The US said Friday it had decided to impose preliminary anti-dumping duties on Canadian wheat imports, unleashing an angry reaction from Canada.
Preliminary duties of 8.15 percent on durum wheat and 6.12 percent on hard red spring wheat would be imposed now, the US Commerce Department said. The duties may be returned if the initial decision is not upheld.
"The department has preliminarily found that imports of certain durum and hard red spring wheat were sold at less than fair value," it said in a statement.
Dumping occurs when a product is sold in foreign country for less than it costs to make, or for less than it is sold for in the home market of the producer.
"Western Canadian farmers do not dump their grain into the US market or anywhere else," said Canadian Wheat Board chairman and farmer-elected director Ken Ritter.
"We don't need to. We produce some of the world's highest quality grain, for which our American customers have testified they are willing to pay a premium," he said.
In Ottawa, Canadian International Trade Minister Pierre Pettigrew issued a statement rejecting the US complaint.
"North American prices are determined by North Americans supplies, not alleged Canadian dumping," said Pettigrew.
"We reject in no uncertain terms the notion that Canadian wheat is responsible for low prices in the US."
It was the second duty to be slapped on Canadian wheat by the US, following a March 4 decision to impose a preliminary "countervailing duty" of 3.94 percent on the same wheat products.
Countervailing duties are placed on imports when their production is judged to have been unfairly subsidized in the home market.
Both the anti-dumping and countervailing duties were imposed in response to a complaint filed by North Dakota farmers.
A final US ruling on the antidumping and countervailing duties on the Canadian wheat is due July 15.
In December, the US said it was filing a complaint with the WTO alleging "monopolistic" practices by the Canadian Wheat Board that harmed US exporters.
The Canadian government this week said it would defend its wheat policies at the WTO, arguing that the WTO gives countries the right to have state trading enterprises such as the Canadian Wheat Board.
US farmers say the Canadian Wheat Board receives government support, which means the wheat farmers are being indirectly subsidized in contravention of WTO rules.