BILLIONS AT STAKE
The inability to export this record crop is having a profound impact on farm grain prices across the Prairies.
With West Coast No. 1 wheat prices close to $11 per bushel and cash prices in Saskatchewan at $5.25 per bu., farmers are currently paying $160 per tonne beyond normal freight and handling costs to export their crop.
With record high crush margins, canola producers are facing similar increases in the basis between their cash price and what it is worth on international markets.
These record high basis levels are costing farmers $100 to $200 per acre in foregone revenue and several billion dollars in total.
At the same time, these margins have substantially increased the bottom line of grain companies and processors.
The federal government is now taking action to increase rail grain movement with new legislation. Even if rail movement is increased by this legislation, a new crop harvest is only six months away.
With the large impending carryover, Agriculture Canada is forecasting that grain stocks remain high for the next crop year as well, meaning at least another year of high basis levels.
While increased rail movement is critical, it is only part of the solution. West coast grain handling capacity is currently limited to about 20 million tonnes, and this capacity is tightly controlled by three privately owned grain companies, who will likely post record profits this year.
With projected grain export demand of 36 to 40 million tonnes, most of the additional rail movement will be used to send more shipments east and south.
However, the basis will remain high as these are long and costly routes to salt water and a very long way to the large Asian markets.
If governments are going to address high basis levels over the long term, and increase the bottom line for grain producers, they need to also consider how to significantly increase the west coast export capacity because this remains a critical bottleneck for grain exports. Billions of dollars are at stake.
Richard Gray, professor
University of Sask.,
ALL THINGS CONSIDERED
Re: New pig code requires group housing in all new barns (WP, March 13)
Pig producers are making great strides in bringing their industry up to par with other livestock industries when it comes to advancements in housing.
The commitment to phase out restrictive sow gestation stalls in favour of group housing is but one step. When making this change, producers are strongly encouraged to consider pig comfort and manure management as part of the equation.
Provision of bedding has a positive effect on improving foot and leg health and reducing lameness rates, something well documented in dairy industry research.
Existing slatted flooring does not allow for the use of bedding, but flooring changes are possible with new constructions, something the hog industry is considering anyway given that most existing barns are nearing their expiration date.
Furthermore, the addition of bedding to manure shifts its makeup to a value-added compostable product worth considering given the high costs of trucking liquid slurry and manure separation technologies.
Brandy R. Street,
PROVINCIAL TRADE PROPOSAL
The citizens of Alberta would like to propose a trade with the province of Saskatchewan. We will send to you our ex-premier, Alison Redford, Wild Rose leader Danielle Smith, NDP leader Brian Mason and Liberal leader Raj Pannu in exchange for your premier, Brad Wall.
We would consider throwing in Rider-Eskimo game tickets in Edmonton.
Please respond to confirm trade as soon as possible.
This letter is in response to Ms. Dunlop’s letter to the editor, Farm worker safety (March 13). The tone and content of her letter has lost any support she may have had from me.
Having been a safety co-ordinator in the past, I know too well the dangers involved with the work farmers do daily.
They work with machinery and large equipment regularly, often under time pressure and alone. I fully support accident investigations to help make farming as safe as possible for all our owner-operators and their employees.
Where she lost me was when she capitalized on a tragedy to promote her cause.
Her lack of compassion or respect for the owner-operators of this farm is hypocritical. She says she is disgusted that so few people care about the worker, yet she shows she cares nothing about the family who lost their co-worker and friend. She found quotes about what a good man the victim was but didn’t spend a second looking into the family he worked for.
This is a wonderful, thoughtful and caring family who hired a friend to work alongside them.
She took no time to mention what kind of operation the farm was because an accident on a careful farm doesn’t promote her cause like a faceless operation who hired some farm worker.
Some compassion towards the owners and acknowledgement that they did their best to provide a safe environment would have benefited her cause.
I am insulted that she claims the accident was “inevitable … predictable and very preventable.” I live with someone who survived an identical accident to this one — his was investigated — and it was none of these things.
Accidents and deaths still occur in workplaces with unions and safe work procedures. Safety programs reduce risk; they don’t eliminate it. Don’t assume it’s all callous negligence.
Jamie Van Cleemput,
In the March 13 issue of The Western Producer on page 52, the photograph captures the grain movement problem in a nut shell. The picture shows 11 grain hopper cars and then oil tanker cars as far back as an eye can see.
The oil has to get to market too, but the railways are so busy hauling oil they forget about the lowly farmers.
We are a captive market; we don’t have any pipeline the wheat can go in. I wish someone would organize a convoy of super Bs. That would take some of it away.
The grain companies are doing the farmers a real disservice as they have booked ships at port and now they can’t get the grain there. …
The Saskatchewan Wheat Pool and the Canadian Wheat Board were organized because grain companies were doing the same thing back in the ’30s and ’40s.
My grandfather and another fellow drove around and got people to sign up for the SWP. There were other good honest men, and Jack Wesson made it happen. They had a good organization that treated the farmers fairly and it ran until the suits got in there and wrecked it.
There is no shortage of markets. If the wheat was at the West Coast, it would all move at a good price. Our customers who are buying our wheat are still paying in the plus $6 range and the futures market in Minnesota is in the $7 a bushel range. The price on the Prairies is half.
I am sure that the grain will eventually all move and these criminal prices will be a thing of the past. As farmers, we need to remember how the grain companies treated us in the past year and be ever on guard so they can’t do it again.
Why should farmers bankroll a bunch of suits’ errors in judgment? We have done it enough.