N.D. wheat farmers blast Canadian government’s help to CWB
North Dakota wheat farmers denounced the Canadian government’s recent role in helping the Canadian Wheat Board to cover its costs for grain purchases.
The Canadian Wheat Board (CWB) said this week it does not have enough money in its 2002-2003 fiscal year budget to pay Canadian farmers for its purchases of hard red spring wheat. By law, the Canadian government must step in to cover the CWB’s deficit.
The CWB lost $7.48 per metric ton, or 20.4 cents per bushel, across sales of 8.7 million metric tons (320 million bushels) of spring wheat for a total deficit of $65 million. According to the North Dakota Wheat Commission, the Canadian government payment to the CWB will amount to a 4.1 percent export subsidy.
“Twenty cents per bushel is more than enough of a price difference to swing sales in the international wheat market,” said Neal Fisher, administrator for the North Dakota Wheat Commission in a statement.
The CWB has a government-granted monopoly on all sales of wheat and barley from prairie provinces to domestic processors and export markets.
“Without competition on the procurement end and no real break-even price, the CWB prices wheat in a non-commercial manner,” Fisher said. “It robs American farmers of sales opportunities, market share and a decent price.”
U.S. Commerce Department completed an investigation of the CWB’s export activities this fall, resulting in a final duty on spring wheat imports from Canada of 5.29 percent to offset the subsidies and 8.86 percent to compensate for dumping, for a combined duty of 14.15 percent.
The CWB has appealed the Commerce Department’s decision before the North American Free Trade Agreement dispute panel. A World Trade Organization dispute settlement panel is also reviewing Canadian government policies and CWB trade practices with a final decisions expected in 2004.