Dual marketing
To the Editor:
In a single-desk marketing system, everyone consistently gets near the average market price. In an open or dual marketing system, over a series of years, only 10 to 20 percent of farmers will consistently get above-average returns.
The rest will have to take below and sometimes much below average. Ask yourself if you are confident that you can consistently be in the top 20 percent.
If you have any doubts, it’s in your best interests to get out and make yourself heard in support of board single-desk selling. … The proponents of open marketing are certainly speaking out.
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Agriculture needs to prepare for government spending cuts
As government makes necessary cuts to spending, what can be reduced or restructured in the budgets for agriculture?
Don’t let them destroy something that can’t be rebuilt!
– John Castle,
Miniota, Man.
CWB tyranny
To the Editor:
Re “Barley tyranny” written by Roger C. Buxton (Open Forum, Dec. 14): I attended the Alberta Barley Commission meeting in Red Deer as an observer since I was not eligible to vote. It appeared to me that the ad nauseam and sometimes red herring questions and speeches by the pro-CWB group were tolerated to excess and that speeches by either side were not going to sway anyone since minds were made up as to which way they were going to vote long before the meeting started.
I found it extremely interesting that the pro-CWB group complained several times (as does Mr. Buxton) that they were denied their democratic right to speak, yet those same people want to use the tyranny of the CWB to deny the democratic rights of the majority of Alberta wheat and barley growers to market their grain as they wish.
And re “Alberta plebiscite can’t be ignored”: Mr. Fairbairn wonders how many of the 20,000 out of the 36,000 (his figures) eligible farmers who did not vote in the Alberta plebiscite either had no complaints with the board or thought the plebiscite was a sham.
Using the same logic he should be wondering how many of the 21,188 out of the 33,429 (CWB figures) eligible Alberta farmers who did not vote in the CWB Advisory Committee election either had complaints with the board or thought that the election was a sham.
– Ralph Poffenroth,
Calgary, Alta.
Need board
To the Editor:
… To gain a stranglehold on Canada’s wheat and barley export market, the private grain trade is making a concerted effort to break the Board’s export monopoly powers and return farmers to a fully speculative grain marketing system and the dog-eat-dog system of the Thirties. The Canadian Wheat Board (CWB) is the world’s largest grain marketing board, and the world’s single largest merchandiser of both wheat and barley.
It is Canada’s single largest net exporter, selling to more than 70 countries.
Price pooling remains the cornerstone of the CWB. …
The strength of the CWB is its single-desk selling monopoly. Because all wheat goes through the CWB, it is assured a certain volume, and can assure customers a consistent quality standard. …
Even in an unusual year like 1993-94, the U.S. market can only handle about 13 percent of the wheat, 48 percent of the barley and 16 percent of the durum Canada exports.
The rest has to go into other markets where customers have access to subsidized grain.
Thus, while the U.S. market may be at present a premium market for a very small portion of Canada’s grain exports, without the CWB that market will see more Canadian grain competing to get the market and thus a drop in prices for all producers, both U.S. and Canadian. …
Farmers need greater bargaining power in today’s cut-throat international grain markets, not less.
– Joyce Neufeld,
Waldeck, Sask.
Pool changes
To the Editor:
I am a retired farmer who has taken the Western Producer from 1923 to the present day. I was privileged to receive a plaque from the Editor, R. H. D. Phillips, in 1983. I still receive this paper in 1996 and expect to continue getting this excellent paper which will be 73 years in 1996. I doubt if there are many who have been able to be still living and have still read this paper for that long.
I have been a member of the Pool Committee in Prince and Iffley for 50 years. Both of these points no longer have an elevator. When we first took our grain to Prince there were no Pool elevators nor any elevators. The farmers would gang up and help each other to load a car (only 1,000 bushels), all by hand and a lot of it not on the platform, just shovel it up from some place in the ditch along side of the car. That was real work. There were no trucks then or grain augers.
