Curb urged on imports of wheat

July 09, 1994|By Bloomberg Business News

WASHINGTON -- A federal trade panel ruled yesterday that a flood of Canadian wheat shipments to the United States is crippling U.S. farm programs and said imports should be curbed.

The decision by the International Trade Commission is seen as a victory for the Clinton administration, which sought restrictions. The finding could strengthen the hand of top U.S. trade and agricultural officials in resolving differences with Canada over trade in wheat and other agricultural goods.

In its decision, the bipartisan panel held that the surge in durum wheat imports over the past four years drove down wheat prices in the United States, increased U.S. government subsidies and requires retaliatory restrictions, such as quotas or tariffs.

Commissioners said they met the legal requirement of finding that imports caused "material interference" with the U.S. wheat subsidy program.

"Imports have resulted in lower prices in the domestic market," declared Commissioner David Rohr. "Imports are compromising" the integrity of the U.S. wheat subsidy program and are hurting family farmers in northern-tier wheat states.

The ITC commissioners, three Democrats and three Republicans, now report their formal findings and recommendations to President Clinton by next week, who may accept, reject or ignore their advice.

Canada has threatened to retaliate against shipments of U.S. wine, whiskey, canned goods and other products, if the United States proceeds with its threats.

Mr. Clinton ordered the ITC to investigate imports of durum wheat, the kind used to make pasta, last November after wheat-state senators complained that a flood of price-depressing imports were devastating local wheat markets in North Dakota, Montana and Minnesota.

Wheat growers applauded the decision. "They can't just use the U.S. as a dumping ground," said Winston Wilson, president of U.S. Wheat Associates.

The long-simmering trade dispute has soured relations on both sides of the border, as interest groups representing dairy, poultry and sugar also have pressured each side.

At stake is two-way trade between the U.S. and Canada which exceeds more than $210 billion a year. Agricultural trade represents about $10.9 billion, or about 5% of the total.

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