On Oct. 24, Rolf Penner appeared before the House of Commons Standing Committee on Agriculture and Agri-Food to testify against the Canadian Wheat Board monopoly.
I’d like to start by saying that I’m here not only as the agricultural policy research fellow for the Frontier Centre but, more importantly, as a farmer from southern Manitoba who’s running 1,700 acres of land and whose primary source of income is that farm.
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Right now we are in the middle of a really major rally going on in the wheat markets. We’re at the highest levels today that we’ve seen in 30 years. We can’t take advantage of it and it’s incredibly frustrating. The little bit that we can price out, we can’t deliver, which means we can’t get paid for it.
Instead, if we need cash, and most farmers do in the fall in order to pay their bills, we are forced to sell our other crops at prices that right now are lower than where I expect them to be later this year. In some cases, it’s below the cost of production. If we were free to sell our wheat, we could hold on to these crops until those prices improved and actually make money on everything.
Equally frustrating in all this is that, if this current rally were occurring in any other crop, I could right now start selling next year’s production at a guaranteed profit. But I can’t. The primary reason is not the Wheat Board; it’s the Wheat Board monopoly.
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In its current form, the Canadian Wheat Board sits like a wet blanket over the entire prairie economy—starting at the plant breeders, through the farm gates, on to our rural communities, into our cities, and right on out through our ports. This dampening effect is widespread, pervasive, and very tangible. It’s high time that we give this wet blanket a well-deserved airing out.
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But there is the question of civil liberties. When is it appropriate for the state to allow one group to vote away the civil liberties of another group? There should be no such thing in a free and democratic society as the right to vote away civil liberties. We’re not talking about electing a government here, and we’re not talking about finding out who likes strawberry ice cream better than chocolate. In this case, if strawberry wins, not only are you not allowed to buy chocolate, but if we catch you with chocolate ice cream, you’re going to jail.
What this is all about is finally giving western farmers the freedom to run their businesses in the way they think is best – not how the government thinks is best, and certainly not how their neighbours think it should be run. Western Canadian farmers should be able to enjoy the same rights, freedoms, and civil liberties as the farmers in the rest of Canada do. It is not right, in this day and age, that they are still forced to sit in the back of the bus.
Be sure to read the whole thing – it’s a thoughtful and clearly explained argument.
But wait – there’s more!
Hon. Wayne Easter (MP, Malpeque): Thank you, Mr. Chair. My questions will be to Mr. Penner, who seems to live in quite a dream world, but in any event –
Mr. Rolf Penner: I make my living in that dream world, Mr. Easter.
Hon. Wayne Easter: I do, too.
Set aside the fact that Wayne Easter’s farm is located in PEI – a jurisdiction outside that controlled by the Wheat Board. Consider this: he has served as a Member of Parliament since 1993. During that time, he has also served as a minister and parliamentary secretary. The table below is based on this source – Indemnities, Salaries and Allowances, Members of the House of Commons – 1867 to Date. It is not presented as an accurate accounting of Mr.Easter’s compensation for service in Parliament, but to provide a general idea of his “off farm income” over that period of time. (For simplicity’s sake, I don’t include the $12,000 “additional expense allowance” that was provided from 1993 – 2000, his pension, or the additional salaries he earned as a committee chair.)
I venture there are more than a few western wheat farmers who would trade their “dream world” for that of Wayne Easter’s.
Update – More this mp3 file was forwarded by a reader who advises “Check out the last 9 minutes”.
Farmer Joe – I do not know that the CWB buys grain at Bargain Prices or sells at bargain prices.
Perhaps that is true….perhaps not.
Suppose that the free market buyers end up controlling the whole system.
You could end up screwed.
Going back to that curfuffel that started this most recent round of acrimony. The US Dollar was close to 1.50 CDN and the US producers could not meet demand for domestic use. Canadians tried to capture the opportunity and US producers started complaining immediately even though they had no grain to sell!
Look what happened to Canadian wood producers when the US producers started complaining.
Better think twice about toasting the WB ..better to reform it than kill it I think.