I threshed around the country east of Prince and Scentgrass as far east as Hatherleigh. I used to give the farmers an extra 100 bushels on 1,000 and when we threshed for some farmers who sold their grain to the line companies, it was often said by the farmer that I had not given him full weight. It was not long till people knew what was wrong. One man that we knew who was operating the line elevator said that if he did not steal his wages he would have no job. Very little of the grain we threshed went to the line companies.
We never had a fair deal till we had the Pool elevators. Now I am wondering why the Pool Directors are starting to sell shares in the Pool. This should never be done, it simply means the end of the Pool. The members of the Pool should at least have a vote on such an idea. No delegate has the right to sell shares in the Pool. Shares that are sold on the open market means that the shares can be bought by any person or in any other country. It is time to stop such a thing. All of our different kinds of grain should all be handled by the Pool and keep the Canadian Wheat Board.
I don’t farm anymore but I sincerely hope that the younger farmers listen to their old farmers and act accordingly before it is too late.
– Oliver H. Humphreys,
North Battleford, Sask.
Price pooling
To the Editor:
In the Dec. 7 issue of the Western Producer, G. Fairbairn has a misconstrued perception of off board price pooling.
Changing prices minute to minute would not affect farmers, if you are marketing your off-board grain into the first step of the system. I will guarantee it would not be a foot race to the weigh scale.
You would simply pick up your phone, find the price you are willing to sell for, and do a verbal contract over the phone. Then haul at your leisure when the grain company calls it.
The difference with this price pooling, as usually there is a morning and afternoon price, is once you sell it you know exactly what your bottom line is. With the Wheat Board’s pooling they only guarantee initial payments; the remainder of the pool occurs up to 17 months after the initial signing of the contract.
In the next 12 months any chain of events can happen anywhere on the globe that can affect the outcome of the price pool. So when you sign a Wheat Board contract, you had better be satisfied with only the initial price because that is all you are guaranteed.
Now, Mr. Fairbairn, when the Wheat Board is paying $4.50/bu. and across a skinny 49th parallel they are paying $8/bu., that goes to the bank that day, which would you choose? I would like to know if Mr. Fairbairn would be in favor of receiving about two-thirds of his wage when his boss decided he could pay it, then in 17 months spin a roulette wheel which would decide what further money he would receive, if any.
In closing, if the Canadian government want their fingers in private enterprise and like the pooling system, why don’t they take control of fertilizer prices and pool them?
Then we all pay one price, not as it is now, where the established, well-to-do farmers can afford cheaper fertilizer in fall and others waiting for Wheat Board cheques are paying high prices in spring.
– Daryl Maurer,
Francis, Sask.
Fine farmers
To the Editor:
On page 16 of the Dec. 14 edition of the Western Producer, you have a story about a new agricultural bill passing through the Senate without even a debate.
The bill allows Ag Canada officials the right to impose fines on the spot for “unsafe, unhealthy or poor quality agricultural products”.
This is typical of the thinking of politicians and senior civil servants in Ottawa. Not only do they feel they are above the law, they are the law.
I wrote them a little poem.
Mr. Goodale, Ag Canada
I think your attitude really sucks
What gives you the right to impose fines
For several thousand bucks?
Ag Canada officials are now the law
without even a sheriff’s badge
Am I now a criminal for storing
that jug of Treflan in my garage?
Will you now be watching my wild oats
Growing down by the creek?
Will I need to worry
Every time a hydraulic hose springs a leak?
Where is my constitutional right,
to trial by judge and jury?
Who decides what’s right or wrong
with your justice in a hurry?
No need to have a hearing,
imposing fines on the spot.
Very handy for officials,
Justice it is not!
– Victor Hult,
Waseca, Sask.
Need choice
To the Editor:
The battle for or against the CWB will probably go on for many years. …
I have a possible solution. Every year, about the 15th of June, the CWB could send out a very short questionnaire: “Mr. Farmer, do you wish to market your wheat and barley through the Board this next crop year? If so, please indicate seeded acres. If you vote no, you will not be allowed to sign a CWB contract for wheat and barley …”
This way, the Board would have a good idea of how much grain it would be able to market that year. And the anti-Board people would have the freedom to market their own grain the way they see fit. Any farmer voting yes and caught marketing this grain outside the Board that year would face some sort of monetary fine.
