Selling to the US without the CWB

[almoy]

If we get rid of the CWB how long do you think the US farmers are going to put up with a long line of trucks from Canada to the US ? I would imagine it wouldn't be long until tariffs were in place. They are not going to stand for the Canadian farmers flodding their markets. We cannot market ALL our grain through the US.

[Kasro]

almoy

What makes you think there will be a long line of trucks delivering wheat to the US just because the CWB no longer exists?

We have an open border for canola, flax, oats, sunflowers, peas, lentils, chickpeas, mustard, soybeans, corn......and trade occurs, or does not occur, on the basis of the needs of sellers and buyers. There are no protests by the Americans over these products.

[almoy]

All the crops you just mentioned are not grown in the US to the extent that wheat is. Ever spent much time on the US sites. The farmers strongly object to Canadian wheat and Durum coming across the border. I don't think the Canadian farmer will be allowed to haul as much as he wants and whenever he wants to the US for very long. That is not how their Free Trade works. The US government will listen to their farmers.

I just don't think all the grain will move into the market at the lucrative prices some have been posting just because we get rid of the CWB. It seems to me we heard the same story about how much better off we would be without the Crow Rate. NOT !! It may not have affected Alberta that much but it sure has not helped Saskatchewan.

[parsley]

1. Don't try to let on as if the only way we can get into the USA is if we get rid of the Wheat Board! We don't need to get rid of the CWB in order to get into other countries; it can stay where it is and just as it is.

The only thing that needs to change is that Directors like Art Macklin need to sit at the Board table and be willing to make a motion ordering the Licensing Department to issue no-buyback export licenses to any Designated Area farmers needing one. The rest of the Directors would need to pass the motion. The way it works right now is that directors like Macklin, with the exception of Chatenay, are keen to grant licenses to every Tom, Dick and Harry across Canada, EXCEPT to farmers on the Prairies. So what good is it to have a farmer like Macklin sitting on the Board when all he does is work to see that every farmer from the West cannot get an export license?

2. You seem to think farmers only want to ship only into the USA, but that is not true. Farmers would ship to other countries if the the Board of Directors would allow Designated Area farmers an export license for shipping grain to North Africa, or to New Zealand, etc, but instead, they have chosen to discriminate against prairie producers and deny them licenses.

The US isn't the only place in the world Prairie farmers have tried to export into. The Board of Directors could change that in a conference call in three minutes.

Parsley

[Everest]

Almoy, there are at least three areas where I think your conclusions are proceeding on the basis of some wrong assumptions.

First. I don’t perceive a move to “get rid of the CWB”. What I see and hear from farmers is that they want a choice of where they can market their wheat and barley, INCLUDING the CWB. Eliminating the CWB’s single desk authority, and eliminating the CWB entirely, are two different things. I have not heard of anyone advocating closing down the Board entirely.

Second. The only reason wheat would move in “a long line of trucks” to the US is if the price is higher there. But there is no reason why the price in the US would be higher than in Canada. Wheat trades on the international marketplace, and the price is the same everywhere, with the only difference being transportation costs. Its called arbitrage. Wheat prices in Canada would be, and in fact are, the same as prices in the US, just like they are in all the commodities Kasro listed.

Third. I have spent a considerable amount of time reading and talking to US farmers and their organizations. When you understand their position, it is not Canadian wheat or Canadian farmers that they have a quarrel with. It is with the single desk/monopoly of the CWB. The point they make is that the CWB can sell into their markets, and be assured of supplies because they don’t have to go to the market and compete for it. In their view, the CWB's guaranteed supply gives them pricing and selling latitude that they would not have if they had to buy their supplies competitively. I would have to say that I can’t disagree with that premise, nor would most market participants and observers. Is it worth jeopardizing our access to the US market just to preserve the CWB’s “monopoly”? Especially when a majority of Canadian farmers would prefer a voluntary CWB anyway?

So with respect, Almoy, I think you have been a bit caught up in the fear mongering that goes on, mostly aided and abetted by the CWB itself. Why they lack self-confidence to compete on an equal footing with other buyers I don’t understand, but they do. Their actions make it look like they are more interested in protecting the status quo and their jobs, than in providing farmers with marketing and business choices and opportunities.

The bottom line is this. Some farmers want to sell their wheat to the CWB and participate in a price pool. That is perfectly legitimate. Others want to sell direct, process and add value to their production, or maybe even hire the services of a marketer they have more confidence in. That is legitimate too. The only way to give everyone what they want is to make the CWB voluntary. It is no longer acceptable to force farmers into a marketing scheme that they don’t want to be in, especially when it doesn’t deliver higher prices and stifles investment in value adding.

[ianben]

I guess there must be a good way and a bad way to reform/destroy a marketing board system.
In the UK we have lost both milk and potatoe boards which were seen in similar light to the comments here.

