Tuesday, January 3, 2012

Government pushes Marketing Freedom for Grain Farmers Act - Judge rules that government broke the law

    Growing grain has had a resurgence on some island farms, but it isn't of the scale that would compare to farms in the Peace River or the prairies. Even though the bread basket of Canada seems far away from the Gulf Islands, and even if you aren't a farmer at all, there are good reasons to pay attention to what is happening beyond our shores.
    Farmers in the prairies and Peace River area who produce barley or wheat for export or human consumption currently must sell and market through the Canadian Wheat Board. When the Conservatives achieved their majority government, they promptly set out to fulfill their election promises, one of which was to remove the single-desk selling authority of the Canadian Wheat Board. Minister Ritz announced that regardless of any farmer vote that would be held, this would occur. The CWB went ahead and conducted a vote of farmers anyways, which resulted in a majority of farmers wanting the single desk retained. This vote was ignored by the government. The Conservative majority pushed through the Marketing Freedom for Grain Farmers Act, intending to repeal the Canadian Wheat Board Act later in 2012. Already they have eliminated all farmer-elected Board members, leaving five government-appointed Board members.
    Who benefits from this? The government would have us believe that farmers want this, but without a properly conducted plebiscite all we have are anecdotal comments on either side; some farmers think we are missing out on opportunities because we are not fulfilling our full potential as a grain producer and major exporter, others think that the CWB has been instrumental in helping Canadian farmers market their grain in way that farmers themselves have demanded, and the CWB farmer vote verifies this support.
    Many economists and industry observers believe that the major multinational agribusiness companies and transporters have the most to gain, and farmers will only see their piece of the pie get smaller. Our system of producing and marketing grain will increasingly resemble the US system – farms will get bigger, more small farms will be absorbed by the big farms, shrinking rural communities. Fifteen to twenty years ago, the multinationals parked themselves in Canada, waiting for the CWB demise and the opportunities to market Canadian grain. I remember Cargill coming to UBC’s Faculty of Agriculture in the early 1980’s to recruit a number of graduates. Who is Cargill?, we asked, since we were far from any grain growing area. The current land-grabbing activities that are occurring worldwide will no doubt accelerate in the prairies with the march of progress.
   That was why the CWB was formed in the first place. Farmers wanted an orderly way to market grain for a fair price so that they could focus on farming. At first the government wasn’t interested, not until the depression, and in 1935 the Canadian Wheat Board was formed as a voluntary marketing agency to help get rid of surplus wheat when the prices were very low. In 1943, the CWB played an important role in supplying grain to our European allies and stopping the domestic inflation of grain prices, and it was given the exclusive right to purchase and sell wheat. After that, the CWB played a vital role in developing our agricultural potential in Canada.
    As markets have modernized, there have been pressures on Canada to dismantle the CWB. Some farmers agree and would prefer an open market to sell to whoever they wish. Many of these farmers are younger, and perhaps feel they are ready to move on from their father and grandfather’s method of marketing. Some farmers would prefer to stay with the CWB as a single-desk seller in these uncertain times, which is especially seen by the majority of farmer-elected board members who support the single-desk selling mandate. The best people to decide are the farmers themselves, and the Canadian Wheat Board Act supports this.
    Federal Court Justice Douglas Campbell agreed, and ruled in December that Minister Ritz overstepped his boundaries by not holding a farmer plebiscite or consulting with the CWB, breaching Section 47.1 of the Canadian Wheat Board Act. Regardless of how you feel about the Wheat Board, or if you don’t care about the Wheat Board at all, you should care about how our elected officials conduct themselves. We expect the lawmakers to follow our country's own laws. They certainly expect us to.
    As this debate has been around for several years the two sides have become increasingly polarized, ignoring the discussion of options that could perhaps be beneficial in the long run. One suggestion has been to retain the single desk CWB for export markets, and allow a free market system domestically or within North America. Some think that the vote should determine if barley should be excluded from the CWB control, as had happened with oats several years ago. Most economists agree that a dual system across the board will result in the demise of the CWB.
    At this point farmers have only uncertainty. Without a smooth transition and with a court ruling against the government, farmers aren’t sure about being ready to have a free market by this summer. Like children of a bad divorce, farmers just want to get on with farming and want to believe the outcome will benefit them. Many who supported the CWB have the added angst of working within a market system they did not choose, and the added uncertainty of a bumpy transition and a government screw up.
    Not a good way to start the New Year. Here’s hoping the economists are wrong, for the farmer’s sake.


  1. Why does it have to be one way or the other though? Why cannot those farmers who want to stay with the wheat board stay with it, and those who want to strike out on their own should be free to do so?

    1. Based on the comments I have read by economists who have studied this issue, it is likely to be inevitable that the CWB will not survive. There would have to be major changes to its structure, fast.

  2. Why does it have to be one way or the other though? Why cannot those farmers who want to stay with the wheat board stay with it, and those who want to strike out on their own should be free to do so?

  3. I guess we will wait and see. I think for now, the idea is that the CWB will do just that.