The farmers close to the U.S. border could go it on their own, but they could not have the choice to use the Board as well. Here in my part of the province I feel that we are too far from the border to make any money trying to sell our grain on our own. And I think the majority of the farmers around here support the CWB.
– John S. Fenrich,
Wilkie, Sask.
Hopper cars
To the Editor:
I would like to say a few words if I may in support of the numerous dissenting voices as regards the formula suggested to dispose of the government’s fleet of 13,000 hopper cars. The negative side of this proposal was recently very effectively described by the President of the Saskatchewan Association of Rural Municipalities.
In my view we first need to look at why the government was required to procure these cars and that was because the railways refused to provide an adequate supply of rolling stock to meet the needs of the prairie grain industry. These were paid for by Canadian taxpayers and in order to assist further, the governments of Alberta and Saskatchewan also added a significant number at their taxpayers’ expense. Then the CWB provided a goodly amount of cars as well to make an efficient fleet of rolling stock.
Now we are to sit complacently by and watch the railways acquire these for the pittance of 25 percent of their estimated worth, as well allowing the railways the privilege, audacious as it is, to levy an additional dollar a tonne with which to recoup their dismal investment, under the disguise of a commitment that these shall at all times (for a short period at least) be available for grain transport.
Consider their performance in the incentive rate matter in unit train loadings, wherein as soon as they considered the move to Inland Terminal type elevators sufficiently launched to prevent any irreversibility.
Bingo. Off come the incentive rates. I would be inclined to view the aforesaid commitment with a grain of salt. If it was practical to offer incentive rates during the introductory phase to large elevators, why is it not now?
It is quite obvious that these cars are just as vital to the farmers as their tractors and combines are, and it would be quite logical for their marketing agency, the CWB, to have control of them. So if the Minister of Transport thinks they are only worth 25 percent of their estimated worth, then the CWB should have first crack at them.
– Philip Lindenback,
Weekes, Sask.
Open market
To the Editor:
I am one of those misguided, brainwashed, uninformed producers who voted in favor of an open market for my grain. And I am amazed at the amount of “navel gazing” going on in your paper’s articles on the subject, trying to figure out why I and many of my fellow producers choose to opt for my basic democratic right, to market the fruits of my labor when, where, and to whom I may choose. I realize that it must have come as a severe shock to those people inclined to have governments do everything for them, that there are quite a few people around who are willing and able to stand on their own two feet.
All the excuses about voting irregularities, wrong question, lack of information, and whatever else is used to discredit the result of the vote cannot change the fact that two out of three farmers want to see some drastic changes in the way they market their grain. Don’t believe me? Why not hold a vote on the subject prairie-wide? All you have got to lose is your conviction that most people like to be led around by a leash.
– Karl H. Schneider,
Mannville, Alta.
Share values
To the Editor:
Management of Saskatchewan Wheat Pool has put the issue price of the privatized Pool shares at $12, selected from a range offered by RBC Dominion Securities of $11.50 to $14.50 per share.
It appears that RBC DS did a competent job of providing an opinion to the Board of Sask. Wheat Pool on the estimated price range within which Class B shares could be expected to trade in the public market.
The Board then decided to take the lower end of the range when offering a price to the farmer owners.
However, the farmer members of Sask Pool, who never suggested selling in the first place, wanted to know something else. They wanted to know what their company is worth as an ongoing business, and what we could get for it if selling it to a competitor.
Approximately $305 million of “share capital” (dividends allocated but not paid) is being consolidated into 30,500,000 shares. However according to the Pool prospectus, “members equity” at July 31, 1995, included as well $138,357,000 in retained earnings (dividends not allocated) and totaled $443,700,000.