Neither has given the guys who voted to remove them their expected result, a better future.

The MMB(milk) which resembled your CWB with pooled prices and nearly total single desk selling.

This was disolved in a similar way to that described here. A dual system were the cherry picking is allowed along side a pooling system This has seen prices crash to the point where today in the Farmers Guardian supermarkets are trying to pay 2p/litre MORE for milk if the middlemen will pass it ALL down the chain to the farmer.

Even they see that todays farmer price is unsustainable and they obviously fear for their future supplies as more and more farmers are forced to retire from milk production.

The farmers where the cause of their own destruction by competing on price but as individuals they had no choice.

The middlemen have not made a killing either the only real winner to date has been the consumer who is getting very cheap milk.

Your CWB looks in need of some changes but please be careful it will affect me too in this global marketplace.

Tom says you made a good job with your hog board are there any lessons there?

[parsley]

Ianben,

Perhaps you have not been reading thoroughly.


You make it sound as if Western farmers wanting "A dual system were the cherry picking is allowed along side a pooling system", are citizens who are dullards trying to implement a NEW system, one that isn't in place.

That's not true, and I think we have been very clear in defining to all Agri-villers that there are already MULTI dual marketing systems in place in Canada, co-mingling with the CWB, yet operating independently from the CWB.

All the separate marketing systems in place and working, function well within the Act provided to the CWB, function well with the Act provided to Ontario Wheat Marketing Board, function well with the entire Creston-Wyndell region in BC that opted out of the Designated Area, function well with the Corporations who have been released from the pooling obligations and function well with the hundreds of other farmers across Canada who bypass CWB marketing and pooling.

There is nothing new here from Westerners asking to bypass the Board, only more of the same that already exists.

I am quite sure that a farmer's ability to market along side the Board instead of being forced to accept the Board to market for them will have a profound effect upon any country buying grain from the CWB, but it will have no efffect upon Board marketing. The Board has indicated that neither price NOR volume affect Board marketing. The Board is not obligated to get the best price, but, as the Act states, what is considered "reasonable". A few more producers opting out will have NO effect upon the Board, but the producers opted out will have an effect upon buyers.


Parsley

[ianben]

Parsley
Perhaps cherrypicking was the wrong word but the same arguments were used by some milk producers as I am reading here about CWB.
Taking advantage of their location or marketing ability you may prefer.
The words dont really matter so long as new system does not result in too much competion between farmers as happened here.

Just reporting facts here in UK that might help. No offence intended!!

[parsley]

Ianben,

You say:
"The words dont really matter so long as new system does not result in too much competion between farmers as happened here." , but my point is there are already all kinds of competition between farmers in Canada. There is no single marketing desk in effect in Canada. Ontario has it's own marketing, as does Quebec, Nova Scotia, N.B, etc. Those are provinces...NONE of them lie under the single desk Wheat Board blanket.

In BC, one area that was under the single desk blanket decided they didn't want to be and they were awarded export liceses and could bypass the CWB marketing.

In the prairies, many different groups have decided to bypass the CWB's single desk cravings, and these exemptees do not market nor pool their grain through the CWB even though they qualify to be under the single desk blanket. They rejected it and were accomodated.

Many of us on the Prairies have also rejected CWB Board marketing and pooling, and have asked that that rejection be reflected by freely given permits. Why is our request suddenly categorized as too much competition, while the other requests were nicely accomodated?

Parsley

[JD_GREEN]

Parsley,

you make excellent comments and sorry ianben but I as well see nothing relevant about your argument. PARSLeY FOR CWB DIRECTOR!!!!!!

[TOM4CWB]

Ianben,

Let us go back to straw merchandising.

I know what a fair price for straw is.

And so do you...

I will sell my straw for less than many of my neighbours this year...

simply because I have developed a long term relationship with my market.

Now, we both need to grow and merchandise our products so the people we market to can make ends meet, and we ourselves can be consistant long term dependable suppliers, which is what our market needs.

Greed is the fastest turn off for any customer in my market...

And the simple statement that the CWB depends upon... "extracting" a "premium" from our market really stinks!

If the products I grow are worth a premium, then I will expect a premium...

And the only way to procure this premium, is to be a great salesperson... and to know the market!

Now if the "single desk" doesn't have all their ducks lined up...

It can really reck the market, and have really had a depressing effect, even on your markets Ianben.

The biggest reason this happens, is cause the CWB doesn't know what the needs of specific creators of their products are...

The biggest need for many is to be appreciated, respected, and feel a part of a community that is creating positive situations for our families!

We have big problems with potatoes... and our Milk Boards have sold all their processing facilities...

Hope we can all learn from others mistakes... and choices usually cost...

So we must expect to pay for our freedom, which is only fair!!!

