Dry crops and high prices increase the temptation to add water to grain before delivery to increase weight and volume.
It is a dangerous practice and the dangers are not limited to the risk of getting caught and sanctioned. The bigger problem is potential damage it can do to the Canadian reputation for providing quality grain to customers and the leverage it might provide to buyers in negotiating lower prices for product.
Well-yielding cereal crops have delivered margins of less than $25 per acre in bygone years. Though prices have since improved, the prospect of leaving money on the table at the end of a season can be hard for growers to swallow.
However, western Canadian grain is typically some of the dampest on the world market. Unlike American small cereal crops that are harvested in the heat of summer, or Australian production that typically comes off during a long, dry fall, Canadian small grains and oilseeds are harvested on the edge of winter. Compounding this, western Canadian crops are typically shipped to market locations that have higher temperatures and they are milled in coastal environments that encourage condensation and spoilage.
Grain companies that collect Canadian harvests across the West have opportunities to profitably blend high and low moisture grain. It is an option most individual producers don’t have.
Grain is produced by volume and sold by weight, with a portion of the latter coming from water content. It’s a concern for growers, especially in the dryer south, and adds to frustration with the marketing system.
While hydration is often necessary at the milling stages, it is done under controlled conditions using food-safe water supplies. Adding water weight at the producer or shipper stage of the marketing process is deemed to be adulteration under the Canada Grain Act.
The act doesn’t specifically cite the practice as illegal. Water isn’t really the problem. Water quality and safety, plus the damage it can cause to product during elevation and shipping, is the real issue. Resulting damage to Canada’s reputation as a safe and sustainable supplier of food products could be a hidden cost to farmers.
Canada has a premium brand in the grain export marketplace. While not all of that premium seems to make its way to the farm, grain companies make a portion of their margins by managing moisture. They also are responsible for negotiation of price.
Rumours that Canadian farmers water their grain before shipping could be enough to prompt buyers to offer lower prices or give them an edge in settling quality or transportation-spoilage disputes.
All costs in the system eventually come back to the farmer.
That’s why grain watering must be discouraged. Fines could be increased but few producers will ever be caught or prosecuted. It might be more effective to require farmers to sign an affidavit confirming that no water has been added.
As well, growers have been asking for new rules that would cause buyers to pay a premium for lower moisture crops and other grain-grade quality attributes. While that won’t likely put more money into the grain system, it might encourage greater quality control and sustainable practices.
In the meantime, maintaining Canada’s reputation as a premium supplier of grains and oilseeds and sustainable production that avoids food waste is likely more profitable for producers over the long haul. The rules around grain adulteration weren’t made to be broken.
Karen Briere, Bruce Dyck, Barb Glen and Mike Raine collaborate in the writing of Western Producer editorials.