Farmers concerned over the loss of flax markets in Europe voiced their frustration this week during a conference call hosted by the Canadian flax industry.
In the first of two industry sponsored conference calls, flax producers discussed a variety of issues, including the loss of flax markets in Europe, deflated North American flax prices and rules imposed by Canadian grain handling companies that will force all Canadian flax producers to use certified seed in 2010.
Producers also raised concerns about the price and availability of certified seed and the extra costs associated with testing flax that is delivered to Canadian elevators this year.
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Flax markets were disrupted last year when traces of a genetically modified flax variety, CDC Triffid, showed up in shipments of Canadian flax destined for the European market.
In an effort to restore access to the European Union market, the flax industry has implemented a variety of measures aimed at detecting GM material in Canadian flax supplies.
Those measures include testing pedigreed flax seed and the mandatory use of certified seed by all commercial grain growers.
Quintin Stewart, a flax buyer for Viterra, said Viterra and other grain handling companies, not the EU, imposed the condition forcing flax producers to use certified seed.
Stewart also responded to suggestions that Canadian grain handling companies were capitalizing on the trade disruption by buying flax at low domestic prices and shipping GM- free deliveries to Europe, where they command a premium price.
One producer suggested that while he sells his flax to Viterra for $9 per bushel, the company can sell the same crop to buyers in Europe for $15 if it tests negative for GM contamination.
“I’m hearing right now that flax in Europe is selling for $15 a bushel,” the grower said.
Stewart said European buyers are paying a premium for non-GM flax.
Disruptions to the flow of Canadian flax into Europe have resulted in insufficient supplies and high demand, he added.
As a result, flax shipments from Russia and Ukraine are commanding premium prices among desperate EU buyers.
“There is obviously a premium that is being paid right now because of a lack of shipments,” Stewart said.
Dave Sefton, a Saskatchewan flax grower and member of the Saskatchewan Flax Development Commission, said mandatory use of certified seed is a tough pill to swallow for commercial growers because it involves extra costs and raises questions about seed pricing and availability.
Some producers suggested that certified seed prices are unusually high this winter because mandatory seed use has created an abnormally high demand.
Sefton said supplies are also uncertain.
“We really don’t know what volume of seed will be available for planting … and until we have that answer, it’s going to be difficult to quantify whether we have enough seed,” he said.
“At the end of the day, it really does come down to what the Europeans accept … The cleaner we can get the seed, the quicker we can get the door reopened in a more sustainable commercial fashion.”
