By DALE WETZEL
Associated Press Writer
BISMARCK, N.D. - Steep American tariffs on Canadian wheat imports to this country may be unjustified, a trade panel ruled, saying a U.S. trade agency must provide stronger evidence that Canadian sales practices depressed U.S. wheat prices.
The panel, which reviews disputes under the North American Free Trade Agreement, has directed the U.S. International Trade Commission to supply more information to back up its earlier decision to support the tariffs. The commission has three months to do so.
Ken Ritter, chairman of the Canadian Wheat Board, on Tuesday called the panel's decision a ''clear and unequivocal victory'' for Canadian wheat farmers.
''We have taken a huge step towards getting an unjustified tariff removed, a tariff that was imposed two years ago on very shaky grounds, and should have never been there in the first place,'' Ritter said.
Jim Peterson, marketing director for the North Dakota Wheat Commission, said he believes the ITC can address the trade panel's questions. An ITC spokeswoman could not be reached immediately for comment on Tuesday.
''They are some very pressing questions, but they're not insurmountable,'' Peterson said. ''There's still a lot of fight in our side, to address these issues, and I feel comfortable that we'll address them.''
The American tariffs on Canadian hard red spring wheat, which were first imposed in March 2003 and made final the following October, have virtually shut off imports of the wheat variety to the United States. Hard red spring wheat is used to make bread, rolls and other baked goods.
Ritter and the Wheat Board's president, Adrian Measner, said they were confident the 14.15 percent tariff on Canadian hard red spring wheat exports would be lifted. Peterson said the tariff equals about 50 cents a bushel.
The Wheat Commission and the U.S. Durum Growers Association filed trade complaints in September 2002, seeking tariffs against Canadian imports of hard red spring wheat and durum.
The wheat groups argued the Canadian Wheat Board was unfairly benefiting from government subsidies, and using its monopoly power to sell wheat below cost in export markets. The Wheat Board controls wheat and barley sales from Canada's western prairie provinces.
U.S. trade agencies later supported import tariffs for Canadian hard red spring wheat, but declined to support penalties for durum, which is used to make pasta. The Wheat Board, the Canadian federal government and the provincial governments of Saskatchewan and Alberta appealed to the NAFTA panel.
The panel on Tuesday ordered the International Trade Commission to reconsider its earlier ruling. Its earlier conclusion that the Canadian Wheat Board's sales practices had driven down hard red spring wheat prices ''is not supported by substantial evidence,'' the NAFTA panel's report says.
Peterson said the ITC is likely to respond by early September. The duties imposed in 2003 reduced Canadian imports, which ranged as high as 49 million bushels annually, to a trickle. Peterson said it did not make sense to argue that the imports did not affect U.S. wheat prices.