OTTAWA – The Canadian government began the week waiting for word from Washington on whether a Jan. 14 offer would be enough to head off a trade battle with the Americans over wheat sales to U.S. mills.
“The next step will have to be a call from (U.S. agriculture secretary Mike) Espy to Ralph,” said Mike Gillan, spokesperson for agriculture minister Ralph Goodale. “We hope to hear this week.”
Meanwhile, a U.S. International Trade Commission investigation into Canadian durum sales was expected to formally start Jan. 18 with a call for preliminary briefs. It could be called off later if the two countries agreed to a truce.
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According to government, industry and political sources, the Canadian proposal included an offer to:
- Accept volume limits on Canadian wheat exports south, as long as they are significantly higher than this year’s expected export level of 2.7 million tonnes.
- Open Canadian Wheat Board sales to confidential after-the-fact audits, similar to, but broader than, a recent audit of past durum sales. The audit offer would be limited to a few years.
- End by mid-1995 the use of Crow Benefit subsidies on grain moving to U.S. buyers through the Great Lakes.
- Drop end-use certificates on U.S. wheat coming into Canada.
However, to have a deal, those Canadian concessions would have to be accompanied by a list of American concessions that would:
- End investigations of Canadian grain shipments south.
- End Export Enhancement Program subsidies on American wheat being sold into traditional Canadian markets, from Mexico to China and Brazil.
- Drop threats to impose trade-disrupting end-use certificates on Canadian wheat going south.
No compromises
Canadian sources said Canada will not compromise on this list.
“You could say that the Americans began aggressively in December negotiations with a list of demands and in Toronto Goodale came back with his own list and now both sides realize the other is serious,” said an unnamed source. “It is a question if Espy and the Americans have an appetite for this broad a deal.”
One official said the Americans may not formally respond with concessions until after this week’s convention of the National Association of Wheat Growers in New Orleans.
The Americans have been trying to link the wheat issues with their demands that Canada lower tariffs on various supply-managed products, including ice cream and yogurt.
A Canadian government source Monday strongly denied any link will be made.
“All these issues are being discussed,” he said. “But there is absolutely no link between them.”
