Events leading to establishment of the first CWB:
The first Canadian Wheat Board (CWB) was formally established, under the authority of the War Measures Act, by P. C. 1589 on July 31, 1919 (Wilson, 1978). The Board concept originated in Australia where it had been implemented in 1915 in connection with wartime policy of that country. The Canadian experiment was first set up as a one-year temporary organization in 1919, in response to the British government’s cornering of the Winnipeg wheat futures market and the closing of that futures market. On July 15, 1920 trading resumed at the Winnipeg Grain Exchange, which had been closed a year earlier in conjunction with the establishment of the CWB.
Events leading to creation of the second Canadian Wheat Board(s)
In the early 1930’s the federal government, in order to support wheat futures prices, purchased and held wheat futures contracts. It found "that it could not sell the futures later in the crop year without unduly depressing the market," and, ". . . by the spring of 1935 it held futures contracts roughly equivalent to the total quantities of wheat in storage in Canada." (Wilson, 1979, p.98) The federal government realized the futility of its attempt at price support policy. "Depression, as well as war, had created abnormal conditions under which the futures market could not operate satisfactorily" (Wilson, 1979, p.97). There was continued pressure from producer organizations to reconstitute the CWB and the CWB was temporarily recreated in 1935.
In 1938, the Turgeon Commission recommended the Government, under normal conditions, should remain out of the grain trade. (Royal Grain Inquiry Commission. Report. Ottawa, 1938 quoted in Wilson 1979). The large imbalance between world wheat supplies and world demand and the possibility of war were the reason given for not immediately dissolving the CWB.
The 1935 CWB was not compulsory and it operated a voluntary wheat pool until 1943. During World War II, the demand for grain raised prices, and in 1943 the CWB was made compulsory to help control inflation. The CWB was then retained after the war because most of Canada’s wheat was exported to Britain under a bilateral agreement, and the CWB made administration of the agreement much simpler (Fowke, 1957).
Rotstein (1984) convincingly argues the rationale for CWB creation was the same as other Canadian public corporations, a response to major forces from outside the sector that are to a large extent, uncontrollable. The Liberal government in the late 1930s, and early war years, was committed to terminating the CWB in favor of the open market but external forces-the culmination of the depression effects and the "extraordinary issues of the war effort" lead to creation of the Board. "Hence the genesis of a crown corporation by a government that did not want it" (Rotstein, 1984).
http://www1.agric.gov.ab.ca/$department/deptdocs.nsf/all/agc2251
The first Canadian Wheat Board (CWB) was formally established, under the authority of the War Measures Act, by P. C. 1589 on July 31, 1919 (Wilson, 1978). The Board concept originated in Australia where it had been implemented in 1915 in connection with wartime policy of that country. The Canadian experiment was first set up as a one-year temporary organization in 1919, in response to the British government’s cornering of the Winnipeg wheat futures market and the closing of that futures market. On July 15, 1920 trading resumed at the Winnipeg Grain Exchange, which had been closed a year earlier in conjunction with the establishment of the CWB.
Events leading to creation of the second Canadian Wheat Board(s)
In the early 1930’s the federal government, in order to support wheat futures prices, purchased and held wheat futures contracts. It found "that it could not sell the futures later in the crop year without unduly depressing the market," and, ". . . by the spring of 1935 it held futures contracts roughly equivalent to the total quantities of wheat in storage in Canada." (Wilson, 1979, p.98) The federal government realized the futility of its attempt at price support policy. "Depression, as well as war, had created abnormal conditions under which the futures market could not operate satisfactorily" (Wilson, 1979, p.97). There was continued pressure from producer organizations to reconstitute the CWB and the CWB was temporarily recreated in 1935.
In 1938, the Turgeon Commission recommended the Government, under normal conditions, should remain out of the grain trade. (Royal Grain Inquiry Commission. Report. Ottawa, 1938 quoted in Wilson 1979). The large imbalance between world wheat supplies and world demand and the possibility of war were the reason given for not immediately dissolving the CWB.
The 1935 CWB was not compulsory and it operated a voluntary wheat pool until 1943. During World War II, the demand for grain raised prices, and in 1943 the CWB was made compulsory to help control inflation. The CWB was then retained after the war because most of Canada’s wheat was exported to Britain under a bilateral agreement, and the CWB made administration of the agreement much simpler (Fowke, 1957).
Rotstein (1984) convincingly argues the rationale for CWB creation was the same as other Canadian public corporations, a response to major forces from outside the sector that are to a large extent, uncontrollable. The Liberal government in the late 1930s, and early war years, was committed to terminating the CWB in favor of the open market but external forces-the culmination of the depression effects and the "extraordinary issues of the war effort" lead to creation of the Board. "Hence the genesis of a crown corporation by a government that did not want it" (Rotstein, 1984).
http://www1.agric.gov.ab.ca/$department/deptdocs.nsf/all/agc2251
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