Canadian Wheat Board

[calculoso]

Figured that I would start a new thread, so that the old one wasn't hijacked...

CWB = Canadian Wheat Board

Originally Posted by Slava

I don't want to turn this into a wheat board argument thread, but I would say its a little more than "perceived public pressure". The case went all the way to the Supreme Court for judgment...

Originally Posted by calculoso

And the Supreme Court said that Cabinet cannot make the decision.

They didn't say anything about whether the monopoly was justified or not.

Originally Posted by Slava

Putting all partisanship aside, no one could determine whether the monopoly is justified...its a matter of opinion.

That is correct. A matter of opinion. I don't get where the resistance to a Dual Market system comes from.

A history:
http://www.cbc.ca/news/background/agriculture/cwb.html

"Some farmers say the board has outlived its usefulness, that selling grain through one government agency - the "single desk," they call it - no longer works.

Defenders of the CWB say that without it the price of grain would fluctuate day-to-day and farmers themselves would have to negotiate their own price."

"In 1997, a referendum of barley producers found that nearly 63 per cent of the farmers support retaining the CWB's monopoly. Critics of the referendum, however, pointed out that the dual market system wasn't an option on the referendum.

In a plebiscite of Alberta farmers in 1996, 66 per cent were in favour of the dual market system."

Now, there's criticism that this last plebiscite was skewed because the Dual Market System was on the ballot.

Guess they can't win either way.

If there are higher prices out there than farmers can get with the CWB, why should they be held back? If nothing else, it should mean that the CWB would fight for higher prices than farmers are currently getting. If most farmers don't want to do the extra work to find higher prices and want to stay with the CWB, then the CWB would keep their market share/supply of grain and have very little impact.

Where's the down side?

[flamefan74]

Originally Posted by calculoso

If there are higher prices out there than farmers can get with the CWB, why should they be held back? If nothing else, it should mean that the CWB would fight for higher prices than farmers are currently getting. If most farmers don't want to do the extra work to find higher prices and want to stay with the CWB, then the CWB would keep their market share/supply of grain and have very little impact.

Where's the down side?

Exactly, there is no downside. Other than some board members with cushy jobs and good pay.

A perfect example would be before the court decision, maltsters thought that we would have a dual market. They were signing up contracts with farmers for malt barley for around $4.50-$4.75 per bushel. After the court decision, malt barley payment now comes from the malt barley pool which is at $4.25 per bushel. So the CWB is paying $.25-$.50 per bushel less to the farmer than what the farmer could have gotten on his own. The CWB touts their price pooling as the way to get the best price. However, it turns out to be less than what farmers can get on their own.

There are lots of horror stories out there about the price the CWB receives for their sales of wheat and barley. However, due to the fact that they have a closed book policy and are not required to show anyone what they get for the sales they make, it is hard to prove. The only way is to look at the price they pay the farmers and the prices on the world market. So much for showing transparency to the farmers who supposedly control this organization.

[Bobblehead]

I'm by no means up on the whole issue, but I thought a major part of the issue was shipping costs.

The farmers in more resolute areas need the CWB to offset their shipping costs, but that penalizes other farmers closer to the border.

I also think this is a very regional issue. It appears Alberta is opposed to the CWB, while Manitoba is very supportive of the CWB.

Personally, I think it is time to phase out the CWB. Perhaps break it into regional authorities, then allow those regions to decide if they will continue the systems in place or totally phase it out for their region.

If commodity prices continue to rise, new markets such a bio-fuels and stuff continue, it should be much more possible for farmers to prosper without the CWB safety net.

[Resolute 14]

The problem with the CWB is as follows.

1. Western Canadian farmers are confined to the monoply.
2. Eastern Canadian farmers are not.

Simple discrimination based on geography.

[Ford Prefect]

Okay, I've got some dumb questions about the CWB. If I understand things correctly, not all grains are handled by the Wheat Board. Some commodities, like Canola I believe, are marketed outside of the CWB. If that's true, why can't all commodities be marketed outside the CWB? And aren't the prices generally higher for commodities that are marketed outside the CWB, suggesting that the fear of prices being lower if the CWB is abolished are unfounded? Forgive me if I'm missing some obvious and salient details ... I'm not an expert on this topic at all.

