Wheat School: Key Growth Opportunities for Canadian Wheat – Earl Geddes, CIGI

The Canadian wheat industry is changing, especially in the west. The elimination of the single desk is the key factor driving that change. Across the country, everyone involved in the industry is evaluating and strategizing in an effort to determine how this will affect their business and what they have to do to successfully adjust to the change.

According to Earl Geddes, the Executive Director of the Canadian International Grains Institute, that change represents some real growth opportunities for the Canadian industry. Those opportunities will be based on new relationships between buyers and sellers, with a host of niche market opportunities being opened up. I spoke to Earl about those opportunities and where some of that potential for growth exists. The reality is that the future will be very interesting for both Western and Eastern Canada.

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Shaun Haney

Shaun grew up on a family seed farm in Southern Alberta. Haney Farms produces, conditions and retails wheat, barley, canola and corn seed. Shaun Haney is the founder of RealAgriculture.com. @shaunhaney

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3 Comments

Andy

But each individual farmer is going to have to fly to china, india, north africa and europe to meet with the end users to market our grain without the CWB. That will cut into our increased growth opportunities.

(this is a sarcastic statement, that some people I have talked to seriously believe!!!)

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Wayne

The question is how much will be left in my jeans? I don’t see a lot of difference between the CWB or the big Corps!!!!!!!!!!!!1

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Siphathisiwe

In rosepnse to the interview with Mr. Voss I would like to say that I respect his right to have an opinion and follow through on it. Going further to suggest and back up the formation of a new entity seems compromising and an untimely disclosure and misuse of the confidence and representative authority his fellow farmers have delegated to him.With respects to the new entity Mr. Voss is advocating and for clarification purposes does this have anything to do with a similar entity proposed earlier this summer? The Western Canadian Wheat Growers Association, backed by Western Barley Growers Association and Grain Growers of Canada, has set out a proposal for a new CWB. An E-mail I received from Blair Rutter, the executive director of the WCWGA contains a document dated Aug 23, 2011 in which a plan for a voluntary organisation, to be implemented Dec. 31, 2011 is detailed. Through a new CWB act an estimated total of 12 million shares are to be issued to farmers at one share per 10 tonnes delivered grain between 2006 and 2012. Grain other than CWRS will be adjusted to a CWRS equivalent based on average yields. The new entity will assume all liabilities and contractual commitments of the existing CWB including all farmer owned assets. Federal cash advances should come under the administration of a commodity association Canadian Canola Growers Association which has already come to pass.Regulatory powers of the existing CWB should be removed by Aug. 2012. The new CWB will also take over the balance in the contingency fund as of July 31, 2010. Funds in excess of 22.0 million will be distributed pro rata only to farmers using pricing options in 2010/11 and 2011/12 crop year. At the first shareholders meeting, shareholders will elect 9 new directors who will in turn appoint 3 directors.Shareholders will determine if they will allow private investors, and dictate restrictions placed on purchase or sale of shares. This seems out of tune with the whole free market ideology, which WCWGA lobby so strongly for. With regards to shareholder allocation, according to Statistics Canada, Saskatchewan has consistently lower yields of wheat, barley and durum, that being up to 1 tonne per hectare less than Alberta and Manitoba farmers. This would surely compromise the fairness of shareholder distribution. Eventually the new entity will be permitted to “buy and sell any grain without restriction” after Aug 1, 2015.The government i.e. Canadian taxpayers will be guarantor for the new CWB borrowing until Aug. 2015 and assume costs of CWB employee severance pay, contract cancellations and funding of some existing projects. In addition a communiqué from WCWGA, GG of Canada and the WBGA to the Right Honourable Stephen Harper, P.C., MP dated May 12, 2011 states and I quote: “To provide certainty, our organizations are of the view that The Canadian Wheat Board Act should be repealed and replaced with a Grain Marketing Act……. This approach will also ensure the legislation can withstand any possible court challenges which will invariably occur if efforts are made to simply tinker with the provisions of the existing Act.” There is also a request that the government “move quickly and decisively”.I question whether these organizations have overstepped their boundaries.Lastly I think the farmers who own the land base utilized by the commercial farmers Mr. Voss mentioned, should have a degree of influence as they also bear a part of the financial risk.

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