Customs officials have ordered ports to stop collecting duties on Canadian wheat imports, ending a lengthy trade war ultimately won by Canadian farmers.

The notification, which came last Friday from Customs headquarters in Washington, D.C., means Western Red Spring wheat can enter the U.S. without any kind of cash deposit or bond for the first time in three years. Canadian Wheat Board spokesperson Maureen Fitzhenry said Prairie farmers should be pleased their persistence has been rewarded.

The U.S. Customs decision follows a ruling last December by a North American Free Trade Agreement panel that rejected an appeal by the North Dakota Wheat Commission.

The commission argued U.S. farmers were harmed by Canadian wheat sales in their country. However, the International Trade Commission rejected the claim in an October ruling, which the NAFTA panel upheld last December.

The ruling was the latest in several decisions by the NAFTA panel and the ITC since the North Dakota commission filed a trade complaint against Canada in 2002, claiming the wheat board sold wheat at below the cost of production to gain market share.

The tariff initially was set at 14.15 per cent, but was lowered in August to 11.2 per cent. Fitzhenry said it's difficult to estimate how much the dispute cost farmers, since prices vary each year according to quality and international market conditions. However, if the tariff had stayed on exports, the wheat board estimates lost sales could have reached about $50 million a year.

The North Dakota commission has said because of the tariffs, Canadian spring wheat exports to the United States dropped from about 45 million bushels annually to just 303,000 bushels in the 2004-05 marketing year.

Marketing director Jim Peterson could not be reached for comment Wednesday. However, he said last December the commission will continue to put pressure on the wheat board through world trade talks and fight its "government monopoly."

The NAFTA ruling was viewed by those on both sides of the dispute as clearing the way for the tariffs to be lifted, but it has taken more than two months for it to take effect. Spring wheat is milled for bakery flour and used in bread and other products.

Fitzhenry said the board likely won't realize any savings until the 2006-07 crop year since most U.S. millers already have their supplies for the year lined up. She expects it won't be hard to increase sales since many millers supported Canada in the dispute, but adds China has become an important market in recent years and could affect how much wheat is sold into the United States.

Source: Canadian Press