[MarchHare]

I'm by no means an expert on this issue (there's not much talk of the Wheat Board where I grew up), but the Wheat Board sounds more like the Wheat Soviet to me.

I'm usually left-leaning on most issues, but this is one where I say the free market should dictate the law.

[Slava]

I am also not an expert on the wheat board, but my understanding of the system is that losing the wheat board would be good for the huge farms and those close to the US boarder. For the smaller farms and those far from the boarder however this is not a level playing field.

I remember watching a show on this where one farmer said "what do i know about marketing grain to China?". Which made sense to me. The Wheat Board has some function. It strikes me as a situation where people want the best of both worlds; guarantees when the grain is not in demand and the right to hit the open market when it is.

[FireFly]

Originally Posted by Slava

It strikes me as a situation where people want the best of both worlds; guarantees when the grain is not in demand and the right to hit the open market when it is.

This is how it sits with me as well. As a conservative, I'm all for abolishing the wheat board with the understanding that when prices go down, people can't come to the government for a handout and say "but we feed the world!"

[Resolute 14]

Abolishment of the CWB isn't necessary. Abolishment of the monopoly is. One does not follow the other. The Wheat Board serves a useful function, and would continue to do so even if Western farmers were given their right to sell their product as they so choose.

[Rockin' Flames]

Originally Posted by Snakeeye

Abolishment of the CWB isn't necessary. Abolishment of the monopoly is. One does not follow the other. The Wheat Board serves a useful function, and would continue to do so even if Western farmers were given their right to sell their product as they so choose.

I agree with this. I don't understand why giving farmers the option of who they will sell their products to means the end of the wheat board. The wheat board is simply using scare tactics because it means they will lose some farmers who chose to sell outside the CWB. I also have an issue with the fact that this only farmers from the west have to sell to the wheat board but farmers from Ontario east don't. The entire thing is just rediculous.

[burn_baby_burn]

Name another business where the producer takes all the risk, (weather, insects, disease, increased costs) yet has no say on who they can sell the products they produce to? That isn't even socialism, because in a socialist world the state would own the land and be taking the risk instead of the private land owner.

Right now farmers across western Canada grow numerous crops that are not regulated by the Wheat Board. Look at all the yellow fields in July. How come practically every farmer can manage to sell their Canola without the Wheat Board? But when it comes to wheat or barley it is an issue?

I heard of farmers who had malt barley contracted for more than $5.00 per bushell before the court ruling 2 weeks ago. (subject to a Friends of the Wheat Board lose) Now they are being offered a $1 less. Coincidence? Why can't the Friends of the Wheat Board see this?

[mykalberta]

If a vote was taken by all farmers based on land owned, there would be no problem getting it through.

The problem comes with the old farmer who owns 700 acres and still thinks that is enough to have a good living off and he wants to give it to his son.

Once they die off, the opposition will be non existent.

I have been involved with 3 different trips across the border to get on avreage an extra 3$/bushell of wheat and that was when the dollar wasnt near as good as it is today.

The CWB is an antiquated machine built for a time when you had a plethora of farmers owning a few hundred acres. At that time it was needed, but the economics of farming has changed and so should the CWB.

MYK

[Slava]

Originally Posted by mykalberta

If a vote was taken by all farmers based on land owned, there would be no problem getting it through.

The problem comes with the old farmer who owns 700 acres and still thinks that is enough to have a good living off and he wants to give it to his son.

Once they die off, the opposition will be non existent.

I have been involved with 3 different trips across the border to get on avreage an extra 3$/bushell of wheat and that was when the dollar wasnt near as good as it is today.

The CWB is an antiquated machine built for a time when you had a plethora of farmers owning a few hundred acres. At that time it was needed, but the economics of farming has changed and so should the CWB.

