kjs writes:
I think part of the reason we subsudise the growing of grains is that we as a country don't want to lose the ability to grow our own food.
You have put your finger on exactly the *original* justification for Ag-subsidies.
Not just in the US, but everywhere in the developed world.
Self-sufficiency in food production.
Unfortunately, it has gone way beyond that.
In the industrialized world, we have succeeded so eminently in food production that we are no longer subsidizing production for our *consumers*, but rather for our *producers* so they can chase export markets.
This drives down the price of commodities worldwide and diminishes the ability of subsistence farmers in poor countries (that can't afford subsidies) to get a fair price for their crops.
kjs writes:
What in your opinion makes the Canadian product cheaper?
That's a good question, and not being an economist I am not sure I have the full answer.
The wheat farmers in Montana will tell you that Canadian wheat is more heavily subsidized than theirs is
...but that depends how you define a 'subsidy'.
American wheat has a lot of indirect subsidies too, but a lot of what you mention factors in as well.
A favorable currency exchange rate, probably some lower costs of production, but it would be a very complicated calculation to figure out all the factors and how they add up to the final price.