The U.S. wheat industry says Canadian trade policies that limit the flow of U.S. wheat to Canadian delivery points costs the American industry as much as $50 million a year.
“The primary access barrier to Canada (for U.S. wheat) is that regardless of variety, all foreign grown grain automatically receives the lowest designation in … (Canada’s) official grading system,” said a document prepared by U.S. Wheat Associates.
“While difficult to estimate, we believe that the current (Canadian) policies result in a loss of up to $50 million in trade opportunities.”
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The document, which identifies foreign barriers to trade that affect the U.S. wheat industry, also said Canadian policies that discourage the sale of U.S. wheat in Canada have a disproportionate effect on producers in northern states.
“While the market demand in Canada for U.S. wheat is not large, the U.S. is Canada’s largest wheat customer, and equitable border treatment should be a high priority on both sides of the border,” it said.
“We estimate that more than three million metric tonnes of wheat in Montana, North Dakota and Minnesota is within 50 miles (80 kilometres) of a Canadian elevator, including 25 percent of North Dakota’s wheat production.”
The document said Canada’s variety registration system has limited the number of U.S. wheat varieties registered in Canada to 41 in the past 10 years.
“The variety registration system is … overly burdensome, involving criteria unrelated to quality or marketing and requiring multiple years of field testing to achieve a class designation,” it said.
“This restrictive process of registering U.S. wheat varieties in Canada is not a practical solution.”
The American document, entitled Comments Regarding Foreign Trade Barriers to U.S. Exports for 2016 Reporting, is the USWA’s submission to the 2016 National Trade Estimate Report on Foreign Trade Barriers.
Each year, the Office of the United States Trade Representative re-quests comments from U.S. industry that outlines trade barriers limiting the sale and export of U.S. goods.
The wheat industry document, dated Oct. 28, also suggests that the U.S. should pursue new trade agreements to offset those negotiated by other wheat exporting nations.
“The number of free trade agreements between customs unions and countries is increasing at a rapid pace,” the report said.
“Australia, Canada and the European Union have concluded or are negotiating agreements with wheat importing countries that have already or will put U.S. wheat farmers at a price disadvantage due to tariff differences. The United States must be active in pursuing new trade opportunities to maintain and increase export opportunities for U.S. wheat producers.”
