The Canadian Wheat Board says it provides prairie farmers with a net financial benefit of at least half a billion dollars a year.
In its presentation to the federal government’s task force on dismantling the board’s export monopoly, the marketing agency pegged the net benefit of CWB operations at $530 to $655 million a year.
A board official described the number as a conservative estimate, saying the total is almost certainly higher.
“We included only those things that we could attach a concrete dollar value to,” said Deanna Allen, CWB vice-president of farmer relations and public affairs.
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Here are the items included in the board’s estimate, with the dollar estimates based on previously published studies and internal estimates:
- The value of premiums resulting from single desk marketing for wheat, barley and durum, between $297 million and $417 million a year.
- Gains from tendering and other railway and handling agreements, $92 million to $103 million.
- Net interest earnings, $66.2 million.
- Managing access to the delivery system, $115 million.
- Blending at terminals, $7 million to $10 million.
- Farmer access to producer cars, $6 million.
Allen said it’s difficult to attach a dollar value to many of the board’s other activities, including supporting short-line railways, freight rate savings, market development, branding of Canadian grain, contributions to research and its work in helping prevent the introduction of genetically modified wheat.
Allen, CWB chief executive officer Adrian Measner and chief operating officer Ward Weisensel met with the seven-member task force in Winnipeg Oct. 11.
The board’s presentation, including an accounting of the net value calculation, is available at www.cwb.ca.
The task force submitted five questions ahead of time to the board.
They addressed how the board would contract services with grain handling companies, whether the board would need to own grain handling facilities and the ownership structure of a restructured CWB.
In each case, the board prefaced its answer by saying that the question incorrectly assumed that the CWB would continue to exist in an open market environment.
Task force chair Howard Migie, director of strategic policy for Agriculture Canada, said he felt the board provided useful information.
He declined to say whether the board’s warnings that it can’t survive in a open market will be reflected in the report.
