The Monopoly Behind The Mineral

[chuckChuck]

http://www.theglobeandmail.com/globe-investor/potash/canpotex-and-potash-the-monopoly-behind-the-mineral/article1778912/

What do you farmers think about Brad Wall's support for Canpotex? Read the Globe and Mail story - link above. Interesting to see a free market politician recognize the value of a monopoly seller of potash. Even Brad has the sense to know that monopoly sellers can increase returns in the marketplace. This policy contradicts the Saskatchewan Party's lack of support for the Canadian Wheat Board. Obviously Mr. Wall thinks potash producers should have marketing power to keep prices and royalties high but 1000s of farmers should market their own product without the benefits of a single desk like Canpotex. Go figure!

[ajl]

CWB is a monopoly buyer not a monopoly seller. Board supporters will not and can not figure this out. We do not use much potash so I am wondering if using canpotex to keep potash prices higher helps western Canadian farmers by increasing input costs for our surplus producing competitors namely: the US corn belt farmers.

[boarderbloke]

The CWB isn't a monopoly "seller" in the global market place, there are plenty of sellers of wheat in the world, though it is a monopoly "buyer" of wheat and barley in western Canada!
I don't want to sell to a monopoly who sets the price and says if you don't sell to me, then you can keep it in your bin!

[JDGreen]

YES great comparison yukyukchuk. Makes perfect sense to me now that you explained it like that.. Seriously that is the most ridiculous analogy I have heard of in a long time.

[ColevilleH2S]

Yes Canada has what, 3% of the world wheat production and 40-50% of Potash production.

I don't understand the comparison.

How are these numbers even relative??? The only monopoly the CWB has is over Western Canadian farmers.

[chuckChuck]

There are other sellers of potash in the world as well. Under that scenario why does Mr. Wall think that Canpotex increases the price of Saskatchewan potash and royalties? If Canpotex doesn't offer benefits as a single desk seller of potash why do potash producers use it? Are they socialists? Or just pragmatic businessmen who know the value of a single desk?

Regardless of whether you like the CWB or think it does a good job or not, if you want to buy western Canadian wheat, malt barley and durum there is only one place to go. That constitutes a monopoloy seller on behalf of western Canadian farmers and has value in the marketplace.

For examaple in some years, Canada has over 50% of the durum supplies traded in the world and can use this to influence market price by controlling supply and using market discipline just as Canpotex does with potash.

[bigsteve]

When we finally do get rid of the monopoly powers of the Western Canadian Wheat Board---The history books will write that the WCWB was the greatest example of SUPPRESSION in Canadian history.They will write of the tremendous loss of opportunity for western canada agriculture and value added industries.SHAME they will say of our past politicians.

[gregpet]

After the handling of durum over the last few years by the CWB do you really want to use that crop as an analogy?

Some people just follow blindly or like the lemming's will just keep jumping off the cliff because the one in front of him just did instead of thinking for yourself.

[gregpet]

Chuck, do you have any real world numbers to back up your arguement? I am not a lemming so you will need to provide actual numbers for me to believe you.

Will be waiting patiently for your numbers, have been waiting about 40 years for some what's a couple more hours?

[chuckChuck]

Gregpet. The debate about the CWB has been rehashed over and over again. The numbers don't matter to most farmers who don't like the CWB. It comes down to politics and worldview. I get why you and many farmers don't like the CWB. Fair enough. My original point is the contradiction in Brad Wall's position. He and the Cabinet see value in a single desk for potash but not in the value of a single desk for wheat, durum, and malt barley. Why? Why the double standard? Again it has to do with politics. But when free market business oriented premiers support a single desk seller of potash farmers should take notice.

[cottonpicken]

The one scenario im scared of is the god damn indian
bands buying it with our tax dollars.

This is actually being talked about.

[cottonpicken]

-forgot to note pars already brought this up

[sumdumguy]

CWB is an OLIGOPOLY not a Monopoly. They would be a monopoly if they were the only seller or controlling seller of wheat and barley. How do you figure they fit that scenario? Is the CWB big enough to dictate selling price? I beg to differ.

Chuck-Chuck- that's why they can buy at their own arbitrary price from you- they are the only buyer of export wheat and barley. TOTAL OPPOSITE

[gregpet]

Chuck I guess the arguement went along the lines of the east only has a small amount of wheat to export compared to the west blah blah blah. So the single desk was not a requirement out east. Now Sask has 50% of the known reserves of potash, monopoly will more than likely work, not to many other options.

My arguement, on the world stage the CWB controls about 5% of the worlds supply of wheat. Was too small of a market in the east to matter in Canada so I feel the CWB has too small a market share to control the selling price on a world stage. Has been shown by some tenders and sales that the CWB sells for less not more than the world arbitrage price.

So once again show me numbers and I will have no choice but to believe in the single desk, until then don't tell me CWB is the best option back it up by some facts please.

[jdepape]

chuckChuck:

Take a read here:

<a href=http://cwbmonitor.blogspot.com/2010/10/is-this-deal-you-want.html>Is this the deal you want?</a>

and then come back and tell us how the CWB system is working for durum farmers.

Better yet - explain your solutions. Because that's what we really need.