The Canadian Wheat Board is trying to round up allies in its battle to survive ongoing attacks in world trade talks.
The grain marketing agency last week sent a letter to all member countries of the World Trade Organization defending itself and attacking the United States and European Union for their actions in world grain markets and their stance in trade negotiations.
It urges the WTO members to resist efforts by the two economic superpowers to impose new constraints on single desk marketing systems that operate in accordance with existing trade rules.
Read Also
First annual Ag in Motion Junior Cattle Show kicks off with a bang
Ag in Motion 2025 had its first annual junior cattle show on July 15. The show hosted more than 20…
“Why should any country have to forgo the policy flexibility to choose marketing structures that may be appropriate for its agricultural situation and that have not been shown to have a trade-distorting effect?” said the 1,100-word letter signed by CWB chair Ken Ritter.
He said in the letter there is no evidence that single desk trading entities distort world trade.
Ritter said it’s unfair and hypocritical for the big powers to impose their preferred marketing systems on everyone else, especially in light of the huge subsidies paid to farmers in the U.S. and EU.
“To suggest that the only marketing systems that should be followed are those practised by the superpowers with large government treasuries is outrageous, given the source of the vast majority of existing trade distortions in agriculture,” he said.
The board sent the letter April 6, the same day as the WTO formally released its decision in a complaint by the U.S. against Canadian grain marketing practices.
In that ruling, first reported in February, the WTO panel dismissed U.S. claims that the CWB breaks international trade law and engages in unfair non-commercial grain trading practices.
It did find that several Canadian grain handling and transportation policies discriminated against imported U.S. grain in violation of WTO rules.
Both sides have 60 days from the release of the 231-page decision to file an appeal with the WTO’s appellate body.
The U.S. and the EU are demanding in world trade negotiations that in return for any scaling back of their own subsidies that new “disciplines” be imposed on state trading entities like the CWB and the Australian single desk wheat seller AWB Ltd.
Canada’s chief agricultural trade negotiator Steve Verheul told a meeting of the Canada Grains Council last week that Canada has few allies on the issue other than Australia and China, because not many countries have single desk marketing structures.
He said that is a concern, but added last week’s WTO decision could bolster Canada’s case.
“I think it was one of the clearest decisions I’ve seen out of the WTO and clearly rejected all of the U.S. arguments that the wheat board was trading unfairly,” he said.
Ritter said in his letter to WTO members that while the U.S. and EU talk about disciplining state trading entities, they really want to dismantle the board so it can no longer operate as an effective competitor.
Instead of trying to solve problems that don’t exist, trade negotiators should focus on the real issues, such as export subsidies, misuse of export credits and food aid, and trade-distorting domestic subsidies.
Canadian grain farmers are willing to accept disciplines on domestic policies that are actually trade distorting, said the CWB chair.
But they don’t understand why their grain marketing system, which has been found to be fully compliant with existing WTO rules, should be subject to any new disciplines that would destroy their ability to market through a farmer-controlled structure similar to a co-operative.
“To say that new disciplines are necessary based on the unsubstantiated allegations of the superpowers makes a mockery of the rule of law,” he said.
The letter was sent to the Geneva-based ambassadors of WTO member countries and asks them to forward it to the appropriate officials in their national capitals.
