The 2012-13 crop year will go down in history as a year of massive change and adjustment in the western Canadian grain industry.
Producers, grain companies and other organizations involved in the grain business were all affected by Ottawa’s decision to deregulate western Canadian wheat, durum and malting barley markets, but no organization was more deeply impacted than CWB.
Ward Weisensel, chief operating officer with CWB, said restructuring the board from a single desk agency to a voluntary marketing company was a challenging task.
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Nonetheless, CWB officials are pleased with how the restructured organization performed during the first 12 months.
“It’s been a challenging year with a lot of change, without question … but we think we made the right decisions,” said Weisensel.
“Everybody always wants to do more volume, but we’re comfortable with the volume that we’ve done and based on where we’re sitting right now, we will be profitable.”
Prior to deregulation, CWB officials said the voluntary board could potentially handle 30 to 40 percent of the wheat, durum and malting barley produced during the 2012-13 crop year.
Last week, Weisensel said volumes secured through CWB pools were lower than expected, although the amount of grain secured through cash markets exceeded projections.
“I think, on the whole, we saw less coming into the pools than what we would have anticipated early on and I think that’s a function of the very high prices that we saw,” he said. “We saw those same types of issues in Australia.… When prices are very high, pooling doesn’t do as well.”
Weisensel said CWB has improved its programs for the 2013-14 crop year in hopes of securing greater volumes. It will offer early delivery, annual and winter pools with a futures choice option for all wheat committed to those programs.
“We have a much broader set of programs going into the 2013-14 crop year than what we had at this time going into the 2012-13 crop year,” he said. “We have a lot more options and we think we have a good program offering that should get us more volume.”
Growers are becoming more accustomed to handling agreements that exist between CWB and major line companies. As that familiarity grows, delivery glitches will be less prevalent.
“Generally speaking, I think there was a lot of uncertainty about how all this was going to work, particularly in the fall period of last year, because everything was so new,” he said.
“I think that as people became more accustomed to it, and there was a better understanding of how things were going to work, I think that the experiences became much better.”
One of CWB’s top priorities is to finalize a plan aimed at privatizing the organization.
“We think it’s very important to move much quicker than the time frame laid out in legislation and that’s our objective,” Weisensel said.
“The legislation says that we have to have a plan in front of the minister (by August 2016) to privatize the organization … and we thinks it’s very important that we’re moving much faster than those timelines.”
Jean Marc Ruest, vice-president of corporate affairs with Richardson International, said the first year of open grain marketing has gone as well as anyone could have expected.
“By and large, it’s been a very positive experience for us. There was a bit of a learning curve … but at the end of the day, I think the markets adjusted very quickly and very well.”
From Richardson’s perspective, handling agreements between CWB and private-sector handling companies have worked well for farmers.
“I think it has taken maybe a little while to adjust to the new commercial relationships between ourselves and the wheat board,” he said. “But we’re satisfied that our customers were offered the option of choosing whatever program they preferred to participate in, so I think that’s worked out well.”
