Over the next four months, the Canadian government will conduct a detailed investigation into whether the United States is dumping and subsidizing corn, and whether its actions harm western Canadian corn producers.
“It’ll heat up here now,” said Mike Coates, vice-president of the Manitoba Corn Growers Association.
Last week, the Canada Customs and Revenue Agency slapped a temporary duty of $1.58 (US) per bushel of corn shipped north across the border.
The duty was in response to its preliminary investigation, which revealed U.S. corn was dumped in Western Canada at prices averaging $1.01 per bu. below profitable levels, and subsidized by an average of 57 cents per bu.
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Canada Customs will further examine export patterns and U.S. government programs, and will issue a final decision about the dumping and subsidies on Feb. 5, 2001.
It will question exporters and importers that ship U.S. corn to Canada, as well as the U.S. government, about costs, “normal values” for corn and government programs.
During its preliminary investigation, Canada Customs received information from only nine of 133 U.S. exporters.
Its list of exporters ranged from individual farmers and small elevators to large grain companies such as Benson-Quinn, Cargill, Con-Agra and Cenex Harvest States Cooperatives.
Out of 134 importers, only 14 Canadians responded.
Canada Customs’s list of importers includes all major prairie feed companies, most major grain companies, Hutterite colonies and other livestock producers.
In its preliminary decision, Canada Customs fingered as subsidies the U.S. loan deficiency payments and marketing assistance loans, emergency farm relief payments and federal crop insurance programs.
The corn growers had complained about a long list of U.S. programs, but Canada Customs found most either weren’t subsidies, such as ethanol programs, or were “non-actionable” subsidies under trade agreements, such as set-aside programs.
The duty will stay in place until at least March 7, 2001, when the Canadian International Trade Tribunal makes its final decision on whether Manitoba corn farmers have been injured.
The CITT will hear from organizations that oppose the duty, such as the Canadian Pork Council, the Animal Nutrition Association of Canada, the British Columbia Agricultural Council and the Office of the U.S. Trade Representative.
While much of the trade tribunal’s work will take place through questionnaires, research and closed meetings, it will hold a public hearing into the complaint on Feb. 5 in Winnipeg.
Duties collected will be refunded to corn importers if Canada Customs and the trade tribunal find their original impressions of the case were wrong.
Or, they could be extended for as long as five years, said Dan St. Arnaud, a senior program officer with Canada Customs.
St. Arnaud said affected parties can also argue for a smaller duty at a public interest inquiry, held after the trade tribunal’s March 7 decision.
