CSCA Declares Force Majeure on Canary Seed Exports to Mexico
WINNIPEG, Aug. 23 /CNW/ - The Board of the Canadian Special Crops Association (CSCA) has declared Force Majeure on canary seed exports destined for Mexico as a result of the establishment of zero tolerance on weed seeds of quarantine concern in canary seed shipments from Canada. Canadian canary seed shipments destined for Mexico have been disrupted since late June, when Mexico implemented a "hold and test" policy for canary seed shipments from Canada and indicated any shipments found to contain quarantine weed seeds would be rejected. Wild buckwheat and stinkweed are found in Canada and are two weeds on Mexico's list of quarantine weeds.
Mexico's import requirements for Canadian canary seed were changed without the standard 60-day advance notice of a change in import policy and a long term solution has not yet been reached that would allow trade to proceed in a predictable manner. The CSCA is imposing Force Majeure as cited in clause 48(1) of the CSCA trade rules (attached as a backgrounder). The time for execution of contracts of Canadian canary seed destined for Mexico entered into on or before August 19, 2010 and traded under CSCA trade rules will be extended until the Board determines the effect of this event no longer exists.
The CSCA has worked with the Canadian Food Inspection Agency (CFIA), canary seed exporters, Mexican importers and the Canadian government in an attempt to resolve this issue. The backlog of canary seed shipments at the border has been addressed however it is not clear how future shipments will be handled to the satisfaction of Mexican authorities, Mexican importers and Canadian exporters.
"We are continuing to explore the opportunities to resolve this issue with the Mexican industry and government officials. We need to have a trade environment and import requirements that will be workable for all parties, recognizing the relative risk of weed seeds being found in canary seed shipments" said Gordon Bacon, CEO of the Canadian Special Crops Association.
Canada is Mexico's largest supplier of canary seed. Exports of Canadian canary seed to Mexico averaged more than 42,000 tonnes and $25 million per year over the last three years.
The Canadian Special Crops Association (CSCA) is the national industry association representing processors and exporters of special crops in Canada. Canadian special crops include pulses - beans, peas, lentils and chickpeas - as well as buckwheat, sunflower seed, mustard seed and canary seed.
BACKGROUND
CSCA Trade Rules
----------------
"48 (1) Force Majeure
Extremely Unusual Events which affect all members of the industry on an
equal basis and preclude the execution of contracts due to reasons beyond
the control of the parties, excluding any event related to the actual
production of the crops covered by these rules may be deemed to be an
event that will allow extra time for the execution of the contracts. An
example of this type of event would be a general strike by both railways
which precludes the movement of product which was moving or normally
moved by rail. If such an event shall be deemed to have arisen, the Board
of Directors shall vote on the matter and upon a majority agreeing that
the event is an Extremely Unusual Event, issue instructions to the trade
that such an event has occurred and the time for execution of contracts
falling within the time this event continues to exist shall be extended
by the number of days until the board determines by majority vote that
the effect of the Event no longer exists.
This clause is not to be invoked to cover minor disruptions or delays,
which normally occur in the industry, affect only selected members of the
industry or are expected to last less than 72 hours."
WINNIPEG, Aug. 23 /CNW/ - The Board of the Canadian Special Crops Association (CSCA) has declared Force Majeure on canary seed exports destined for Mexico as a result of the establishment of zero tolerance on weed seeds of quarantine concern in canary seed shipments from Canada. Canadian canary seed shipments destined for Mexico have been disrupted since late June, when Mexico implemented a "hold and test" policy for canary seed shipments from Canada and indicated any shipments found to contain quarantine weed seeds would be rejected. Wild buckwheat and stinkweed are found in Canada and are two weeds on Mexico's list of quarantine weeds.
Mexico's import requirements for Canadian canary seed were changed without the standard 60-day advance notice of a change in import policy and a long term solution has not yet been reached that would allow trade to proceed in a predictable manner. The CSCA is imposing Force Majeure as cited in clause 48(1) of the CSCA trade rules (attached as a backgrounder). The time for execution of contracts of Canadian canary seed destined for Mexico entered into on or before August 19, 2010 and traded under CSCA trade rules will be extended until the Board determines the effect of this event no longer exists.
The CSCA has worked with the Canadian Food Inspection Agency (CFIA), canary seed exporters, Mexican importers and the Canadian government in an attempt to resolve this issue. The backlog of canary seed shipments at the border has been addressed however it is not clear how future shipments will be handled to the satisfaction of Mexican authorities, Mexican importers and Canadian exporters.
"We are continuing to explore the opportunities to resolve this issue with the Mexican industry and government officials. We need to have a trade environment and import requirements that will be workable for all parties, recognizing the relative risk of weed seeds being found in canary seed shipments" said Gordon Bacon, CEO of the Canadian Special Crops Association.
Canada is Mexico's largest supplier of canary seed. Exports of Canadian canary seed to Mexico averaged more than 42,000 tonnes and $25 million per year over the last three years.
The Canadian Special Crops Association (CSCA) is the national industry association representing processors and exporters of special crops in Canada. Canadian special crops include pulses - beans, peas, lentils and chickpeas - as well as buckwheat, sunflower seed, mustard seed and canary seed.
BACKGROUND
CSCA Trade Rules
----------------
"48 (1) Force Majeure
Extremely Unusual Events which affect all members of the industry on an
equal basis and preclude the execution of contracts due to reasons beyond
the control of the parties, excluding any event related to the actual
production of the crops covered by these rules may be deemed to be an
event that will allow extra time for the execution of the contracts. An
example of this type of event would be a general strike by both railways
which precludes the movement of product which was moving or normally
moved by rail. If such an event shall be deemed to have arisen, the Board
of Directors shall vote on the matter and upon a majority agreeing that
the event is an Extremely Unusual Event, issue instructions to the trade
that such an event has occurred and the time for execution of contracts
falling within the time this event continues to exist shall be extended
by the number of days until the board determines by majority vote that
the effect of the Event no longer exists.
This clause is not to be invoked to cover minor disruptions or delays,
which normally occur in the industry, affect only selected members of the
industry or are expected to last less than 72 hours."