sent this out as an Op Ed piece will be interesting to see what media does pick it up.
The lack of credible information and honest representation of farmers from the CWB “group of 8” has now clearly gone against who they claim to represent– farmers of western Canada. Statements regarding the recent increase to the CWB’s contingency fund once again point to the seriousness of misleading information being promoted by this group of 8.
As a former board member, the board submitted a request to Minister Ritz in the spring of 2011 to increase the ceiling of the contingency fund to $90 million. This initial increase was made for crop year 2010/11 and since then it became apparent that another request would be needed to ensure the amount allowed into the contingency fund would accommodate the 2011/2012 crop year.
These funds are generated when farmers sign up to use the PPO’s (producer payment options) and are fees for risk management to ensure the fulfilled of contractual obligations. The programs were introduced due to a call from producers for the ability to market their wheat or barley outside of the pool accounts. These programs attempt to mimic an open market while maintaining the single desk status of the CWB. Substantial use of these PPO programs shows that producers understand and accept that a basis that includes fees for risk and administration is the cost of doing business in the PPO programs. With that being said, it should be fully acknowledge that any excesses or profits incurred by the CWB in their execution of those contracts belong to the CWB. This is really no different than if a producer signs any commodity contract with any other player in the grain trade in western Canada.
Since these are not transactions done in any of the pool accounts, there should not be a transfer of excess funds from the contingency fund into the pool accounts. Any suggestion that the excess in the contingency fund should go into the general pool accounts is false and goes against the policy in place that the board of directors and management has accepted and supported all along. The funds generated are the property of the corporation (the CWB) and must be protected from the group of 8 who show contempt for producers who participate in PPO programs.
It can be argued that the costs associated with these programs are excessively high. However, due to serious losses the CWB incurred in the PPO programs back in crop year 2007/08 changes to how the CWB administered the PPO program had to be implemented. Increasing the fees for risk management was prudent to ensure that there would not be a repeat of the losses experienced in the 07/08 crop year. With marketing freedom, no doubt the CWB will have to adjust the options offered to farmers to make them more competitive with the grain trade.
As to the excessive television, internet, print media focused on eastern Canada - even passing post cards out in Toronto subways - once more goes to prove that this group of individuals is not focused on representing western Canadian farmers. Contrary to what the group of eight has suggested, the board did not hold a vote to allocate $ 1.4 million dollar for the ad campaign. Taking extreme liberties with board decisions shows how dysfunctional these eight directors have become. And furthermore it shows how they have broken the code of conduct directors of the CWB are supposed to follow. It’s time to move forward. It is time to allow our farms, business; communities have a strong future in all aspects of agriculture.
Jeff Nielsen
jeffniel@platinum.ca
The lack of credible information and honest representation of farmers from the CWB “group of 8” has now clearly gone against who they claim to represent– farmers of western Canada. Statements regarding the recent increase to the CWB’s contingency fund once again point to the seriousness of misleading information being promoted by this group of 8.
As a former board member, the board submitted a request to Minister Ritz in the spring of 2011 to increase the ceiling of the contingency fund to $90 million. This initial increase was made for crop year 2010/11 and since then it became apparent that another request would be needed to ensure the amount allowed into the contingency fund would accommodate the 2011/2012 crop year.
These funds are generated when farmers sign up to use the PPO’s (producer payment options) and are fees for risk management to ensure the fulfilled of contractual obligations. The programs were introduced due to a call from producers for the ability to market their wheat or barley outside of the pool accounts. These programs attempt to mimic an open market while maintaining the single desk status of the CWB. Substantial use of these PPO programs shows that producers understand and accept that a basis that includes fees for risk and administration is the cost of doing business in the PPO programs. With that being said, it should be fully acknowledge that any excesses or profits incurred by the CWB in their execution of those contracts belong to the CWB. This is really no different than if a producer signs any commodity contract with any other player in the grain trade in western Canada.
Since these are not transactions done in any of the pool accounts, there should not be a transfer of excess funds from the contingency fund into the pool accounts. Any suggestion that the excess in the contingency fund should go into the general pool accounts is false and goes against the policy in place that the board of directors and management has accepted and supported all along. The funds generated are the property of the corporation (the CWB) and must be protected from the group of 8 who show contempt for producers who participate in PPO programs.
It can be argued that the costs associated with these programs are excessively high. However, due to serious losses the CWB incurred in the PPO programs back in crop year 2007/08 changes to how the CWB administered the PPO program had to be implemented. Increasing the fees for risk management was prudent to ensure that there would not be a repeat of the losses experienced in the 07/08 crop year. With marketing freedom, no doubt the CWB will have to adjust the options offered to farmers to make them more competitive with the grain trade.
As to the excessive television, internet, print media focused on eastern Canada - even passing post cards out in Toronto subways - once more goes to prove that this group of individuals is not focused on representing western Canadian farmers. Contrary to what the group of eight has suggested, the board did not hold a vote to allocate $ 1.4 million dollar for the ad campaign. Taking extreme liberties with board decisions shows how dysfunctional these eight directors have become. And furthermore it shows how they have broken the code of conduct directors of the CWB are supposed to follow. It’s time to move forward. It is time to allow our farms, business; communities have a strong future in all aspects of agriculture.
Jeff Nielsen
jeffniel@platinum.ca
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