[ianben]

I am not saying the status quo with your board is acceptable.
It obviously stinks.
However I still see similarities with our milk board.
Local groups set up to supply demand for specific companies like our local straw sales.
In some cases the whole chain has failed trying to maintain farmer price at sustainable levels.
It is difficult for individual farmers in my opinion to give promise on supply and quality and I dont see how individuals can be expected to know the whole world market.
I think most of us need some sort of expert help when it comes to knowing what a guy in Japan is prepared to pay and what are his requirements.
Grain traders are fine but their priority lies first at home then their customer an then with lots of individuals who must be a pain in the arse with there obscure selling patterns and inability to always meet required spec.

Still just reporting facts here in UK

Supermarket offers 2p/litre more on condition it all goes to farmers is not the headline the farmers were expecting when they voted the board out.

Milk was 23p when board went. Went up to 27p as predicted by the advocates of removal and has fallen ever since.

Now 14p so this extra 2p will give the wonderful price of 16p!!!

[TOM4CWB]

Ianben;

Obviously on the milk, the supply must have increased from somewhere!

I know with the hog producers, they have a choice...

They can produce contract hogs, making a small but consistant profit... or they can gamble on the cash market...

On the contract hogs, a feed component is included in the price, so if feed cost increases, so does the market price!

Now, this is the kind of innovative initiative we need with a marketer!

But obviously when a contract is working between two parties, neither one will get rich over night, plus trust and reliability must be part of the situation!

How do we get to this situation?

Commitment, trust, reasonable rate of return, and most of all respect for each other!

Ianben... the CWB never has had control of fixing supply, unlike most other marketing boards...

The only statutory obligation the CWB has is to market the grain offered to the CWB in the authorised manner stated by the CWB Act.

If the government of Canada did what they said they were supposed to do when they started the CWB as a market stabiliser, then it would be different.

The CWB was to supply you folks in the EU, wheat.

Wheat at a reasonable price, to help you and farmers alike, through a stable and "fair" 5 year international wheat agreement!

Now the stable "fair" agreement is gone... and "designated area" farmers are stuck with a marketer who would rather call in customs agents, and send folks to jail.

Rather call in customs agents, and send folks to jail, than respect and honour those who they were supposed to support and share burdens with!

Why is it so imposible to get the cash price that the CWB gets each day...

Unless the CWB knows this revelation will insure the CWB's death itself...

It is forsure something stinks, and this time it is not in Denmark... it is in 403 Main, on the 3rd floor in the sales dept. and connected, in our PM's and CWB Minister's offices!!!

[almoy]

In the area where I live the majority of the farmers are quite happy selling their grain through the wheat board. As some farmers say they have enough headaches marketing their pulse crops that it is nice to have one crop that is looked after for them.

I also like the contracting system that allows everyone to sell a percentage of what they grow. On a year of oversupply it allows all farmers an EQUAL advantage to sell some wheat. But then I like to see my neighbour survive too. I don't want to be the only one for miles out here.

[parsley]

Almo,
These are some Saturday morning thoughts for you.

Equality is the political thought that dominates some areas in Saskatchewan. We've listened to the equality-above-all-else philosophy for decades. But how does your political idea of equality translate over the years?

Well, Don Mitchell states in his book called the Politics of Food, explains how "..measures such as the Canadian Wheat Board and the Price Stabilization Act in 1944 were aimed at keeping prices down for farm commodities. The price of farm commodities advanced over 17 per cent from 1949 to 1970 with the price of wheat virtually frozen from 1945 to 1972. Farm income had to come from increased volume if they came at all"

In other words, your concern is that ALL farmers get an equal share of low wheat prices. Your concern is that some greedy farmer doesn't get just a little more than you do, "doesn't cherry pick", like Ianben and thalpenny constantly fret about, because that would cause you such anguish. You would not mind that from 1945 to 1972 prices stayed low, that there was no increase in the price of wheat, because you got your "fair share" of the stagnant price!

Wheat income didn't rise from '45-'72, but Saskatchewan wheat farmers in your area, would be satisfied as long as nobody else got more money than they did.

Well, flax increased in price, even though wheat didn't. Maybe a few farmers negotiated themselves a few dollars more, and were looked upon as greedy by those particular farmers in your area, but the fact is flax prices did rise in that period, while wheat did not. And that meant higher prices for every farmer.That meant more dollars in every community. Maybe not equal prices, but higher prices. And although you may find this concept difficult to accept, Price Hiking Farmers like to see their neighbors survive, too.


The same can be said today for canola, where the Believers in the Equality of Price, en masse, abandoned growing the very wheat which they claimed insulated them in an economic quilt of equality, and began growing canola. Because they chased the money. And there is nothing wrong with wanting money. To educate our children. To go on holidays. To eat well. Wealth creation can provides us with new money and more money, while the the politics of equality often reflects envy.

Parsley