ARBORG, Man. – In a banner year for grain prices, the Canadian Wheat Board brought home a few pennants of its own.
In its report to farmers for the 1995-96 crop year, the wheat board says it achieved record average sales values in the wheat and feed barley pools.
But at a Grain Days meeting last week in Arborg, Man., the brightest banner flown was for malting barley.
The wheat board’s executive director for marketing said it sold a record 2.5 million tonnes of malting barley for a record sales value of $620 million, or an average of $243.20 per tonne. Board costs – administration, country elevator carrying charged, demurrage, freight, interest and depreciation on CWB hopper cars – totalled 48.4 cents a tonne.
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Adrian Measner said the previous record was 2.26 million tonnes sold for $392 million in 1994-95.
Altogether, the wheat board sold 22 million tonnes of grain for a record $5.8 billion in total revenue.
Tonnes of wheat
Farmers delivered 14.4 million tonnes of wheat to the board, 80 percent of which was in the top two grades. The average sales value was $265.61 per tonne, compared to $199 per tonne in the previous year.
Total board costs for wheat were $5.15 a tonne.
Measner said farmers delivered less durum in 1995-96 than in the previous crop year, but the pool had a record sales value of $1.1 billion. The average sales value was $284.48 per tonne. Total board costs for durum were $6.56 a tonne.
Farmers produced more than 12 million tonnes of feed barley and delivered less than 1.3 million tonnes to the board, for which they received an average of $210.30 per tonne, minus board costs of $2.71 a tonne.
Measner said sales values this year could be another story.
While 1994-95 saw low stocks worldwide, farmers in importing and exporting countries produced more wheat and coarse grains in 1995-96 than expected.
They harvested 575 million tonnes of wheat, 30 million tonnes more than in the previous banner year. Measner said competition is fierce, and he expects buyers to play exporters off each other for the next few months.
More ominously, Measner noted the European Union has started to subsidize wheat and barley exports again, and said he’ll be watching the United States closely to see if it revives its subsidy program.
He said visiting new customers and helping them learn to use Canadian wheat and barley is the key to avoid competing with other exporters on price alone.
He referred to a survey of wheat and barley buyers commissioned by the Western Grain Marketing Panel which showed customers rated Canada tops for quality and customer service, and dead last on price.
“The CWB’s prices are too high,” Measner told farmers. “This is precisely where we want them to be.”
Canada made its first-ever sale of durum to Iran this year because of its market development work, he said.
South Korea sales
The wheat board also convinced South Korea to buy feed barley for the first time. The country lowered high tariff walls enough to let in 50,000 tonnes this year, and Canada filled it.
Market development is “something we can do in Canada because we have the one agency selling,” Measner said.
“It’s not something that happens in all countries.”
