Winds of Change in the Prairies

Its monopoly may be ending, but the Canadian Wheat Board is still crucial to farmers.

If Prime Minister Stephen Harper really cares about free choice for farmers, he should first try to save the Canadian Wheat Board (CWB).

or many Prairie farmers, this may very well be the last harvest season in which they are required, by law, to transact with the CWB. Come fall, they may be able to sell their barley and wheat to whomever they want without risking jail time. Historically, market volatility in the Prairies has been managed through wheat pooling and the international sale of wheat solely through this overriding legislative board. The Conservatives have made it clear that they intend to reform, as soon as possible, how we sell wheat and barley for human consumption to the world.

The single-desk control in the barley market was to cease in August 2007, but courts overturned the government’s decision weeks before, recognizing that a legislative change would be required for this to take place. With a majority government in Ottawa, an amendment to the Canadian Wheat Board Act is now very much possible. Nevertheless, Ottawa has provided little or no indication of how it intends to manage the agricultural landscape once the monopoly has ended.

Regardless of what happens, many farmers will continue to be reliant on the CWB, and for valid reasons. For one, Canada has many small farms whose owners don’t have the knowledge or capacity to trade independently. Also, farms situated closer to the American border have an unfair advantage over farms located further from it. Remotely located farms would be challenged by logistical costs compared to some larger, more competitive farms, which can capitalize on economies of scale. The ideologically driven debate around the CWB has polarized the issue for decades, and has disallowed any fruitful nationwide debates on the single-desk model to occur.

Case in point: The Harper government intends to move ahead and change the Canadian Wheat Board Act through Parliament without consulting farmers first. Although the 2007 plebiscite’s methodology and the interpretation of the results were inherently flawed, they did indeed represent an attempt to provide farmers with a voice. Denying farmers the right to participate in this discussion may be legally permitted, but such an approach would be democratically reprehensible. Farmers need to be heard, or legal actions are likely imminent.

At the end of the day, the single-desk model should cease. Such a reform will make Canada more competitive, as the monopoly is a hindrance to our ability to compete globally. In Ontario, where wheat farmers are allowed to sell directly to millers, wheat acreage has increased at the expense of western farmers. Overall wheat production and exports have stagnated for years as non-board grains have provided better returns for western farmers. There has been a significant shift away from wheat, and toward the production of corn and soybeans, resulting in a notable long-term decline in Canadian shares of world wheat production and international trade.

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Source: The Mark