A delegation of Canadian Wheat Board officials will be in Ottawa this week talking to government ministers about the impact of the latest World Trade Organization agreement on the grain marketing agency and prairie farmers.
“We want to hear right up front exactly where we stand,” wheat board chair Ken Ritter said in an interview last week.
Ritter, chief executive officer Adrian Measner and other officials were scheduled to meet Aug. 26 with international trade minister Jim Peterson, agriculture minister Andy Mitchell and CWB minister Reg Alcock.
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The board has criticized the federal government for signing a new WTO negotiating framework July 31, saying Ottawa has betrayed western farmers. It called for the government to adopt a tougher attitude in future negotiations and demanded financial compensation for farmers.
The framework, which forms the basis for negotiations during the coming year, states that any new world trade deal will include an end to government guarantees and underwriting of losses for state trading enterprises such as the CWB.
Board officials have called on Ottawa to compensate farmers by setting up an alternative fund to guarantee initial payments and the board’s borrowings.
The deal also says the future use of monopoly powers will be subject to negotiation, a clause that board officials say puts the single desk at risk.
Ritter said the board is looking for answers from the ministers on how the government will deal with those issues in the upcoming WTO talks.
“We’re not going to resolve anything in a definite way at this meeting,” he said. “We just want to understand the lay of the land and establish a process on where we go from here.”
The board’s warnings about the impact of the deal and call for compensation have met a lukewarm response from Grain Growers of Canada, whose western members include the Alberta Barley Commission, B.C. Grain Producers Association, Manitoba Corn Growers Association and Canadian Canola Growers Association.
Executive director Cam Dahl said the wheat board has overreacted to the framework deal and is jumping the gun by issuing demands for compensation.
“I think any discussions on that are a long, long way off,” he said. “We should not prejudge the outcome of WTO negotiations that have not yet concluded, or the outcome of domestic discussions on the issue of market flexibility.”
He said any harm to Canadian grain and oilseed growers from the loss of government guarantees to the CWB will be more than offset by the “significant gains” from a reduction in competitors’ domestic support programs and elimination of export subsidies, as called for in the framework.
One of the issues that has arisen with the July 31 framework agreement centres on why the federal government’s commitment to underwrite CWB losses ended up in the section of the agreement dealing with export subsidies.
Until now, any such payments have been reported to the WTO as domestic support payments under the aggregate measure of support, or AMS, not export subsidies.
The last such payment was roughly $85 million, to cover losses incurred in the 2002-03 wheat pool account.
“We haven’t formally notified that yet, but in the event that we do it would be notified under our AMS, which is domestic support,” said Denis Landreville, deputy director of Agriculture Canada’s trade negotiation office.
Wheat board senior counsel Jim McLandress said Canada could use that precedent in the next round of talks to argue that export subsidy disciplines should not apply to any underwriting of CWB losses.
“It’s certainly been our position all along that they have no place in a discussion of export subsidies,” he said.
McLandress said a WTO panel report on the CWB, the final version of which is to be released Aug. 30, concludes that the CWB does not use any trade distorting export subsidies. However, he added that previous reports exonerating the CWB have often been ignored.
