U.S. Muscles In On Iraq Food Imports Via Humanitarian Aid

by Sonny Inbaraj

Australian wheat producers claim the United States is trying to use humanitarian aid to muscle in on Australia's $449 million market share in Iraq.

Washington announced last week it planned to send 600,000 tons of wheat to Iraq as food aid as it began a military invasion to oust Iraqi leader Saddam Hussein.

The Department of Agriculture said it was releasing the first portions of some 200,000 tons of wheat, some of which will be exchanged on markets for rice. Another 400,000 tons would be "made available as needed" from the Emerson Trust, an emergency reserve administered by the agriculture secretary.

But the Australian Wheat Board (AWB), representing the country's wheat farmers, says it is unfair on the part of their U.S. competitor, U.S. Wheat Associates, to try to steal market share during a war.

"Unfortunately as we have experienced in the past, U.S. food aid is being used to disrupt normal commercial markets," said AWB's managing director Andrew Lindberg.

"Obviously we have no problem at all with genuine food aid. But I think we have to draw the line that once those humanitarian issues have been dealt with, then we believe it's appropriate that business gets back to business on normal commercial terms," added Lindberg.

In response, U.S. Wheat Associates president Alan Tracy said that comments criticising U.S. moves to send wheat as food aid to Iraq were unfortunate.

"It's inaccurate, it's been repeated and it's a presumption of a kind of commercial greed in the face of a much more serious humanitarian and military issue that our countries are facing together," Tracy told ABC Radio.

Australia is the third country along with the United States and Britain that has troops in the Gulf. Canberra has 2,000 personnel in the Gulf joining over 300,000 U.S. and British soldiers, 1,000 combat aircraft and five aircraft carrier battle groups.

Australia exports about two million tons of wheat a year, worth about $449 million, to Iraq under the UN oil-for-food program, making it Australia's biggest single market for the grain.

In the oil-for-food program, the AWB negotiates wheat delivery contracts with the Iraqi Grain Board and approvals are given through the United Nations. Payment is made by the Iraqis upon certification of delivery in the Iraqi market.

But last week, just a day before the bombs began raining down on Baghdad, UN Secretary-General Kofi Annan suspended the oil-for-food program and withdrew all UN staff from Iraq.

The question now is -- with a change of regime in Iraq possible, can Australia's special relationship with Iraq continue?

"The Iraqi people really appreciate the quality of Australian wheat. We've been working very closely with our government and the United Nations to ensure our market is protected in any event. And we would certainly expect that the assurances that we have been given are honoured," said Michael Long, AWB's international development and marketing manager.

Added Long: "We do anticipate that the UN oil-for-food programme will continue in one form or another and we really are in the best position to deliver that wheat to the Iraqi people."

Australian Foreign Minister Alexander Downer said the AWB had been the major supplier of wheat under the oil-for-food program and the government is working to secure its speedy resumption "as soon as circumstances on the ground permit."

Last July, Iraq threatened to ban all of its two million tons' wheat purchase from Australia because of Canberra's strong support for Washington's first-strike policy on Baghdad.

Iraq's charge d'affaires Dr Saad al-Samarai accused the Howard government of using "iron language" against Iraqi President Saddam Hussein.

"It is iron language that we hear from Australia. It is like Australia has a case against Iraq. It is like Iraq is preparing to attack Australia," he told reporters last year when announcing the cancellation.

On Sunday, Dr. Al-Samarai left Australia after being ordered out by Canberra with the closure of the Iraqi diplomatic mission.

But for the AWB's Michael Long, Iraqis will always be special. "I've had several trips to Iraq and I must say they are very highly intelligent, very friendly and welcoming people," he told IPS.

"The feedback from our friends in Iraq is that they respect the people of Australia, they respect Australian farmers and they respect the Australian Wheat Board, but they certainly don't respect the position of the Australian government in the coalition."

When Australia's wheat sales were threatened last July, Long said he went to Baghdad.

"Through our extensive efforts, in Baghdad, we convinced them that it's the farmers that are suffering and not the government. Then the Iraqi trade minister Mohammed Mahdi Saleh decided to reinstate the two-million tonne trade -- out of respect for the Australian farmers and the Australian people," said Long.

"Sitting here and looking at the news and seeing the bombs falling on Baghdad leaves an empty feeling in my stomach. Some of my Iraqi friends are suffering in a massive way at the moment," he added.

Farmers in Western Australia, however, have threatened to sue the government for millions of dollars in compensation for lost wheat trade with Iraq.

The Western Australian Farmers Federation president Colin Nichol said farmers in the state will be hit hard because of their high contribution to Australia's export quotas. "If we were to sell the grain in other markets for say two-thirds of the price, or three-quarters of the price, we will take heavy losses," he said.

Added Nichol: "We are happy to trade with Iraq because there are millions of innocent people there who need food."