The Canadian Wheat Board will be gone within months if the federal government insists on ending all aspects of Western Canada’s single desk marketing system, said the CWB chair.
Allen Oberg said the wheat board has no chance of surviving in a completely open market.
Oberg said the CWB will contact federal agriculture minister Gerry Ritz seeking further clarification on whether Ottawa is committed to eliminating the single desk entirely or whether it would be willing to protect some part of it.
“If the single desk is removed, the (CWB) will be wound down, there’s no argument about that,” Oberg said.
Read Also
VIDEO: The Western Producer Markets Desk crop outlook for 2025
Watch this video for a 10-minute update of Prairie crop conditions and markets. Bruce Burnett, a weather and market analyst…
“We’re going to seek further clarity from the federal government as to their level of commitment, if any, to the creation of a new organization.”
A government decision to retain some elements of the single desk might allow the board, or some derivative entity, to continue operating in some capacity, he added.
At meetings in Winnipeg last week, CWB directors analyzed 19 alternative marketing structures to determine if any would provide a significant benefit to farmers.
According to Oberg, the board concluded that none delivered the same level of benefits to farmers as the single desk.
“We have basically completed our analysis on that,” Oberg said.
“And we once again came to our conclusion that there’s no alternative out there that offers anywhere close to the same kind of value that the current single desk does.”
Some marketing models that confer single desk powers over a portion of the market might provide some additional value to farmers, Oberg suggested. One such structure – the retention of single desk powers over export sales but not domestic sales – has the potential to add considerable value to prairie farmers’ bottom lines, he said.
But retaining any part of the single-desk structure would require a significant softening of Ottawa’s position and does not appear to be in the cards, he added.
“With what the minister has said, and the way it looks like he intends to proceed, those types of alternatives will not be on the table because he’s calling for a total elimination of the single desk by Aug. 1 next year.
“We’re still hoping that they (Ottawa) will respect the decision of farmers in this plebiscite but … (if ) they choose to ignore that and … if the single desk is removed, the organization will be wound down.”
CWB directors also agreed that Ottawa, not farmers, should cover all costs associated with winding down the board.
Those costs, including pension liabilities, severance payments for the board’s 400 or more employees and settlement costs for cancelled sales contracts, would almost certainly run in the hundreds of millions of dollars, Oberg said.
“There was unanimous agreement that when the organization is wound down, that the government (should) be paying for those wind-up costs, not farmers,” Oberg said.
Jeff Nielsen, a farmer elected director from Olds, Alta., characterized last week’s meetings as progressive.
“We had some good discussions and we’re moving ahead on a couple of different fronts,” Nielsen said.
Nielsen did not offer specifics but he said board members discussed steps involved with ending the CWB and looking ahead at what might transpire when the single desk no longer exists.
Oberg said CWB directors ex-pressed concern over what they perceive to be a lack of consultation within the grain industry, saying Ottawa should be seeking more input from farmers, producer groups, grain companies and stakeholders in the malting industry.
Ottawa has formed a task force to look at issues that are likely to arise once legislation to end the single desk is passed.
But membership on the task force is not truly representative of the grain industry, Oberg suggested.
The task force – led by deputy minister of agriculture John Knubley – includes representatives from the Canadian Grain Commission, the Canadian International Grains Institute, Grain Growers of Canada, Pulse Canada, the Canola Council of Canada and at least one academic.
“It seems that those that are most affected are not represented on that task force,” Oberg said.
“They’re going to be talking about producer cars, access to elevators, port facilities, advance payments (but) … there’s nobody there from producer car groups, the grain industry is not represented there, the malting industry .”
The CWB was invited to sit on the task force but Oberg said the board opted not to be part of the group.
The board is planning to make a submission to the task force, as are a number of other organizations.
