The grain industry is closely watching CWB’s attempt to keep pooling programs operating in a post-monopoly environment.
And some are skeptical they will survive.
“I think they’re going to have a very difficult time buying barley in a pool system,” Pat Rowan of BARI Canada said during a panel discussion at Grainworld.
“I think the board’s going to have a difficult time remaining in the barley industry.”
Rowan said malt barley is now trading and contracted at flat prices, and many farmers won’t want to pool their grain and leave the price uncertain for many months.
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Grain trader Doug Hilderman of NorAg Resources said price uncertainty will make pooling unattractive for any crops now that firm pricing of former board grain is easy to achieve.
“In my opinion, in an open market, the whole pooling concept is dead,” said Hilderman, who has operated in the prairie, Ontario and Quebec grain markets for a number of grain companies.
He compared pooling to insurance, in which most people pay to cover the losses of those who are unfortunate.
Prairie farmers close to multiple buyers won’t feel they need that insurance, he said.
“The producer in southern Alberta, southern Saskatchewan, the Red River Valley, they’re gong to exit the pool,” said Hilderman.
“The only people who are going to sign up in the pool are people who are disadvantaged.”
He said that won’t bring good returns to those who remain in the pool.
“It only works if everybody’s in.”
Hilderman said CWB can “survive and thrive” in an open market, as his company is doing, but it won’t be business as usual.
“It’s going to be a completely different operation,” he said.
“It’s really going to be a grain trading operation.”