MYK

You have more experience than me and might be right. The sad truth is that the family farm as its been known since the dawn of our country is all but gone. That is due in large part to the evaporation of institutions and programs such as the wheat board that level the playing field.

I agree that you might get more money moving your grain across the line, but there is a break even there? Surely its not as cost effective the farther north you go (increased costs due to having to truck the grain an extra few hundred miles, etc.)

[Berger_4_]

i don't think they should get rid of it. unless farmers actually unite or whatever, prices will decrease dramatically...i think it should be a split system...you can choose to sell your wheat through the board for a guaranteed price, or take a risk and try and market it on your own

[burn_baby_burn]

Originally Posted by Slava

You have more experience than me and might be right. The sad truth is that the family farm as its been known since the dawn of our country is all but gone. That is due in large part to the evaporation of institutions and programs such as the wheat board that level the playing field.

I agree that you might get more money moving your grain across the line, but there is a break even there? Surely its not as cost effective the farther north you go (increased costs due to having to truck the grain an extra few hundred miles, etc.)

What about Canola? Farmers don't have a problem growing and marketing it. Why the problem with Wheat and Barley? Farmers that live in BC or East of Manitoba don't seem to have a problem marketing their crops.

[flamefan74]

Originally Posted by Berger_4_

i don't think they should get rid of it. unless farmers actually unite or whatever, prices will decrease dramatically...i think it should be a split system...you can choose to sell your wheat through the board for a guaranteed price, or take a risk and try and market it on your own

How do you know prices will decrease dramatically? CWB prices are already lower than world prices. Look at the prices that farmers are getting for canola and compare that to soybeans which is what sets the prices for oilseeds. You will see that canola prices have actually outpaced soybeans in price growth. If farmers can market canola, peas, and oats without the CWB's help, why should wheat and barley be any different? I think the only time you will see a dramatic price decrease for for farmers is if the world price drops.

[burn_baby_burn]

^^ Exactly! How much did the barley price drop after the Friends of the Wheat Board Supreme Court win? 70 cents a bushell the first day. Plus contracts for more than $5.00 a bushel for Malt dropped to the good old Wheat Board price of $1 less per bushel.

To put that into perspective for the people that don't have a clue about agriculture. Barley around Red Deer can yield up to 100 to 125+ bushel's per acre. There are 160 acres in a quarter (half mile by half mile). So a lose of a dollar a bushel could mean a missed profit of $16,000 to $20,000 per quarter of Barley harvested.

How is that loss of income benificial to the farmer?

[jolinar of malkshor]

The first post shows some people saying that the supreme court decided that parliament cannot make changes to the regulations. I am pretty sure it was not the supreme court that made the decision but a federal court judge.

Am I wrong?

[calculoso]

Originally Posted by jolinar of malkshor

The first post shows some people saying that the supreme court decided that parliament cannot make changes to the regulations. I am pretty sure it was not the supreme court that made the decision but a federal court judge.

Am I wrong?

Definitely wrong on 1 count, could be correct on the other.

Although I've seen both Supreme Court and Federal Court in many places, the NDP seem to think it was a Supreme Court Judge
http://www.ndp.ca/page/5562/print

and CTV said it was a Federal Court judge
http://www.ctv.ca/servlet/ArticleNew...0805/20070805/

Either way, it was a fairly major decision.

In addition, the judge never said anything about Parliament not being able to make a decision, but that Cabinet could not.

[fredr123]

Originally Posted by jolinar of malkshor

The first post shows some people saying that the supreme court decided that parliament cannot make changes to the regulations. I am pretty sure it was not the supreme court that made the decision but a federal court judge.

Am I wrong?

The Canadian Wheat Board v. Canada (Attorney General of Canada), 2007 FC 807.

A decision of the Federal Court of Canada released July 31, 2007. Amendments to section 9 of the Canadian Wheat Board regulations made by Order in Council by the Governor in Council removing barley and barley products from the marketing authority of the Canadian Wheat Board was found to be ultra vires and of no force and effect.