ARBORG, Man. – Proposed changes to the Canadian Wheat Board act would weaken the board, according to its advisory committee of farmers.
The committee has written to agriculture minister Ralph Goodale to tell him his amendments to the act, contained in Bill C-72, make the board too flexible and less accountable.
Committee member Bill Nicholson told farmers at Grain Day meetings last week he’s most worried about the wheat board getting involved in cash trading.
The wheat board asked the government to change its legislation so it could buy grain on the cash market when it can’t get enough to fulfil contracts and when it’s trying to avoid demurrage costs or penalties.
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In an interview last week, chief commissioner Lorne Hehn said the board would only buy grain on the cash market when it would benefit pool accounts.
Nicholson, a farmer from Shoal Lake, Man., said the committee initially agreed with the proposal during the Western Grain Marketing Panel hearings last year.
But since meeting with the Australian Wheat Board and some academics, Nicholson said members changed their minds.
Principle would be lost
“While it’s an idea that might work once, each use of it just encourages future use and eventually the principle of pooling could not be sustained,” he explained in an interview.
Once farmers know the wheat board will pay more than the pooled price for grain when it needs grain to fulfil contracts, their “natural tendency is to withhold even more from the pool in anticipation of these better cash prices,” he said.
Over time, cash trading would weaken the pool, Nicholson said.
He believes there are other solutions that would work just as well. For example, the wheat board had success with a phone campaign early in the 1995-96 crop year to encourage feed barley producers to sign up for contracts.
Other avenues to take
“I think it’s possible to do things in other ways that may be consistent with the pillars of the board, rather than risking something like this cash trading amendment,” Nicholson said.
A proposal to let the board have shorter pooling periods would also be unfair to some farmers, he said.
The committee is also concerned with the role of government in hiring and firing senior officials and boards of directors.
In a news release, vice-chair Terry Hanson said management of the board should be accountable to an elected group of farmers similar to the advisory committee, but with more power.
Other concerns include:
- Loss of the government guarantee to adjustment payments.
- The effect of changing the board from a crown agency to a mixed enterprise on borrowing costs and international reputation.
- Lack of provisions for including other grains under the board.
Nicholson said the advisory committee approves proposals to speed up final payments to farmers, and some other minor “housekeeping” amendments requested by wheat board management.
The bill is now before the House of Commons agriculture committee. The advisory committee wants it to hold hearings on the bill in Western Canada so farmers can express their views.
