GrainsWest Winter 2021

Winter 2021 Grains West 46 BY BRENNA MAHONEY How to keep trade flowing in a protectionist world CEREALS CORNER THERE IS A COMMON ADAGE IN agriculture: wheat is 14 per cent protein and 86 per cent politics. This applies as much to international markets as it does to domestic policy debates. The world had become protectionist before COVID-19, but the global pandem- ic accelerated the trend of economic na- tionalism. Countries are turning inward, finding new ways to block trade. So, how does Canada protect its trade relation- ships when the rules have been thrown out the window? The resolution of non-tariff trade barriers with Peru provides an example of how Canadian governments and the agriculture industry must work together to keep borders open. Peru is one of the top five importers of Canadian wheat, buying between one million and 1.5 mil- lion tonnes annually. In the summer of 2018, Peru notified the World Trade Or- ganization (WTO) of new phytosanitary conditions on Canadian grain imports. This notification cited the presence of weed seeds in Canadian shipments. Ubiquitous in Canada, these include sow thistle, knotweed and ragweed. It would be impossible, or at least commercially unfeasible, to ship grain from Canada that is free of these seeds. If Peru chose to enforce new phytosanitary conditions on Canadian shipments, the market would have been closed to us. Cereals Canada led the wheat industry response to this issue. We worked with the Canadian government to develop a common national approach to discussions with Peru. We worked with Peruvian importers and millers to develop post-im- port measures that would reduce the risk of weed seeds spreading during shipment and processing. Together with Canadian government agencies, we invited Peruvian regulators to audit the Canadian handling and transportation system, beginning with a commercial farm, through each step in the supply chain, to vessel loading. This collective effort has taken more than two years. During that time exports to Peru continued and farmers received the economic benefits of a large market. This past summer Peru rescinded the proposed phytosanitary requirements. This high-value market remains secure for Canada, which is a significant suc- cess story. Peru,weedseedsandthepower of co-operation How did we achieve this success? First, the Canadian industry held a united position. This was despite suggestions we move away from our position and accept concessions such as tolerances for these weed seeds. The second key reason for success was the common message delivered by government and industry. A united Canadian message would not have been possible without a united industry as its foundation. We have also successfully preserved the Peruvian market because Cereals Cana- da actively reached out to that country’s industry. This has resulted in post-import mitigation measures that have allowed Peruvian regulators to move away from their original position. This illustrates how government and industry can and should work together to keep export markets open. Delivered by many voices, a unified message from agriculture has enormous political power. Unity has kept a key market open, some- thing that would not have occurred with industry division. A unified position does not always exist. When governments in Canada receive conflicting policy positions from different parts of the value chain, they can choose any option that brings the most political gain and still claim industry support. Often the politically expedient course of action is not the best outcome for the industry. Working together as a cohesive unit delivers tangible results for farmers and every link in the value chain. Brenna Mahoney is Cereals Canada director of communications and stakeholder relations.