November 11, 2004

 

 

US Soybean Rust May Lead to Stricter Import Rules in Canada

 

With the discovery of soybean rust in the United States, Canadian oilseed crushers are concerned that this could mean stricter rules for US soybeans they import to make oil and livestock feed, according to an industry official.

 

Canadian regulators were considering more inspection for US soybean imports before the first case of the yield-reducing disease was found in Louisiana on Wednesday, said Bob Broeska, president of the Canadian Oilseed Processors Association.

 

"We're working with (the Canadian Food Inspection Agency) to make sure they don't impose too stringent an inspection process that would hinder trade," revealed Broeska.

 

According to US Department of Agriculture data, Canada imported 640,000 tons of soybeans in the year ending Aug. 31, 2004, mainly from the US.

 

Broeska said the beans cannot infect Canadian fields as they are shipped directly to processing plants, chiefly to southern Ontario plants owned by Archer Daniels Midland Co. and Bunge Ltd.

 

US officials said the disease would likely spread, but it is not known how prevalent the disease was nor how quickly it would travel.

 

The spores of the fungus can travel long distances by the wind, which makes it difficult for regulators to control, said Steve Cote, a commodity officer with the Canadian Food Inspection Agency.

 

"The only thing that we can do is try to limit the man-made spread of this disease, and that is through the regulation of imports of grain or soybeans if we determine that there is a risk," Cote added.

 

For instance, the CFIA could require imports to be certified as free of plant debris that can harbor the fungus.

 

"I doubt that we'll go down that road, depending on the extent of infestation in the United States," he said, adding the agency will determine if more rules are needed after an evaluation by the US Animal and Plant Health Inspection Service.

 

CANADIAN FARMERS WARY OF YIELD DAMAGE, CHEMICAL COSTS

 

The disease is unlikely to survive severe Canadian winters because it needs green plant material as a host, Albert Tenuta, a plant pathologist with the Ontario government, pointed out.

 

But rust could slash Ontario yields by 10 percent to 20 percent in some years depending on wind patterns and how readily it takes hold in the southern United States, he said.

 

Canada's soybean crop is estimated at 2.9 million tons. More than three quarters of the crop comes from Ontario, making it a fraction of the 84.6 million ton US harvest.

 

The C$600 million ($504 million) crop is crushed for its vegetable oil and meal, and fed to livestock. About a third of Ontario's crop is exported, mainly to Asia and Europe for use in food.

 

Farmers can reduce the yield impact with fungicides, which Tenuta estimated could cost C$12 to C$20 per acre.

 

"Any cost is significant to producers when the margins are tight," he said.

 

Canada's Pest Management Regulatory Agency has reviewed four fungicides to fight rust, and has approved them for emergency use if required, spokesman Chris Krepski said.

 

($1=$1.20 Canadian)