Canada is the leading exporter of durum to Morocco, shipping an average of 560,000 tonnes a year over the last three crop years. The exports are worth more than $200 million a year to prairie growers.
Wheat board sales account for 90 percent of Morocco’s durum imports.
However, that market dominance could be threatened by the U.S.-Morocco trade deal, which provides tariff-free access for U.S. durum.
Morocco recently bought 200,000 tonnes of bread wheat from the U.S. under the deal, which was signed in 2006 with a 10-year implementation period.
Whitley said that particular sale is not a big concern to the board because it involved bread wheat, which Canada doesn’t sell to Morocco.
However, the deal will eventual include durum.
The agreement calls for Morocco to hold annual auctions under a quota system that provides preferential tariffs for U.S. wheat and durum. By 2016, those quotas will be 340,000 tonnes of durum and 400,000 tonnes of bread wheat.
After that, U.S. durum will enter Morocco duty-free, while a preferential duty will remain on bread wheat.
Whitley said that will give the U.S. a $100 a tonne advantage over Canadian durum in 2016, unless a similar deal is negotiated.
Federal government officials met with Moroccan counterparts in Rabat, Morocco, in April 2009 to talk about a possible free trade deal, followed by similar meetings in Ottawa in June.
In October, Ottawa launched consultations with the provinces and territories, businesses, industry associations and the general public on possible trade negotiations with Morocco.
The country is also an important market for Canadian pulse crops, which face import duties of 50 to 80 percent, while many nearby countries face substantially lower or even zero duties.
Pulse Canada said pulse importers in Morocco also support free trade with Canada, which allow more direct business dealings with Canada.
It said import duties add as much as $400 US per tonne to the cost of imported pulses.
