Free-trade agreements with Peru and Colombia are crucial to maintain strong sales of western Canadian wheat and barley to these important markets, CWB president and CEO Ian White said, urging swift ratification by Parliament.
“Western Canadian farmers cannot afford to be left at a competitive disadvantage to the Americans,” White said from Lima, where he was part of a Canadian delegation to Peru and Colombia with Canadian Agriculture Minister Gerry Ritz and representatives of other agricultural commodity groups. “We need these trade agreements implemented.”
The United States implemented a free-trade deal with Peru in February 2009, guaranteeing its wheat duty-free access. Canada has negotiated similar bilateral agreements with Peru and with Colombia, but they await finalization.
“Our milling and malting customers here want to buy more Canadian wheat and barley because of its consistent high quality,” White said. “The negotiated agreements will give us parity with the U.S. and Argentina. They will enable us to increase sales and market share – but only once they take effect.”
The two markets together are worth about $230 million a year to western Canadian wheat and barley farmers, who sell an average of 780 000 tonnes of wheat and 83 000 tonnes of malting barley annually to these Andean nations.
Wheat import tariffs have historically been as high as 17 per cent into Peru and 15 per cent into Colombia. Without a free-trade deal, such tariffs would risk shutting Canadian grain out of these important, nearby markets for top-quality wheat.
Since 2003, the CWB has been urging the Government of Canada to forge bilateral deals with a number of countries to prevent Canadian grain exports from losing ground to international competitors. Eighty per cent of Prairie wheat production must be exported.
“We appreciate the efforts of Minister Ritz to push for speedy implementation of these important agreements,” White said.
Economic growth has been increasingly robust in both Peru and Colombia since 2002. In Peru, where bread and pasta are important parts of the diet, the CWB has established strong milling wheat sales White said customers here have made very positive comments about Canadian wheat quality and have a preference for Canadian wheat over any other origin. Peru produces most of its own barley, with Canada and Argentina supplying the remainder.
Colombia produces very little of its own wheat and barley. Annual per-capita wheat consumption, one of the lowest in Latin America, rose from 28 kilograms in 2003 to 30 kilograms in 2008. Beer consumption growth is even more dramatic, with malting barley imports almost doubling in the past decade, supplied mainly by Argentina and Canada.
Controlled by western Canadian farmers, the CWB is the largest wheat and barley marketer in the world. One of Canada’s biggest exporters, the Winnipeg-based company sells grain to over 70 countries and returns all sales revenue, less marketing costs, to Prairie farmers.
