95 



Canadians produce more barley, h would seem 

 to follow that the flow of barley into the U.S. 

 would be at least ten times as great as the U.S. 

 shipments into Canada. 



The release of barley from CWB control would 

 affect the same region and many of the same 

 people who are still reeling from the CFTA 

 effects on the durum market. It could well be 

 the final straw for a large number of U.S. 

 producers in an area of the country where family 

 farmers are already experiencing severe 

 hardship. Plummeting prices for another of 

 their major products could cause another round 

 of farm failures. 



American Tax Payers to Subsidize 

 Canadian Barley Exports 



Wilfred Harder, chairman of the Advisory 

 Committee for the Canadian Wheat Board, in a 

 press release dated June 10, 1993, made the 

 following comments in part: "The prospect of a 

 mass southward movement of barley will 

 definitely lower prices and not. ..increase returns 

 to barley producers." 



Mr. Harder aired an even more interesting 

 concern, stating that "CANADIAN BARLEY 

 COULD VERY WELL FIND ITSELF 

 COMPETING WITH BARLEY 

 TRANS-SHIPPED VIA THE U.S. INTO 

 OFFSHORE MARKETS. THERE ARE NO 

 SAFEGUARDS TO PREVENT CANADIAN 

 BARLEY FROM BEING RE-EXPORTED 

 FROM THE U.S., POSSIBLY EVEN UNDER 

 THE EXPORT ENHANCEMENT 

 PROGRAM." 



Harder 's comments give added credence to the 

 importance of Senator Conrad's efforts toward 

 end use certificate legislation. The United States 

 would be in the ridiculous position of using 

 American tax dollars to subsidize the sale of 

 Canadian barley in competition with Canadian 

 barley being sold with the assistance of the CWB. 



Cheaper Barley Would Drive Down 

 Prices of Other Feed Grains 



While the U.S. accounts for 60 percent of the 

 world trade in total feed grains, including corn, 

 barley, oats, and a number of other lesser crops, 

 one must look domestically at the competition 

 among these crops to realize the effect of 

 potentially huge inflows of Canadian barley. 

 The fact is that a flood of Canadian barley would 

 reduce barley prices nationwide, making it much 

 more competitive with corn, thus lowering the 

 price of U.S. com nationwide. 



The result would be increased costs to USDA 

 through greater use of Commodity Credit 

 Corporation (CCC) loans and a higher number 

 of forfeitures of both crops due to prices below 

 the loan rates. Government reaction to this 

 scenario, as indicated from past performances, 

 would be to reduce farm program benefits and 

 put U.S. farmers at greater risk rather than 

 moving to correct the root problem, which is the 

 lopsided trade practices allowed by the CFTA. 



Northern U.S. farmers, who were left as orphans 

 on the doorstep during the CFTA negotiations, 

 would see another of their regional markets 

 destroyed. Farmers across the country would 

 also be victimized as they struggle to compete 

 against Northern U.S. and Canadian barley 

 which would hit the market at Ore sale prices. 



It is not as though the Canadians have not been 

 enjoying access to the American barley market 

 already. Prior to the CFTA, the U.S. imported 

 between 5 and 8 million bushels of Canadian 

 barley annually. Since the CFTA, those 

 numbers have risen to as high as 25 million 

 bushels in 1991-92. The projections for 1992-93 

 are at IS million bushels, due primarily to poor 

 malting barley quality in the current available 

 Canadian stocks. This drop in Canadian exports 

 is a strong incentive for the Canadian 

 agriculture Minister to pursue his goal of 

 opening the barley trade system completely. 



These figures were obtained from a report 

 entitled, "United States Barley Statistics" which 

 was prepared by the North Dakota Barley 

 Council 



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