WINNIPEG (Staff) — The Canadian Wheat Board is helpless to stop what industry sources say is an increasing number of illegal exports of wheat and barley into the U.S.
The board can no longer enforce a provision of the Canadian Wheat Board Act requiring exporters of prairie grain to get a permit from the board, chief commissioner Lorne Hehn said in an interview last week.
“We don’t have a vehicle to properly enforce that law.”
Hehn said the board can’t even accurately gauge how much illegal movement is occurring since changes to Canada Customs reporting regulations were implemented two years ago.
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In the past, commercial trucks leaving Canada were required by law to stop at Canada Customs with a form called the B-13, which reported to Statistics Canada the volume and type of goods being exported. If those goods fell under the board’s jurisdiction, Canada Customs then required the truck driver to provide the export permit.
That system was phased out under an agreement to harmonize reporting procedures to the two governments. Statistics Canada now gets its export information from U.S. Customs.
Not stopped at the border
Trucks leaving Canada are no longer required to stop at Canada Customs on the way out. It means trucks hauling grain into the U.S. will only have their export permits checked if they choose to stop and show them.
“It’s an honor system, virtually,” said Hehn. He said he doesn’t believe the abuse is widespread, but “the trucks are not required to stop at Customs so we have no way of knowing.”
Tracing illegal exports after the fact is impossible because U.S. Customs only reports aggregate volumes, not specific shipments, he said.
But Hehn said the board will investigate if it receives information about illegal movements.
More farmers seem willing to flout the system. Most notable is Andy McMechan, a Pierson, Man. farmer who hauled barley into the U.S. without an export permit, and then called up the local radio station to talk about it. He is under investigation by the RCMP.
But sources say he’s not alone.
- Some farmers are talking about an organized campaign of illegal grain hauling if McMechan is charged.
- Sources also say some farmers have obtained an export permit for a small volume of grain and then hauled several times that volume into the U.S. on the same permit.
- Farmers in southern Manitoba, angered by the board’s refusal to accept grain infected with more than five percent fusarium head blight, have moved it into the U.S. market — where in some cases it fetches a protein premium.
Technically, it’s illegal to sell that grain except to a domestic user. Since the board didn’t establish an initial price for that type of wheat, there was no provision allowing the board to buy it from the farmer and sell it back in order to issue an export permit.