The marketing boards that are mentioned i.e.egg,dairy etc. were all set up to assist the eastern farmer and give them a guaranted price.The CWB is not like that.The CWB does not subsidize the price!The CWB was set up to provide the same price to all farmers. It was argued that the price of wheat in the fall was always lower than the price of wheat in the spring therefor the rich farmers could always get a better price than the poor farmers that had to sell in the fall.The assumption was false.Also,as there was no reason to hold grain till spring everyone wanted to deliver in the fall but there wasnt enough elevator capacity so quotas were introduced to “orderly market” the grain forcing the poor farmers to construct on farm grain storage.Once in a while,mid 50’s for one and late 60’s early 70’s for another,the CWB deemed that the world price of wheat wasnt high enough so they quit selling.In the 69-70 crop year we were able to sell four(4)bushels per acre seeded and had to store the rest.That forced thousands of farmers off the land.Wheat was being sold farmer to farmer for a cent a pound as we couldnt sell it any other way.Then came the Great Grain Robbery where in secret, the USSR bought wheat from the CWB(not Canada as the eastern farmers werent included)at a low price,then went to the open grain markets and forced the price of wheat to record highs for the Americans and others that sold on the open exchanges as they needed thousands of tons of grain.The one thing that every one must keep in mind is that the CWB does not and can not get a higher price than any other grain selling agency for a product of equal value.If this were true then the best way for WAL MART to make more money would be to raise prices and not lower them.
I’m glad someone mentioned selling grain to the US.American millers occasionally have wanted CWB grain but in order to buy it they have to pay the freight to either Vancouver or Thunder Bay then pay the freight to wherever they want it as CWB grain is priced that way.In fact grain was shipped to Thunder Bay,never unloaded,brought back to Winnipeg,then shipped south to Minneapolis.Farmers have been selling cattle to the US for years with no problem until BSE and it was CAnada that wanted the seven year ban before it affected Canada.As far as the soft wood argument goes,you better find out what the basis of the dissagreement is about before you comment on it.
OMMAG making it voluntary is reforming it, and if you don’t know what you’re talking about (as you admit)either inform yourself or find a topic that you do know something about.
I know when I’m getting screwed and whose doing the screwing, its the CWB monopoly that’s screwing us over not the Americans.
Spike .. I think we agree on most of this.
But…I’ll say that if Western Canadian grain farmers want to sell direct to the US market they will be at the mercy of US producers. History proves that trade agreements mean nothing since any producer group in the US can have the border shut for really no reason except to exclude the competition!
Yes / No ??
The Great Grain Robbery. Ah yes. The CWB was taken to the cleaners in the 70s. As was the USDA.
And, yes, the CWB does have a hard time getting a better price on the world market. It is up against all the Other , susidised exporter/importers. USDA, AWB, CAP, Japan Food Agency, China Food Agency, ect. That leaves the stiffest competition of all, Brazil and Agentina, with half our cost of production. Sounds hopeless.
True, Canada’s Supply Managment Marketing Boards have a captive market. That is why it works. Grain and oilseeds Farmers do not have that luxury. Sounds hopless again, without govmit subsidies.
Primary food production in the world will Never be left to the free market. Not even in the US, as in USDA. Argentina/Brazil is as close as we will get. Sad but true.
Farmers are the most esential element in our society. What is more important than food ? Motorboats ? Hockey Sticks ? Doctor can save your life but you will die anyways without food. That is why govmits want complete control of the food supply. Second most important ? you got it, Medical care, hence medicare. Another story.
But really, a few dollars better basis, here or there, can make a difference, but. But the big story on govmits playing screwer is the Crow Rate Subsidy.
The CRS came into being in the 20s. Capped in 86, eliminated in 97. Per thousand acres(MB) during 60s,70s,80s & 90s, it was worth about $1.5 Million. One and a half $Million. It was supposed to be forever, to help settle the west. The west got settled, people are in place. Some farm groups wanted the Crow canned. Chretien complied. Was costing him (taxpayers) $Billion a year. Just like CBC.
Canadian Farmers were told that other countries would also drop their subsidies and the world price of grain would rise. Yep. Didn’t say when.
Ever wonder why the delivery points against futures contracts were changed at the same time ? Van to Saskatoon(canola) ? T-Bay to Virden(flax) ? At the same time as Crow shot ? Me too.
Oy Vie, it’s not all about shipping into the ‘US’ market, it’s about having direct access to the ‘world’ market.
And the board has no market power it never had, if it did this would be the year we would see it, when the world is short of wheat. But we are getting hosed, getting less than what the market says the stuff is worth.
