Council was forced to review its spending plans after grain company left, which members say was a valuable exercise
PALM SPRINGS, Calif. — There was no panic at the Canola Council of Canada’s recent annual meeting in the California desert, far from the tense canola industry politics surrounding Portage and Main in Winnipeg.
Conversations with farmers and the companies that serve the canola industry suggested that Richardson International’s decision to quit the council is being taken in stride and allowing for a more harmonious refocusing of the organization.
“Nobody’s happy about it, but these things happen in a diverse organization dealing with multiple interests,” said one long-time canola council member and commercial player in a conversation before the conference officially began.
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Richardson pulled out of the organization at the end of 2017, leaving the council with an embarrassing fracture and a big hole in its funding. Richardson, as Canada’s biggest grain company, was paying a big fee to the CCC, based on per-tonne levies.
In response, the council hurriedly scaled-down its 2018 spending plans, chopping 32 percent from the budget and setting up a “priorities review process.”
That process is giving the members of the council, which includes farmers, grain companies, chemical companies, seed companies, processors and others, a chance to determine how much emphasis and spending it applies to agronomy, market development and research.
In an interview, council chair David Dzisiak said neither Richardson’s pullout nor the re-engineering of the organization have damaged the commitment of key members to keep driving the canola industry forward.
“The mood is very positive. It’s very upbeat,” said Dzisiak, who recalled when the canola council’s goal was to produce 15 million tonnes.
“We’ve blown by that. We’re 50 percent larger than that.”
However, he acknowledged that the growth of the industry is one of the authors of the present tensions over levies. Members are charged differently depending on their commercial or other activities, and grain companies were being charged a flat levy per tonne for the canola they handled. That meant when canola production boomed, levies went up. And when companies grew, they ended up paying higher fees.
“Probably the one thing we didn’t do that we should have done is sat back and said, ‘OK, do we need to spend everything that volume generates?’ ” said Dzisiak.
Viterra was also said to be mulling over withdrawing from the council last year, and other companies have also grumbled about the council’s expanding activities and programs.
CCC President Jim Everson said assessing all those programs and roles is a big part of the present review. In the short term, with the big budget cut for 2018, lots of areas have been squeezed, while vital interests are being maintained.
“We’ve reduced some of our market development work (but) we’ve really maintained our focus on market access work,” said Everson.
When it pulled out, Richardson said it believed some of the council’s agronomy and market development work was redundant, since companies like Richardson had their own agronomists and overseas sales people. However, farmers at the conference seemed skeptical of company-owned efforts and no farmer representatives this reporter spoke with wanted to see the CCC reduce its agronomic outreach, especially since it is unbiased.
The restructuring, re-evaluating and refocusing of the CCC was a big topic of casual discussion amongst attendees, but played almost no role in the public elements of the meeting. In his official address, Everson described the efforts the council is making to address concerns and re-establish the consensus among players and sectors but did not directly refer to Richardson’s departure. Nor was he publicly asked about the issue.
The companies and farmer organizations that still comprise the council seemed to be moving on, and no one seemed to feel any great fear that the organization itself was imperilled.
“There is always a bit of tension and angst as you start that because it is unknown where you’re going,” said Dzisiak.
However, the council’s members still seemed mostly focused on its lofty goal of producing 26 million tonnes of canola by 2025, an average of 52 bushels per acre, rather than simply mulling over internal divisions.
“We’ve got tremendous opportunity as an industry, like none that I’ve ever seen in my life,” said Dzisiak.
