Import tariffs that blocked exports of hard red spring wheat to the United States for almost three years should be history by mid-February.
The U.S. Department of Commerce expects to publish shortly the final formal notice required to lift the tariff on hard red spring wheat.
“We’re waiting for the revocation notice to be published in the federal register,” Audrey Twyman of the department’s import administration said Feb. 1.
“We need signatures and it should happen within a week or two.”
Last week, the department published what is called a “Timken Notice,” notifying interested parties that the rules have changed in the wake of a ruling by the U.S. International Trade Commission that imports of Canadian wheat were not harming U.S. farmers and the 14.15 percent anti-dumping and countervailing duty tariff must be lifted.
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The duty will remain in effect until the revocation notice is published. Once that happens, any funds collected after Jan. 2, 2006, will be refunded.
Canadian Wheat Board officials welcomed this latest step in the long and expensive legal battle to get rid of the import duty, which has been in effect in one form or another since March 2003.
The duty effectively closed the door to what had become a lucrative market of around one million tonnes, generating about $250 million in annual revenue for Canadian wheat growers.
However, the board also said that the end of the tariff won’t produce an immediate resumption of business south of the border.
Some modest volumes may begin to move in March, but U.S. millers have already established their grists and filled most of their needs for 2005-06.
“We’ve been saying all along that it’s probably not until the new (2006) crop is in that there would be any significant exports to the U.S., and even then it depends on what we see in terms of crop quality,” said CWB spokesperson Maureen Fitzhenry.
While the tariff shut off most sales, a small amount of wheat did move across the border, with U.S. buyers paying several hundred thousand dollars in duties.
Exactly what will happen to that money remains up in the air, said Fitzhenry.
According to a U.S. Customs website, $364,000 U.S. was being held as of October 2005 for possible distribution to the North Dakota Wheat Commission, which instigated the case.
According to the website $91,791 had been paid to the commission as of that date.
However the Byrd Amendment, the U.S. trade legislation that allowed for duties to be paid to third parties such as the NDWC, has been ruled illegal by the World Trade Organization and had been expected to be repealed by the U.S. Congress. The U.S. House and Senate have agreed to a two-year delay of a repeal. The initiative has yet to be approved by U.S. president George Bush.
Fitzhenry said the board doesn’t think the NDWC should receive money from the tariff and thinks its customers should be reimbursed in full.
But there’s really nothing the board can do, she added.
“There are no avenues to pursue the return of the tariff, except to wait and see if an opportunity arises along the way,” she said.
“The key for us is that the pool accounts are not out any money.”
The wheat tariff duty was imposed in response to a 2002 complaint by the NDWC that the board was dumping subsidized wheat and durum into the U.S. market.
Provisional duties were put in place in March 2003. The tariff on durum was lifted in Oct. 2003 following a decision by the ITC, while a 14.15 percent tariff remained in place.
In June 2005, a binational panel set up under the North American Free Trade Agreement ordered the ITC to review its decision and on Oct. 5 the commission reversed its previous ruling, finding no injury.
The legal battle to eliminate the tariff cost prairie farmers an estimated $11 to $12 million.
