Change in funding prompts new look at grain promotion body

The Canadian International Grains Institute is getting a facelift and a new source of funding.

The iconic institution had been receiving its core funding from the Western Canadian Deduction, but that checkoff expires July 31.

The deduction was designed to help CIGI transition from being funded by the Canadian Wheat Board to life in the open market.

It was comprised of levies paid by wheat and barley growers. CIGI received 15 cents per tonne of the 48 cents per tonne wheat checkoff.

It amounted to about $3 million in annual funding.

The prairie wheat commissions have absorbed some or all of the Western Canadian Deduction in their provincial checkoffs and have agreed to fund CIGI at the rate of $1.9 million per year for the next two years.

All of the major grain companies with the exception of Louis Dreyfus Canada have agreed to match that for total annual funding of $3.8 million.

In exchange, CIGI will have a new 10-member board of directors comprising five representatives from the commissions and five from the grain companies.

Bill Gehl, chair of the Saskatchewan Wheat Development Commission, said continuing to fund CIGI was not an easy decision.

“This hasn’t been just a slam dunk,” he said.

“There has been lots of soul searching, certainly from Sask Wheat’s perspective.”

He said there is bound to be some changes in CIGI’s strategic plan moving forward, including a renewal in the organization’s commitment to wheat and wheat farmers.

“In the wake of the demise of the wheat board, CIGI was set out to sea and was rather rudderless,” he said.

It was a much easier decision for the Alberta Wheat Commission.

“We’re well aware of the benefits that CIGI has provided over the years and we’re fully supportive of the work that they do and want to see that work continue,” said commission vice-chair Kevin Bender, who is also the newly elected chair of CIGI.

“You see the expertise they have on staff and how that is translated into education for our customers around the world.”

JoAnne Buth, CIGI’s chief executive officer, said other sources of revenue include about $3 million in annual federal government funding, fee-for-service work on behalf of private companies such as Warburtons and a large project in Morocco for Global Affairs Canada.

She said the government funding runs out next year, and CIGI will have to reapply under the new policy framework, which is why it is nice to have the two-year commitment in place from the grain companies and commissions.

“There is still some unknowns, but this provides us with much more stability than we have had,” said Buth.

She doesn’t foresee any changes to the mandate, which is to provide technical support to end users of Canadian grains. CIGI will continue to teach customers about quality and functionality, how grain performs in various products and how to mill it.

Buth is pleased with the increased grain company input at the board level because these firms deal directly with customers and know what kind of assistance they need.

Jean-Marc Ruest, senior vice-president of corporate affairs with Richardson International, said grain companies always had the sense CIGI did good work promoting wheat and durum during the CWB era.

“Now that we’re actively involved in the marketing of those commodities, we see it as kind of an advantage that other competing jurisdictions don’t have,” he said.

“We’re happy to be involved in plotting the direction of the institution going forward. It has done some great work in the past and we look forward to the great things it will do in the future.”

Ruest likes the makeup of the board because producers and grain companies have equal representation.

“This only works if we’re all in it together,” he said.

Gehl said the strategic plan that emerges over the next two years will be critical in determining whether there will be continued investment from Sask Wheat.

“Moving forward we’re going to have to feel comfortable that this is a good expenditure of farmers’ money,” he said.

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