Latest CWB study by PwC

[chaffmeister]

In the study PwC suggests that “....the fiscal 2004 direct costs of $369.7 million multiplied 2.17 times through the economy into over $803.2 million in total activity.

Direct costs are things the CWB pays for to handle and market your grain – freight (above what you pay), terminal handling, storage, inventory financing, and so forth.

What they don’t say is that all this economic activity would occur WITHOUT THE CWB.

They also add as “economic benefit” of “tax generation” from the $369.7 million in direct costs – a total of about $183.0 million. Again – would occur WITHOUT THE CWB.

Also – they add the “economic value of the “premiums” to farmers. PwC indicates the premiums earned are $312.6 million and the economic “impact” is $632.2 million.

They indicate that “These premiums were derived from Performance Evaluation of the CWB, The CWB and Barley Marketing, Price Pooling and Single-Desk Selling Report and Benchmarks to Measure CWB’s Performance as detailed in Appendix A.”

Appendix A is not available on the CWB website – and they aren’t answering requests for it.

There’s other stuff indicating great economic benefit. But it all comes down to (1) economic activity that would occur WITHOUT THE CWB, and (2) premiums that REAL evidence indicates are not there.

To present this in this way – suggesting the CWB is responsible for this economic activity OCCURING – is absolutely and totally misleading. PwC should be ashamed and embarrassed.

[chaffmeister]

My mistake - just found the Appendix.

[chaffmeister]

Ok, now I'm getting ticked....

Study says there are the following:

APPENDIX A – LIST OF INTERVIEWEES
APPENDIX B – GLOSSARY
APPENDIX C – DETAILED ECONOMIC RESULTS
The appendix that you can download simply restates the "results" in tabular form (I assume it's Appendix C).

Yet the study says (in a footnote):
These premiums were derived from Performance Evaluation of the CWB, The CWB and Barley Marketing, Price Pooling and Single-Desk Selling Report and Benchmarks to Measure CWB’s Performance as detailed in Appendix A.

Somehow I don't think a list of interviewees will tell us much about how the premiums were derived.

[AdamSmith]

In the Jan 07 Readers Digest pg 29

Article titled

Healthy Skepticism

Don't believe every sentence that starts with "Studies Show..."

It's about medical studies but quite aptly applies here as well.

Also found the article on the web at todaysparent.com

Here it is:

Uncommon Sense

Healthy Skepticism
Don’t believe every sentence that starts with “studies show...”


By John Hoffman

Are you ever confused and exasperated by conflicting information in scientific studies? Undoubtedly, you’ve read about the health risks of childhood obesity. You might also have heard about a recent study that shows overweight people live longer. What’s a parent to think?

I’ve spent much of my career checking out, deconstructing and, at times, debunking poorly researched or reported scientific findings. But, sorry folks, I haven’t been able to fix the problem: The culture of confusion seems bound to continue. Therefore, as a public service, I’d like to offer Hoffman’s Handy Rules for reading about research in the news media.

One study, on its own, is rarely the final word. Most research is one piece of a big pie — the research literature, expert observations, clinical practice and, of course, human experience. A study usually makes the news because it’s the latest, but being the latest doesn’t necessarily (or even usually) mean it trumps all previous knowledge.

Some health information is presented without relevant context — and mainly to cover someone’s butt. In May, Today’s Parent reported that Health Canada was considering stronger warning labels on Elidel and Protopic, two drugs used to treat eczema, because of worries about cancer outlined in an advisory from the US Federal Drug Administraion. That was factual. However, it turns out that both the Canadian Dermatology Association and its American counterpart disagree with this warning. That’s because the only evidence is that megadoses cause cancer in mice, plus some “case reports in a small number of patients.” Yes, there was some cancer in kids taking these drugs, but it was actually lower than what you would find in the general population.


Page 2: Useful or just shocking?


Often studies are reported because they’re surprising, not because they’re useful. Last spring some media reported on research suggesting that daycare may lower risk of childhood leukemia. Huh? In fact, that study was really about the role that early infections might play in the development of childhood leukemia. Researchers happened to find that kids in their sample who attended daycare twice a week in the — get this — first few months of life were half as likely to develop leukemia. Even if the finding proves important ultimately, no one is going to suggest putting more infants in daycare as a cancer prevention strategy.

A lot of research is done or reported with tunnel vision. People whose primary orientation is prevention of skin cancer will present research that suggests you should keep your kids out of the sun. Those who are worried about vitamin D deficiency might tell you that kids need some unprotected exposure to sunlight. They’re both right, in their own area, but it would be nice if advice givers looked at the big picture once in a while.

There are exceptions to virtually all research truths. Breastfeeding is, on average, more healthy for more babies. But it’s not hard to find a formula-fed baby somewhere who is healthier than a breastfed baby somewhere.

This doesn’t mean that research is useless — nor that scientists are stupid, nor that the media shouldn’t report research. However, research results are only meaningful if they’re put together with what else is known, as well as our personal circumstances. If, for example, your child is taking Paxil (for depression) or Adderal (for ADHD) and you read alarming stories about risks associated with these drugs, take it as information, not advice. Find out more. What exactly is the risk? And to whom? How much is the drug helping your child? Is there an alternative? Any drug comes with a potential risk and potential benefit; stopping the drug has a potential risk and benefit as well. (Yes, some research has shown a connection between certain antidepressants and suicidal thoughts, but untreated teen depression can lead to suicidal thoughts too.) You always have to weigh one against the other.

So next time you read a news story that challenges one of your sacred truths, don’t panic. Read carefully, read between the lines and get more information.

[craig]

The only thing new in this report is an economic model to try and see how many ways we can multiply economic value. No doubt there is a huge market out there of people trying to justify their position or strengthen their case. Some interesting quotes from the study. my favorite
"the CWB has become a major anchor of Canadian farm and economic Policy."

" Companies are more likely to market grain as commodities with limited incentive to market branded products"

"All returns less marketing costs are returned to producers"

" The single desk provides higher and more stable returns to farmers each crop year"

" CWB PPO's provide risk management at lower costs than brokerage firms"

[chaffmeister]

Craig:

I like the one about companies having “limited incentive to market branded products”. It goes very well with another quote from page 39 of the same study:

• ADM Milling (Canada) identifies flour bags destined for Asia with an image of wheat stalks and the slogan “Canadian Wheat is Best.”
• Pasta maker Danuta in Poland advertises its high end Malma product line as being made with 100% Canadian amber durum.
• Tsingtao beer, bottled by China’s largest brewery, is marketed in their web site as containing at least 50% Canadian malting barley.
• Mister Donut shops in Japan placed waxed sheets advertising No. 1 Canadian Western Red Spring Wheat on customers’ trays as part of a three-month promotion.

I also laugh every time I read:
" CWB PPO's provide risk management at lower costs than brokerage firms"

Let’s see:
PPO discount for risk: $5.00 a tonne
Brokerage firm fees: $0.50 a tonne
CWB propaganda: priceless