Prairie farmers vote in favour of wheat board monopoly
Published Monday, September 12, 2011 5:20PM EDT
WINNIPEG - The head of the Canadian Wheat Board says Ottawa must back off plans to strip the marketer of its monopoly over western wheat and barley sales since a majority of farmers who voted in a plebiscite want the board to stay as it is.
Just over 60 per cent of Prairie wheat growers and 51 per cent of barley growers voted in favour of maintaining the monopoly. Fifty-five per cent of eligible wheat producers and 47 per cent of barley growers participated in the board-commissioned vote.
Board chairman Allen Oberg said federal Agriculture Minister Gerry Ritz has no choice but to listen to farmers.
"Their message is loud and clear and cannot be ignored," Oberg said Monday. "This Canadian government is out of touch with farmers. For months now, minister Ritz has been telling us that the federal election gave him all the mandate he needs to dismantle the Canadian Wheat Board. Now, we know otherwise."
Prairies farmers have had to sell their wheat and barley to the board since the 1940s, when producers banded together to get better prices. The board, in turn, exports the grain to foreign markets. Board supporters contend the monopoly gives farmers stability and keeps them from competing against one another at lower prices.
The federal Conservative government, however, has said it will bring in legislation within months to abolish to allow farmers to sell grain to whomever they choose starting next August.
Oberg said the government should back down despite the number of farmers who either didn't vote in the plebiscite or supported marketing choice.
"In a democracy, the majority decision should stand," said Oberg, who added that the board will consider legal action if necessary. "If the government chooses to ignore farmers and moves ahead with legislation, we'll be in a better position to decide what legal opportunities are before us."
The board conducted the plebiscite after Ritz refused to hold one as required under the Canadian Wheat Board Act. He has said he will change the law and eliminate the monopoly, although the board would still exist.
"In an open market, every farmer will have the ability to choose how to market their grain, whether it's individually or through a voluntary pooling entity," he said in emailed comments Friday before he knew the plebiscite's outcome.
"Let me repeat -- regardless of the plebiscite results -- at the end of the day, every farmer will have the right to choose how they market their grain."
A spokeswoman for Ritz said the minister had nothing more to add Monday.
Ritz has the support of provincial governments in British Columbia, Alberta and Saskatchewan. But the Winnipeg-based wheat board has the support of the Manitoba government, which believes farmers have the legal right to decide the marketing agency's future.
"We support the role of farmers in deciding what the future of the organization should be that they pay for," said Premier Greg Selinger at an election debate in Brandon, Man. on Monday. "If they vote 62 per cent to maintain a single desk for wheat, we should respect that. That's a farmer's decision."
Ritz has said the monopoly must go if Canada's wheat growers are going to achieve their full potential.
"The monopoly of the wheat board is standing in the way," he said. "What was once Canada's signature crop has fallen behind."
But one expert said stripping the monopoly may cause serious logistical problems when it comes to exporting Canada's grain. Richard Gray, an agriculture economist at the University of Saskatchewan, said the board is crucial to getting grain moving across the country.
Abolishing the monopoly may not bankrupt producers but it might cause a backup of shipments at Canadian ports and railways, he suggested.
"The politicians could pay a price for this if the transition is not smooth," Gray said. "If a year from now, we have boats waiting in Vancouver and you have rail lines backed up on the Prairies ... someone is going to ask how did we get to this point?"
There is also a legal hurdle -- a group called Friends of the Canadian Wheat Board has taken the minister to the Federal Court of Canada.
The group argues he has to abide by legislation and is legally bound to allow farmers a vote before tampering with the monopoly. On Friday, the head clerk of the court decided the group's request for a judicial review would proceed to a full court hearing.
Spokesman Lyle Simonson had already indicated Friends of the Canadian Wheat Board was prepared to push for the court case to go ahead regardless of the plebiscite's outcome.
"That really is independent of what the wheat board was doing because it pertains to the federal act as it is written," said Simonson, who farms near Swift Current, Sask. "It doesn't really matter what happens with the plebiscite."
Some farm groups, including the Western Canadian Wheat Growers Association and Western Barley Growers Association, want the minister to plow ahead.
"The entire design of this vote was geared toward producing a result in favour of the monopoly," said Kevin Bender, president of the wheat growers. "The government should ignore the results and move full steam ahead with plans to give us our marketing freedom."
The board is definitely big business. It's the largest single marketer of wheat and barley in the world and this year paid farmers about $5.8 billion for the grain it sold on their behalf.
But it has few tangible assets. The board doesn't own grain elevators or port terminals, although it has announced it is buying a couple of ships. It has its own building -- a grey stone edifice in Winnipeg at 423 Main St.
Its main "asset" has been a guaranteed supply of all the wheat and barley grown in Western Canada that is exported or sold for human consumption -- think bread, pasta and beer. Unless farmers want to feed their grain to livestock, it goes through the board.
The monopoly has long been a target of Conservatives and their supporters who, in a minority position prior to the next election, were never able to do anything about it.
They failed in a bid in 2007 to unilaterally remove barley from the board's control when Friends of the Canadian Wheat Board challenged then-agriculture minister Chuck Strahl's plan to do it with a cabinet order. Federal Court ruled the government didn't have the legal right to do that.
Ritz says farmers essentially backed his decision when a majority Conservative government was elected in May.