The Canadian Wheat Board says it will do its best to execute barley sales contracts entered into by private companies that anticipated an open market going into effect Aug. 1.
But the board’s vice-president for marketing said there is no guarantee that all those sales will come to fruition.
“It’s not possible to say all the business will be fulfilled,” said Gord Flaten.
Industry officials estimate that in the weeks leading up to Aug. 1, at least 500,000 tonnes of feed barley sales were negotiated privately.
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With the single desk remaining in place as a result of a July 31 Federal Court decision, all those contracts are now legally null and void because all export sales or sales to domestic maltsters must be handled through the board.
Flaten said the board is contacting all the companies and asking them to provide details of the contracts.
“We’ll look at them, and we’ll work with the companies to try to execute the business that needs to happen,” he said, adding the logistical details of how that will be done have yet to be worked out.
“We don’t know how much business was done or under what terms,” said Flaten.
He said the board will deal with the issue on the basis of three overriding objectives: maximizing returns to producers; ensuring customers who have contracted to buy barley from Canada are serviced; and treating fairly the grain companies that made the sales.
The board will also talk with maltsters to ensure their needs are being met.
As for farmers who may have made private sales to buyers in the United States, they should contact the board to see what arrangements can be made.
Meanwhile, some farmers are upset that barley prices took a dive the day after the court ruling was announced.
Charles Anderson, a Rose Valley, Sask., farmer and member of the Market Choice Alliance, said the board should reimburse farmers for the price decline.
“By using political obstruction and legal roadblocks, the actions of the CWB have caused significant and measurable loss for my business,” he said.
His organization has posted on its website an invoice form for farmers to send to the CWB to document their losses and claim payment.
CWB chief executive officer Greg Arason said a number of things contributed to the decline in barley prices, including competition from cheap
U.S. corn and dried distillers grain, international trade factors and grain companies adjusting their basis.
“Ultimately supply and demand will sort this out and prices will reach their proper level,” he said.
Arason added that with all the uncertainty and chaos in the barley market in recent weeks, it will take some time for things to return to normal.