It is opposite of a subsidy it transfers wealth from the prairies to other countries. End the monopoly and farmer incomes will rise accordingly.
You can talk all you want about what other countries are doing and not doing, but this buying monopoly is a self inflicted wound. And this is something that we Canadians can and should fix ourselves.
Yeah – lack of Wheat Board marketing power is why canola never got off the ground in Western Canada.
The solution is always freedom.
Always.
Canola is in an openned and Free Market ?? As in antifreeze or copper ?? Doesn’t seem like it. One would think that grain companies would make all the sales they could, in any given year. Volume is their bread and butter.
But how come Canada’s Canola carry over often seems to majically hover around 1-2 Million Tonnes each year ? Under 0.7MT, strong prices.. 2MT, depressed. Whether you guys grow 3MT or 6MT carry-over usually falls in the same range.
Have we ever had a year with a sell-out ?? Imagine the price !! Supply and demand has an effect on price but the big driver is carry over.
With the govmit controlling the CWB, carry over is VERY easily managed. Ah, don’t seem to be any sales overseas right now. Ya, right.
In tight supply situations, the USDA has also required US grain companies to apply for export permits. Same shit different pile.
Politicians see food supply security as too important to leave to the market place. So other countries may have to periodically do without ?? Ever heard of starvation in other parts of the world ?? Usually Third World ? Meanwhile Canada still has it’s 0.7MT “reserve”.
It might be said, the second thing govmits fear the most is running out of food.
The thing govmits fear the MOST is having control of the food supply fall into other hands. Their goal is to keep the grain carry over tonnes AND Farmers economic well being within certain ranges. Supplies getting critical, squease of exports. Farmers in dire-straights, throw out $Billions in subsidies. Farmers that are trying to keep afloat will produce flat-out. Financially independent Farmers may become indifferent to mediocre grain prices. Would scare the gov to death. Nothing causes a population to rise up more than hunger. Hard to believe, here in Canada. “The Ranges”, small price to pay for food secutity, .. so poloticos think.
It is not the case, Al-Lea, that *Canadians* love their health care monopoly. Some think they do, some think they hate it.
Others realize we don’t actually have any such thing, so they keep their passport up to date and $100,000 in liquid assets on hand. That works, to a point, for health care, though personally I would much rather spend my funds on Canadaian doctors and nurses.
But farmers have no such option. They can’t just get on one of the nine flights a day from Calgary to Houston with 100,000 bushels of wheat in their luggage.
Mr. Hoax, maybe you could show me your math on the crowrate, as to how you arrive at 1.5 million on a thousand acre farm over fourty years? Then i’ll show you mine.
The western cwb reminds me of the gang of thirteen, charging hot dog vendors for protection. Ya, protection from who!
As far as i know, no one is talking about doing away with the cwb, all they are saying is give farmers a choice. What is wrong with that? The eastern boys have a choice or does communisum sit well with you?
As for marketing canola; flax; canary; oats; peas etc. i don’t want any form of wb doing that for me thank you very much. To many burocrats and snivellin servants charging me protection money as it is!
This a fairly cut and dried issue. If the CWB was such a wonderful entity it would actually be a Canadian Wheat Board instead of a Western Canadian Wheat Board.
I don’t understand how it is legally possible to force a group of farmers into slavery based on geography.
The CWB serves the same purpose as the Crow rate subsidy. This was to provide cheap natural resources to the Eastern food processing industry. Does it make any sense to have the majority of food processing so far away from the areas of food production? This would be like having all the oil refineries in the East.
The Crow rate Subsidy and the CWB have helped to bring wealth and prosperity to Eastern Canada and the Western farmers are left with the dregs.
The other argument for ending the CWB monopoly is the fact that the NDP governments of Sask and Manitoba are arguing to keep the monopoly. We all know that these governments are in the pockets of the Labor Unions . The CWB pays these Unions handsomely and this would end. The other thing that Dippers are afraid of is prosperity. The more prosperous people are the less likely they are to vote NDP.
If this monopoly were to end we would see a revitalization of rural Sask and Manitoba. This would dilute the Dipper power base . These socialist government are currently on life support and are terrified that people would move out of the cities and back to rural areas to work and raise their families. The NDP in Sask have been very successful in the rural depopulation process.
There are many leeches out there who have been making a living off the backs of the farmers and they are not going to give up without a fight.
