The CWB in an Open Market

[$short]

I hope the CWB can survive on use and value that it provides me on Aug 1, 2012. It may develop a model that can be quite competitive and if I like it maybe we will use it, who knows.

If the CWB directors don't start planning soon on how to function without a legislated monopoly and stop trying to prevent the change from happening we may never get a chance to find out.

[charliep]

I guess why I put questions about the marketing process (mechanical) and where the CWB adds value and from there can it attract partners in the supply chain outside a legislated framework.

Perhaps a really dumb question but why are we having this discussion now - 5 years after the last CWB near death experience. The move to an open market has started a long time ago even for the CWB. I again highlight the product/programs the CWB has offered over the past 10 years including one forgot - malt barley cash plus. Changes have only occurred because of crisis - not planning.

Even the contingency fund. The need has been recognized by the CWB for years. Would have required a change to the CWB act. Has anyone talked about this? Why not?

[Burbert]

The CWB exists causa the Act. The
Reformees kin kill it, any time they want
now, cause theys a majority. The
gobermont has their spies in the CWB and
control the purse strings. Farmers have
controlled the CWB for sometime now cusa
the majority of directors, butt nope
farmers don't determine its destiny. That
was BS the whole time it was being
pitched.

[charliep]

Just seems strange to me to tell me in one sentence the CWB farm owned/controlled and the CWB finding power/control in legislation passed by parliment and supported via government guarantees. Even you will tell me that without legislation, there will be no CWB.

A case study for you. I am a 40 year farmer with a young family. I like elements of the CWB (many of which are in the topics I highlighted in the first posts) but there are other aspects where I struggle with the current programs/services as relating to the my farm and my financial situation. In the CWB surveys, I have indicated support for a dual market or some hybrid of CWB/open market. People have told me for the 10 years I have been farming this won't but I have steadfastly indicated my desire for change. What is your vision for a CWB that will meet my business first and foremost but provide a high probability to have a viable CWB as a provider of services (secondary importance)?

[charliep]

Would note the CWB is looking at 10 ish alternatives for a re-newed. 4 or
so in a open market. I assume one status quo. That leaves 5 alternatives
for something a different type of CWB. Any idea what these ideas might
be? Would you have any feedback for what they should be if not open
market scenario? What criteria will they use to judge the different
alternatives? Why criteria would you use as a farm manager based your
business needs?

[TOM4CWB]

Charlie,

The CWB has always operated in the 'open market'. Buyers of our board grains have always operated in an open market... and were free to buy grains from anyone else outside the CWB designated area... any time they wanted to.

The CWB strategy... that they can ONLY market grains they can confiscate... through the 'single desk' 'monopoly' that only exists... because the CWB directors have kept the price of CWB grains LOWER for growers... inside the CWB designated area; than prices outside Canada... (the requirement to extract the 'pecuniary benefit' enuring the applicant and the then price difference between the price inside and outside Canada)

Should make any CWB grain growers hair stand on end!!!

The monopoly exists to serve only the CWB... by the CWB extracting value from western Canadian grain growers... and obviously not returning it to those growers who would seek higher prices outside Canada.

HOW crazy is this? How can the present CWB ever hope to operate in a market place... where they must instead provide value and premium prices to growers who sell the CWB grain? This is opposite to what is happening now... simply by structure and function!!!

So Oberg/Agstar77 and Burbert have said... the only way the CWB can continue marketing grain... is if they can confiscate our grain...

without fair and full compensation for that grain.

We are told... this right to confiscate our grain... without fair compensation... is the ONLY asset the CWB has today.

So Charlie... how can the Future CWB operate... if they (the CWB)are no longer allowed to take our grain without paying Fair Market Value?

How would Oberg and the other special left wing communist directors at the CWB possibly proceed?

SUE PM Harper and Ritz... for taking away the only asset the CWB has now... POOLING grains and keeping farmer prices lower than international grain prices OUTSIDE the 'designated area'.

They believe at the CWB there is no other choice.

[charliep]

Actually the new world will change all three pillars of the CWB - price
pooling, single desk and government guarantees. Of these three
principles, a change to legislation will be about single desk - farmer
will have the choice of several buyers of their wheat versus just one
today (export and domestic food) in western Canada.

A challenge (opportunity for creative thinking) is explain exactly how
the new world of multiple buyers including the CWB will work. I don't
understand and don't know the bogey man but I do know the elements
of a sale and the different roles groups in the transaction process play.
The CWB today has a role but is not the only player. Most things will
occur exactly as they do today with the exception farmers can shop the
market for the best price and will be more subject to price volatility
(may not get an average price). Other members of the supply chain also
use CWB services and their needs will have to be addressed. The CWB
board of directors/operations needs to define its strenghths and role in
a open market.

[hedgehog]

if the cwb is forced to pay market prices for wheat to western canadian growers, the value of land there will rise i think.
If that happens, where will the next lot of evicted scottish farmers go for cheap land they can afford?

[charliep]

I suspect there will still be land for sale and that Scottish farmers that move to Canada and want to grow wheat will still be able to regardless of what happens August 1, 2012.

Actually a great opportunity for Europeans to come here. You likely already know but the average age of farmers in Canada is in the 57 to 59 year old range. Will be a lot of land changing ownership (or at least the individual or type of busines farming) in the next 10 years. A long ways from the thread topic but will impact the direction of the CWB/grain marketing over time.

Tongue in cheek but I note an expression in Canada is if you believe that, then I have some swamp land to sell you in Florida. Closer to home these days as the new swamp land is in eastern Saskatchewan/Manitoba. All farms are ruled by Mother Nature.

[charliep]

My own worst enemy for taking threads off topic but if I was a Scottish farmer considering immigrating, I would have a look at demographic information for farmers in Western Canada. The CWB does an annual survey of their stakeholders (permit book holders) which will be released this month and the make up of this survey reflects the demographic characturistics of farms here and their attitudes. They can break this survey down by province, age, size, use of CWB, etc. Only release the demographic breakdown on a limited basis but as an economist, would be very interesting to look at all the data.