U.S. Sanctions Urged on Canadian Wheat : Trade: ITC says weak currency, other factors have brought a flood of imports.

The International Trade Commission recommended Monday that the United States slap sanctions on Canadian wheat to stem a surge of imports.

Trade relations between Washington and Ottawa have soured over the wheat dispute. The United States is concerned about a rise in what it says are subsidized wheat imports, especially after floods devastated U.S. crops last year.

The ITC, an independent U.S. trade agency, found the low value of the Canadian dollar, Canadian rail subsidies, marketing practices of the Canadian Wheat Board, surpluses of Canadian feed wheat and high U.S. demand had led to a flood of imports.

The ITC makes recommendations on trade disputes, but its actions are not binding.

Three of the six commissioners called for 10% duties on imports of Canadian wheat above 500,000 metric tons. Two commissioners called for limits above 900,000 tons, and the other commissioner wanted an 800,000-ton quota.

Currently, U.S. duties of 10% kick in only after non-durum Canadian wheat imports surpass 1 million tons. Since the United States rarely imports above that level, duties have largely been absent.

The two commissioners recommending the 900,000-ton ceiling also proposed raising the duty to 35% on non-durum wheat and to 15% for durum and semolina.

The ITC recommendations are not binding, and congressional sources predict that President Clinton will not act on them until at least next week.