A pledge by the Harper government to introduce legislation to end the Canadian Wheat Board's single desk selling responsibilities by the 2012 crop year prompted a quick reaction by both sides of the debate.
The Canadian Wheat Board Alliance (CWBA) contends that the Conservatives have no mandate to end the CWB's single desk for marketing wheat and barley.
“The Conservatives have no mandate from farmers to end the single desk,” stated Bill Gehl, chairperson of the CWBA, “farmers are only two per cent of the population spread over 57 western ridings, and so claiming the Conservative Party has a mandate from farmers to change the Canadian Wheat Board is not credible.”
They argue the CWB director elections have resulted in 80 per cent of the Wheat Board directors' seats to be occupied by farmers who support the single desk. They also point out that Agriculture Minister Gerry Ritz had previously said the Board’s future was up to farmers, but following the federal election he is contradicting his earlier statement by saying he will introduce legislation to remove the single desk.
“The Wheat Board returns better than 98 per cent of sales revenue back to farmers. Without the Board’s single desk, farmers will have to market their crops through the private trade, whose profit margins will lower the returns farmers get from those sales revenues,” Gehl said.
“Every academic study that has had access to the CWB’s books, and several trade inquiries have shown that the Wheat Board increases the farm gate price of grain. It should be obvious to anyone who can run a calculator this is why farmers have consistently supported the Wheat Board’s single desk.”
The Grain Growers of Canada is pleased the federal government has set a firm date of August 1, 2012 for marketing choice in wheat and barley.
“This gives us a year to think through not only what the Canadian Wheat Board will look like, but also how to handle all of the change related issues,” said Stephen Vandervalk, President of the Grain Growers of Canada.
“For example, should there be a new ownership structure? Should it be a co-operative? How will the federal cash advance program be handled? How can we have a smooth transition in research funding check-offs? Should the CWB have access to some Government guaranteed financing for a transition period?”
The Grain Growers, Wheat Growers and Barley Growers wrote to the Minister last week and suggested a process and timeline to get to 2012. The letter is posted at www.ggc-pgc.ca and contains a more thorough list of issues to be addressed.
“The Grain Growers have always wanted the CWB to be a real choice in the open market for the many farmers who wish to market through them and that is why we urged the Government to take some time and manage the change properly,” said Vandervalk. “Farmers, the CWB, grain handlers, millers and malting companies want certainty and clarity above all else.”
The goal of the Grain Growers is to create an open market that provides prairie farmers with the freedom to market their grain on their own to value added processors, grain handlers, or through a competitive Canadian Wheat Board.
The National Farmers Union argues that the farmers will not be better off following Ottawa's legislative elimination of the CWB's single desk powers.
“Ritz is not being honest with farmers. The fact is farmers won’t be better off without the single desk, because the CWB won’t survive without it," stated NFU President Terry Boehm. "This idea of a dual market is a myth. It’s the CWB with its single desk, or no CWB at all."
The NFU says Canadians only need to look at what happened in Australia over the past three years. They highlight that in 2008 the government of Australia removed the single desk of the Australian Wheat Board’s (AWB), and today it no longer exists. After Australia's board was broken up, parts of it were sold off to Agrium and Cargill. The change in Australia happened despite the fact that the AWB possessed considerable assets, in contrast to the CWB which has not been allowed to possess any assets such as grain handling facilities.
“The Harper government continues to argue that farmers will be better off without the CWB. However, they have never produced any financial analysis to demonstrate this. The only academic studies on this have always proven that the CWB brings substantial benefits to farmers through the power of its single desk selling advantage. The fact is, the CWB brings $1.5 billion into farmers pockets every year, money they would not have otherwise,” said Boehm.
“The advantage of the single desk to farmers is no surprise either. Patents work the same way for big corporations. Patents give corporations exclusive selling rights on their products. Why do you think corporations defend their patents so vigorously? It’s the same with OPEC in the oil sector and it’s the same with Canpotex in the Potash sector, a point the Brad Wall government was quick to make in Saskatchewan last fall," Boehm added.
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