If the $443,700,000 was divided among 30,500,000 shares, the share value would be about $14.50, the upper limit of “value” selected by RBC Dominion, but also the very minimum that Pool should be worth.
Thus a valuation at $12 per share does not offer the farmer member a premium of 20 percent on real value as Pool management has said, but offers about a 17-percent discount on the minimum value for the company. By any measure the issue price of $12 … is too little. At least we might expect a half way point in RBC DS’s wide range, at $13. …
If a company has net earnings of $76.5 million and potential to increase that, a buyer who wishes to see a 10-percent pretax return on investment would value the company at $765 million. Spread over 30,500,000 shares, per unit value is $25.00. …
By any conventional measure, including the work of RBC DS, it appears there is good room for appreciation in the value of Sask Pool shares. Naturally. How else does an agency do a large-scale privatization and move all the shares to investors? The opportunity for almost immediate gain must be there.
The “valuation” has little to do with what the loyal member customers of Sask Pool, now dispossessed, deserve for their accumulated investment. The price has been made sufficiently low that it discourages those farmer members who would like to bail out in disgust.
So, what should the farmer who objects to the privatization and this valuation do? I suggest that in protest, he offer all his shares for sale during the “in-house” trading period. If Pool management is flooded with offers to sell, and are short of matching orders to buy, they may be forced to rethink this entire caper which has amounted to a high-handed coup d’etat at Sask. Wheat Pool.
– Norman Bray,
Regina, Sask.
Marketing
To the Editor:
Are you part of the silent majority that supports single-desk selling? If you are, you must not be silent any longer.
Those with the authority to change the system can only go by what they hear from the people and right now they are hearing plenty from dual-market supporters. The law of the jungle is returning! Speak out now or forever hold your peace.
– Wayne Sotas,
Solsgirth, Man.
CWB benefits
To the Editor:
Who benefits from the operations of the Canadian Wheat Board? The Canadian people benefit, as a single-desk seller of grain for export it is able to get a better overall price for the grain and by so doing strengthens the entire Canadian economy.
More money in the farmer’s pocket means a healthier economy. The Wheat Board activity limits the extent to which the commodity exchange can manipulate the market.
The huge power of the international grain companies wants rid of the Wheat Board.
The speculators on the commodity exchange want a chance to bleed off a portion of the money that should go to the hard pressed primary producer. … Remember power corrupts and absolute power corrupts absolutely. The Wheat Board is a civilized and enlightened way of putting some checks and balances on the corporate power of the grain trade. Of course, the Wheat Board could be improved but let’s not throw the baby out with the bath water.
– J. Leslie Wilson,
McCord, Sask.
Coyotes
To the Editor:
The article “Too many coyotes” (Dec. 21) caught my attention. In the lower mainland of the Fraser Valley the fox has disappeared and small dogs and cats are endangered.
In the densely populated West End of the city of Vancouver coyotes roam and are regularly seen, even in broad daylight.
I wonder why Mr. Dave Brewster of the wildlife offices in Saskatchewan would say that it is unrealistic to think the coyote population would continue to grow and cause problems in towns. Do they have special “keep out” signs for the coyotes?
It is no longer safe to let small dogs and cats outside the house unless supervised.
A local sheep farmer who has all pastures fenced with electric fencing recently lost four valuable purebred sheep to coyotes. Perhaps Mr. Brewster could offer some better answers.
– Joan Wootton,
Langley, B.C.
Quebec rights
To the Editor:
The responsibility for the defeat of the separatist referendum in Quebec rests squarely upon the shoulders of Jacques Parizeau, Lucien Bouchard and the Quebec Assembly, for the French-only law denying to non-Francophones the right to use the language of their choice in business dealings …
Jacques Parizeau was right on when he stated that it was the ethnic, the non-Francophone, vote which defeated the referendum. He should know. It was he and the Quebec Assembly who denied equal rights to non-Francophone citizens.
– Frank Snowsell,
Kelowna, B.C.
