FARGO, N.D. – Some American farm groups showed interest last week in the idea of a grain marketing alliance between Manitoba, Saskatchewan and three states.
The idea was floated during the Northern Plains Producer Conference, held here Nov. 15 to 17. The conference offered farm groups from the northern plains region a chance to talk about ways of working together.
“Our problems are the same,” said Jim Broten of the North Dakota Barley Council.
“Your people aren’t getting the returns they want. We’re not getting the returns we want.”
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There were no details given at the conference to suggest how the grain marketing alliance might work. The idea arose during a brainstorming session among farm groups involved in the grain industry.
Kelly Shockman, a North Dakota member of the National Farmers Organization, said he supports the concept of grain pooling. However, he believes a marketing alliance would have to be voluntary and producer controlled.
“We think it could be done, but it’s got to be done at the producer level. If you have a good program and a good plan, the people would support it.”
Frank Dilse, of the North Dakota Wheat Commission, said some issues would have to be settled before pursuing a cross-border marketing alliance.
He cited chemical standardization as an example, as well as what he considers the “predatory pricing practices” of the Canadian Wheat Board.
Dilse suggested a cross-border marketing alliance might work best for producers who have found a niche market. He noted that grains on both sides of the border are grown in similar soils and under similar climates.
Creating a cartel
Another idea brought forward at the conference was the creation of a regional durum and barley cartel.
Kevin Archibald, president of the Western Canadian Wheat Growers Association, said he would not support the cartel, especially if it was mandatory for durum and barley growers to belong.
Archibald said a cartel might backfire if the goal is to have a marketing monopoly for the region’s durum or barley. Trying to use the monopoly to force higher prices from processors would scare buyers away, he said.
Archibald’s association opposes the wheat board’s monopoly on wheat and barley destined for export. He doubts a durum and barley cartel would sell in northern tier states if membership was compulsory. And the northern plains region grows most of North America’s durum crop.
As for a marketing alliance, Archibald said the best option would be value-added ventures formed by growers in the region.
“If there’s going to be a strength in a market alliance, that’s where the strength would be.”
However, he noted that things such as tax policy and the rules for investing in farmer-owned co-operatives need to be harmonized.
The idea of a marketing alliance or cartel shows Americans recognize the advantages Canadian farmers gain through the wheat board, said Don Dewar, president of Keystone Agricultural Producers.
“They see it as a market power that gets results for producers.”
Dewar said a cross-border alliance to market a grain commodity would work only if it was based on a single-desk monopoly.
