The Canadian Wheat Board says Ottawa would have to spend at least $425 million plus debt guarantees and favourable regulations if it is to survive as a voluntary marketer.
CWB chair Allen Oberg said the Conservative government has had the board’s recommendations since July but has not responded appropriately.
“It will be up to this government to decide what assistance they are willing to provide,” he told an Oct. 17 news conference.
“If it (a voluntary CWB) has to operate on strictly commercial terms, it will not be here for long.”
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Agriculture minister Gerry Ritz’s office did not make him available Oct. 17 to answer questions about the CWB demands. They include:
• A $225 million capital injection to help the voluntary board finance inventories and business operations until it has a track record to take to private lenders.
• A “risk reserve” of $200 million to cover initial payment guarantees to farmers in case prices fall.
• Borrowing guarantees for at least five years to cover debt financing.
• Government ownership of the new voluntary marketer on an interim basis because another ownership structure could not be created in the nine months before the proposed end of the monopoly. “An appropriate exit strategy would have to be put in place to enable the government to divest its shares in the new entity in due course.”
• Regulations to allow the voluntary CWB access to country and port grain terminals because it will have no facilities of its own. It is a proposal rejected by an industry working group appointed by the minister that laid out a strategy for ending the monopoly based on largely unfettered market forces with no special deals for a new CWB. Grain companies have opposed any special government help for a new competitor.
• Regulations to allow a voluntary CWB to direct its grain to the export port terminals of its choosing rather than sending it into the general grain pipeline.
Although Ritz insists he wants CWB supporters to have access to a viable voluntary company, it is a list of demands the government seems unlikely to meet.
Oberg said the demands are the least the board needs to have a chance of surviving in the marketplace. He said the proposals have been before the agriculture minister since July, although Ritz “attempts to paint CWB directors as being uncooperative.”
It is the government that has not responded, he added.
Even as the board makes its demands for government help to usher in a new voluntary CWB grain marketing entity, Oberg offered a defiant rejection of the Conservative government’s plan to end the monopoly.
Prime minister Stephen Harper and Ritz want farmers to believe “this is inevitable, a done deal,” he said. “I’m here to tell you this is not over. We cannot in good conscience give up this fight. The government’s approach is illegal, it is against the wishes of farmers and it is harmful to the economic interests of Canada.”
And despite the outline of what the government should do to help, Oberg insisted the board will fight the government plan.
“We will fight this in Ottawa, we will fight this in the courts and we will fight this in the court of public opinion,” he said. “This is nothing but contempt for farmers and contempt for democracy.”
