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EU Drops Durum Tariff

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The European Union has removed a tariff against all high-quality durum wheat imports that had especially jeopardized shipments from Canada, the United States and Mexico, the Canadian Wheat Board said Nov. 5.

The tariff had been in place for about a month, the CWB said.

The EU removed the tariff after the wheat board and others complained about how it calculated the tariff. It amounted to 16.73 euros per tonne, which worked out to about US$25, depending on the day’s currency exchange, CWB market analyst Antoine Coudiere said.

The EU still has tariffs in place on medium-quality and low-quality durum imports, but has now lowered them, he said.

The tariff had hindered sales as CWB customers took a “wait-and-see approach” to the tariff’s impact, the wheat board said.

“During times of low global grain prices, import tariffs become more common,” CWB president and CEO Ian White said. “Although the removal of a tariff into one market is not enough to brighten the overall situation for western Canadian durum producers, it is an important issue.”

The tariff on high-quality durum had jeopardized $200 million worth of Canadian exports.

The EU had calculated its durum tariffs based on the wrong freight rate, the CWB’s Coudiere said. It recalculates its durum tariffs every two weeks.

Worldwide supplies have increased at a time when global trade is expected to drop by six per cent to 6.9 million tonnes, according to the CWB. The board is projecting for this crop year a price of $216 per tonne, down 41 per cent from the projected final return for the same durum last year.

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