May 15, 2007

 

Canadian Wheat Board, Peru discuss trade opportunities

 

 

Senior officials with the Canadian Wheat Board (CWB) met Monday with Peru's ambassador to Canada to discuss enhanced trade opportunities for western Canadian wheat and barley, a release from the CWB said.

 

Peru is among the fastest-growing Latin America markets for Western Canadian grain, the CWB said.

 

"There are tremendous opportunities opening up for Prairie grain in Peru and the other Andean nations--and that's what we focussed on today," CWB president and CEO Greg Arason said of the meeting with Guillermo Jose Miguel Russo-Checa.

 

Prospects for malting-barley sales have exploded as rebounding economies in this region create double-digit increases in beer consumption. The CWB also made record wheat sales to Peru in 2006. However, Arason said this growing trade relationship is now threatened by a bilateral free-trade agreement between the US and Peru that could put western Canadian farmers at a serious competitive disadvantage.

 

"Our grain customers in Peru have forged an excellent relationship with the CWB and would love to see it expand," Arason said. "However, if we are faced with a 17 percent tariff disadvantage to the US, they have told us that it will be impossible to ignore a cost difference of roughly US$45 per tonnene of grain."

 

Since 2003, the CWB and other agricultural exporters have joined forces to urge Ottawa to forge bilateral trade agreements to ensure Canadian exports do not lose ground to international competitors. Canadian International Trade Minister David Emerson recently indicated that negotiations with key Latin American countries would soon begin.

 

"The CWB has been working hard to develop customer relationships that have positioned us well," Arason said. "We urge the federal government to forge ahead with its plans to pursue the same trade access for Canada that the United States will soon enjoy."

 

For example, the CWB has worked to make Western Canada a major supplier of malting barley to brewers SAB Miller in the Andean nations of Peru, Colombia, Ecuador and Chile. Malting-barley sales to Peru, worth about C$2.7 million in calendar 2006, are expected to increase by more than C$2 million over the next year. Prairie malting-barley sales to Colombia, last year at roughly C$12.5 million, are also expected to grow significantly.

 

The value of CWB wheat, durum and barley exports to Peru and Colombia in 2006 totalled almost CUS$250 million. Wheat sales to Peru alone in 2006 were a record 575,000 tonnes, a 33 percent increase over 2005.