Money talks louder than words.

America has played a key role in developing Peru's wheat-milling industry - only to see the South American country opt for cheaper Canadian grain.

And this to make biscuits exported duty-free to the US.

US Wheat Associates, the export development group, has "been instrumental" in helping Peruvian millers develop from hard red winter grain-only concerns to "very sophisticated" operations capable of handling the range of wheat types, Washington's farm attaché in Lima said.

But that didn't stop the US last year losing its place as Peru's preferred wheat supplier, with trade falling 9% to less than 364,000 tonnes despite an overall rise in imports.

"Canadian and Russian wheat were the main reasons for this loss in market share," the attaché, Gaspar Nolte, said noting that the price of these exports considerably undercut the $260.10 a tonne at which America supplied Peru.

Russia's wheat exports to Peru doubled, with Canada's leaping 140%.

Cracker jackpot 

Peru's growing wheat demand, which is expected to continue expanding by 4% a year, reflects in part a fondness for pasta, of which, at 10 kilogrammes a head, Peruvians are South America's second most avid consumers.

However, the country is also developing a biscuit and cracker industry, which exported 24,000 tonnes of product last year.

While nearby Bolivia, Colombia and Ecuador were the main markets, producers are also seeking to exploit US rules allowing duty-free access to Peruvian wheat products.

"Some millers have already begun developing a market for pasta and cookies in the US," Mr Nolte said.

Potato fights back 

Not that millers are going unchallenged.

Peru's potato barons are lobbying Lima to reimpose an import duty on wheat for fear that the grain is being used as a substitute for Peru's most famous native crop, which remains a relatively large concern.

Home-grown wheat "is only a minor cash crop… consumer directly in soups and purees", the report said.

The tuber's lobby appears to have some sympathy from farm ministry officials, who believe up to 30% of wheat flour can be replaced with potato flour.

"However, this effort has not had an overwhelming [sic] reception by bakers who argue that only 10% of wheat flour could be replaced and even this low proportion would be rather expensive due to the preliminary conditioning that these flours require," Mr Nolte said.