There are many hidden agendas at play here. PMSH has proven to be very adroit at seeing through all the BS and getting to the truth. The truth is that western Canada is being treated unfairly by the CWB and his government wants to put an end to this discrimination.
Please read the posts. Associations, marketing boards, ect can be, but not necessarily so, beneficial to its members. But not, neccessarily, to the customers. The problem is when govt’s are runnung the show. The problem with ag, all ag, is gov’ts are running the show. In virtually every country of the world. Eating is important for the living. Politicians,in their opinion, think it is too important to be left to the markets and the ones growing the food.
While the truth is that it is too important to be left in the hands of politicians.
01:44 PM, …. to be left in the hands of the Politicians. Yes !! After all, they are not the ones producing our food. Hence the name, Producer.
Politicians also, by the way, do not perform surgery.
I’d still be interested in your numbers on the 1.5 mill mr. hoax.
Here we have a PMSH trying to change that sir, and give us choice and all he is getting is flack. Course, when your going to get kicked off easy street your gonna howl aren’t you. Right now the wb doesn’t give a rats ass what they sell the grain for…their still gonna get their cushy cheques. If they don’t like the idea of dual marketing, the same as the eastern boys have then I say givem the boot altogeather! and i can tell you i’m not alone on that stand.
rural roots – you have stated all the facts very clearly in your excellent post.
One day Chuck Stral asked the Easter bunny why he did want a WB in P.E.I. The answer was stupid retoric about ‘better oppertunities for the prarie folk – very insulting to prarie farmers.
Easter bunny is very nervous and it shows – he is worried about something in the WB and I’m thinking it is not concern for the bottom line on any prarie farm. Culvert and the Dippers are exactly the ilk you say they are – they want Sask. and Manitoba to have BIG government farms like Uncle Mo (er Joe!) in the U.S.S.R. had …collectivize all those ‘yappers’ who make trouble among the sheeple.
Crow Rate Benefit for a k acres.
S/C MB, a discussion post, FR subsidy(est)
CRB – Crow Rate Benefit
T/A – Tonnes per acre production
%EX – to Van, TB
I(8%)- multiplier for interest accumulated
$/A/Y – av$ per acre per year benefit for decade
Decade .CRB$ .T/A .%ep .I(8%).$/A/Y
———————————————-
87-97 ….. 18 ….. 1.4 .. 80 … 1.5 … 30.24
77-87 ….. 15 ….. 1.2 .. 80 .. .3.0 … 43.20
67-77 ….. 11 ….. 1.0 .. 80 … 6.0 … 52.80
57-67 …… 6 .. …0.7 .. 70 .. 12.0 … 35.28
$30.24 X 1000ac X 10yrs = $302,400
$43.20 X 1000ac X 10yrs = $432,000
$52.80 X 1000ac X 10yrs = $528,000
$35.28 X 1000ac X 10yrs = $352,800
————————————————
………………………………. $1,615,200
It would seem your assuming a lot there mr. hoax. First off they didn’t pay the crow on a per acre basis, but on bushels shipped.
Secondly you are assuming that every acre was seeded. Continuous cropping only started in this country around 1990, before that most farmers were half and half and some still are. That cuts your numbers in half.
Thirdly, There are a lot of farmers that would die for the yeild’s being used in your demonstraition. My wheat probably made around fourty this year, and there are a lot of boys who took off eight bushels per acre because of drought. Dear old Dad, if he got thirty bushels and acre he thought he was doing good. Your chart assumes the top end every year. You can make figures do anything mr. hoax. especially when you assume.
From Manitoba Dept of Agriculture.
Continuous cropping started in South Central MB in the mid 60’s. Av wht yields(bpa); 1960s-26, 70s-37, 80s-44, 90s-52. T/A is the average tonnes(bushels) per acre produced,shipped. Approximately 80% of production was shipped to export. 20% for seed, local feed grains, ect.
Ya, there was one fella here trying it in the late sixtys to. So i suppose you could say it started if you want, but it didn’t take off till around 1990. I trucked fuel all over manitoba in the seventys, there sure was a lot of black dirt around. Now go check crop insurance and see how many have a 52 bushel average. Because around here there isn’t anybody with that kind of average. to many variables, drought, hail, bugs, you name it.
Thanks for the air time Kate.