selling verses collecting

[charliep]

Thanks Tom4cwb for updating.

I note your comments about protection for forward contracts. What are others thoughts on this issue?

Just to note the comments from people who have involvement in different farmer organizations in this thread. I note there is general understanding of the issue and a willingness to review alternatives.

[wmoebis]

anything in the works that anyone knows of for end user feed grain. How can these guys and us producers protect ourselves? Some big intensive livestock opperators have a lot out on the books at one time and lots can happen in short order.

[TOM4CWB]

wmoebis;

I will take a run at this problem:

The Canada Grain Act in it's purpose states:

"Objects of the Commission

Objects
13. Subject to this Act and any directions to the Commission issued from time to time under this Act by the Governor in Council or the Minister, the Commission shall, in the interests of the grain producers, establish and maintain standards of quality for Canadian grain and regulate grain handling in Canada, to ensure a dependable commodity for domestic and export markets.

1970-71-72, c. 7, s. 11.

Functions of the Commission

Functions
14. (1) Subject to this Act, the Commission shall, in furtherance of its objects,

(a) recommend and establish grain grades and standards for those grades and implement a system of grading and inspection for Canadian grain to reflect adequately the quality of that grain and meet the need for efficient marketing in and outside Canada;"

Here is the official contact:


Contact
Fred Hodgkinson
Manager, Licensing
Telephone: 1-204-983-3309
Fax: 1-204-983-4654
Email: fhodgkinson@grainscanada.gc.ca

Now comes the excuses the CGC uses for not licensing Domestic buyers:

1. It has been argued that intraprovincial (trade of grain within the province) of produce that you grow, is a product of Agriculture within the province... constitutionally an issue not properly within the "Trade and Commerce" provisions constitutionally.
Theoretically the CGC and CWB only operate in "Interprovincial and Export markets" because of this factor.

2. Now comes the restricitive discipline of the CGC and CWB Acts, that one "normally" reading into them the "ordinary" meanings of the words, in which these two acts SHOULD mean that the buyer of your grain must recieve a license and provide you a bonded purchase opportunity. THE CWB Act providing for "Orderly marketing" certainly would ordinarily mean you should have been offered this opportunity.

AND it in fact COULD mean this, and did in fact mean it some 40 years ago. For instance the CWB then took total control over quota's on the intake side of intraprovincial feed mills. This control was sustained in Court Action and ruled legal.

The practical side:

The CGC/CWB duo have not been freindly at all to sellers of domestic feed grains.

CWB pricing is often 10-30% below what is offered direct in the domestic market... a principal reason you did not sell to the CWB in the first place.

If in fact, the CWB were truly doing it's job... of "orderly marketing" they would arbitage the domestic and interprovincial/export market. THis would be a VERY blunt marketing tool.

We as farmers have decided we do not want the CWB in this realm.

You ask how?

Simple... we sell outside of CGC/CWB parameters... and allow them the exemption.

But how could we "Force" the CWB/CGC duo into the principal in the domestic market place?

Simple, we would need to sell, by choice, all our feed grains to the CWB through licensed and bonded CGC dealers... then the domestic feed user would have no choice but to retrieve feed grain supplies from them.

Sorry, but we farmers ourselves are responsible for this mess!

And obviously there is no short cut... no easy profit... no risk free answer that extracts the maximum price for the grain farmer.

THis is the true ironic part of CWB retoric. The CWB says one thing but does the opposite!

As Dr. Soon-Bin Neuh said last Friday to the CWB directors, and shared with everyone in Saskatoon at the CWB Day:

The CWB cannot be a Priest and a Playboy at the same time.

Yet they pretend... and we all pay a massive price... for this deception.

3. In fact innovative leadership could provide you, wmoebis with a high return CWB/CGC assured return for your domestic feed grain sales... if they chose to truly maximise our returns as feed grain producers.

BUT wmoebis;

Do you think they have any intention of doing this?

Do you think the CWB Minister would allow this?

NO WAY.

The result is, We have the worst of both worlds.

Finally:

Don't be decieved: Being offered something for nothing; usually means it costs you extra to get nothing in the end!

A perfect discription of the CWB "Single Desk"!

And you can quote me! TOM4CWB

[charliep]

wmoebis

From the perspective I see at AAFRD, we are not getting the pressure for change/bonding on the feed grain side that we are from the pulse industry. I don't know if a neighbor to neighbor transaction and people want to keep government out or what. I have to seek advice.

The issue from the buyer side has always been the cost of bonding/letters of credit. The CGC/others have been looking at lower cost alternatives. There has also been the insurance concept where the seller pays a cost but again hasn't seemed to be popular.

Finally use of brokers/marketing representatives. The industry is very small and information flows freely (particularly issues around buyers in financial trouble). The individual/company you are working with should be tuned into this (assuming they are working for your interests) and provide feedback. I am assuming a broker who works for a fee and not a re-seller/someone who takes ownership of your grain. Not perfect but a system that works reasonably well.