Door opened to U.S. wheatYear Published: 1992
Resource Type: Article
Cx Number: CX4439
Abstract: Thanks to a provision in the Canada-U.S. Free Trade Agreement, barriers to the import of U.S. wheat have now been lifted. International Trade Minister Michael Wilson has lifted Canada's import licensing requirements, which effectively kept U.S. wheat out of Canada for 48 years. Under a formula in the Free Trade Agreement, Canada was required to drop the licenses whenever Canadian subsidy levels were the same or greater than those in the U.S. Subsidies are calculated on a two-year period, so when western farmers received federal deficiency payments to assist them in two consecutive drought years, Canadian subsidy levels were temporarily higher. According to Nettie Wiebe of the National Farmers' Union, this represents a "historical blip". "If you had taken any two years over the last fifty, you would have found that U.S. subsidies were higher." However, thanks to the agreement signed by the Progressive Conservative government, huge U.S. flour mills are now able to sell flour at loss-leader prices into the Canadian market. The effect will be that some Canadian mills will close down, and prices paid to Canadian farmers will be forced down. Already this year, Canadian mills successfully pressured the Canadian wheat board to sell them wheat at less than the price paid to farmers. According to Wiebe, none of this is a surprise: "They're not hiding the fact that in the Free Trade Agreement the Wheat Board is one thing they (the Americans) wanted to destroy."
-Source: Action Canada Dossier