Time for marketing change at the Canadian Wheat Board

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For the past few weeks the Prairies have been abuzz; not from the sounds of farm equipment, which is an unfortunate reminder of the lasting effects of this year’s flooding, but from a steady back and forth over the future of the Canadian Wheat Board’s (CWB) monopoly.  The Board’s single desk versus the desire of farmers to market their wheat, durum and barley outside of this marketing structure is not a new debate. It has taken time for the federal government to finally follow through on its promise to give farmers the ability to voluntarily participate in the CWB. It was good to see all western provinces fully support marketing change at the CWB.

Well, almost. Manitoba’s refusal to join British Columbia, Alberta and Saskatchewan in their support of the federal government’s intentions to give farmers the marketing choice they desire is another sign that the province is moving further away from the new West. Although Manitoba has been slow to follow the rest of the West on numerous fronts—by not joining the New West Partnership Agreement for example—its recent stance on the CWB is a good example of how politics, rather than the opinions of those who truly matter, is dictating the provinces’ position.

A 2010 CFIB survey found that 84 per cent of its Manitoba farm members want the option to market their wheat and barley outside of the CWB—up from 70 per cent support in 2006—with 73 per cent saying marketing change would have an overall net benefit to their farm business.  Let’s be clear—-our farm members have never advocated for the complete dismantling of the CWB: in fact, 59 per cent say it is very or somewhat important for the CWB to remain a marketing option if alternatives to the CWB are introduced.

There are, however, some very compelling reasons why farmers seek change. Producers tell us they are not getting clear, transparent and timely marketing signals from the CWB and its myriad of programs like Producer Payment Options and CashPlus. For example, 59 per cent of respondents said they were very or somewhat dissatisfied with the 2009-2010 CashPlus program for barley. The CWB has also not fared well on the customer service front—only one-third of farmers said customer service has improved over the past five years. What business would survive with this kind of customer feedback?

When asked what the main benefits of marketing change would be to their farm business, CFIB farm members indicated they would have access to better marketing signals, greater opportunities to niche market their product, greater control of the profitability of their farm business, and growth in the value-added industry. If governments are serious about driving productivity and innovation at the farm gate, it is time to let farmers make their own marketing decisions on wheat and barley just as they already do with their oilseeds and pulse crops.

Farmers have a lot on the line and control all of the major management decisions on their farm like budgeting, crop rotation, crop inputs, and harvest timing.  Yet, when it comes to marketing their wheat and barley, they have no control of how their crop is sold and are being hobbled by the single desk system.

The federal government has made it clear that changes are coming.  The CWB has responded by conducting a plebiscite which will likely tell us what we already know—some farmers will want to keep the monopoly and some will favor change. Let’s face it; there is nothing about marketing wheat and barley that makes it inherently necessary to restrict marketing choice.  As Henry Vos, CWB Director publicly stated this week, “Some farmers want to market it to the company that will pay the most for it.” It really is that simple.

Marketing change at the CWB is long overdue.  Farmers want the Board to evolve and adapt so that it does play a role in the future of the grain industry, but the CWB will have to show value in the marketing services it provides and deliver the customer service farmers deserve.

Rather than wasting $180,000 of taxpayers’ money on an advertising campaign that appears to focus more on saving jobs in downtown Winnipeg than it does on the rights of farmers, the Manitoba government would be wise to support this change.  If the CWB monopoly continues there is only one inevitable outcome on which one CFIB producer put it best: “It is time to end the debate over the CWB. My CWB crops will drop from 2200 to 225 acres. That will be my silent protest.”

Virginia Labbie is Senior Policy Analyst, Agri-business for the Canadian Federation of Independent Business (CFIB).  She may be reached at msman@cfib.ca

The Canadian Federation of Independent Business (CFIB) is the business voice for agriculture, representing 7,200 independently owned and operated agri-businesses in Canada (2,500 in Western Canada), the majority of which are primary producers. 

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