The Canadian Wheat Board says it reaped higher prices for producers in world grain markets last year than its competitors did.
The marketing agency last week released figures used internally to assess its corporate performance and that of individual employees.
The results showed that in 2005-06, CWB prices were higher than its competitors by $8.66 a tonne for wheat, $5.98 a tonne for durum and $7.77 for malting barley.
The numbers are based on a comparison of the CWB’s selling price against the relevant competitor’s price for comparable quality grain at the same location at the same time.
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For example, say the CWB sold 1 CWRS 13.5 percent protein to a customer in the United Kingdom for May shipment out of Thunder Bay. That price would then be compared with the selling price for U.S. DNS 13.5 percent out of Duluth, Minnesota.
The analysis is performed for every sale by the CWB during the year to determine the weighted net average spread.
“I’m very confident in the accuracy of these numbers,” said Bill Toews, a CWB director from Kane, Man.
All the results for 2005-06 were above the targets set by the directors, who review the results for each sale.
The board has done such benchmarking for years, but this is the first time the results have been released publicly.
Chief executive officer Greg Arason said the board decided to go public in order to be as accountable as possible to farmers.
“By developing and publishing these measures, the CWB is striving to ensure that accountability is transparent, results based and quantifiable,” he said in a news release accompanying the annual report.
Board spokesperson Maureen Fitzhenry said it has taken a few years to refine the methodology to ensure the numbers provide an accurate measure, adding the timing is not related to the ongoing debate over grain marketing.
She acknowledged critics of the board may be skeptical of the numbers, but said they are used internally to assess performance, which attests to their accuracy.
However, a couple of CWB directors who favour an end to the board’s single desk weren’t overly impressed with the sales comparison.
Appointed director Ken Motiuk supports the idea of benchmarking, but said he’s not convinced the methodology is foolproof.
“Because there are financial repercussions to these number in terms of employee bonuses and compensation and so on, that’s one reason to make sure those numbers are accurate,” he said. “I would like to consider it a work in progress.”
He also cautioned against drawing any conclusion about the value of the single desk from the price comparison numbers.
If there is a price advantage, it could be due to variety of factors, including quality, branding, reputation or the single desk.
Elected director Henry Vos of Fairview, Alta., another open market supporter, said he was disappointed that the price differential wasn’t higher, given all the advantages the CWB supposedly has in the world market.
He also thinks the price advantage identified in the report would be eaten up by higher costs that farmers face because of the rules imposed on them under the single desk system, such as on-farm storage and delivery restrictions.
