REGINA — Historic changes are on the horizon for western Canadian grain farmers and the ripples could be felt from a tiny port town in northern Manitoba to grocery store shelves.
Federal legislation allowing Prairie producers to sell their wheat and barley to whomever they choose means, after almost seven decades, farmers will no longer be forced to market their grain through the Canadian Wheat Board.
The issue has been a divisive one.
“Pretty significant negative changes are coming down the road and we’ve got to do everything we can to stop it,” said Bill Gehl, a third-generation farmer who grows canola, flax, peas, wheat and barley on about 1,600 hectares just north of Regina.
Franck Groeneweg, who farms about 3,600 hectares near Edgeley, northeast of Regina, vehemently disagrees.
“I applaud the changes. … it’s going to give us a lot of flexibility on the farm,” said Groeneweg.
The wheat board was set up following the Great Depression as a way for farmers to band together and seek higher prices. In 1943, what is referred to as the “single-desk” was created, essentially a monopoly that meant all western farmers had to market their wheat through the board.
According to the board’s website, it arranges for transportation from thousands of farms to customers in 70 countries. About 21 million tonnes of wheat and barley are marketed by the board each year.
Supporters say the single-desk prevents producers from competing against each other for sales.
Opponents say they want the freedom to seek better deals on the open market. They point out that producers of other grains and wheat farmers in other parts of Canada already have that freedom.
“My parents farm in France. It’s an open market and prices of grain over there are not any better or worse than they are here,” said Groeneweg, who has been farming in Saskatchewan for 10 years.
“They’re not any better over in the States, any better or worse. There are times when they’re better; there are times maybe they’re worse. On average, really, it comes to being the same except they can market their grain flexibly.”
It’s about more than just price for Groeneweg. It’s also about what he can do with his wheat.
“Under the monopoly, my wheat here, if I want to start to transform it to make pasta or flour and sell it to people in Regina…I have to sell that grain to the Canadian Wheat Board and then buy it back — quite often at a higher price than I sell it for.”
But Gehl pointed to the loss of what was known as the “Crow rate” as a warning to what may come. The Crow was a subsidy on freight transportation for western farmers who faced higher costs getting grain to port because of their landlocked location. The rate was eliminated by the federal Liberal government in 1995.
“More than likely what will happen is, just like what happened with the Crow, we’ll see an exodus of farmers from the farm,” predicted Gehl.
“And, sadly, more than their fair share will be young farmers that will be leaving the farm. Because of the debt load that they carry, they’re not going to be able to withstand this, so we’re going to see some losses very quickly of our young farmers.”
Then, there’s Churchill.
Critics of the federal Conservative government’s plan to end the board’s monopoly warn the move could have devastating consequences for the northern Manitoba town and its economy.
Churchill, on the shore of Hudson Bay about 1,000 kilometres north of Winnipeg, gets 95 per cent of its port business from the wheat board. Some 200 jobs — about one-fifth of the town’s population — are directly connected to grain shipments.
“I guess another thing is the port of Churchill will more than likely be toast,” said Gehl.
“I don’t even think the federal government is arguing against that. They’re trying to buy them off with $5 million a year. It’s really very sad. The people up in that area — and certainly the farmers in that catchment area of Churchill — will see significant increases in their transportation costs.”
Howard Leeson, a political science professor at the University of Regina, said it’s tough to know what impact the changes will have on a farmer’s bottom line.
“Any time that you’re operating in a huge international market, you have to have some leverage out there or you have to sell to a company that has some leverage,” said Leeson.
“If you sell to a company that has some leverage and (is) able to sell its product — that means your product — then what will happen is that you … access their leverage. But they charge you for that because they have shareholders and they want to make a profit.
“The wheat board was, I think, a very valuable tool for us in the international leverage we had without actually having to pay … because we were the shareholders of it.”
Not far from the University of Regina campus, Mark Dyck rises early to start baking bread at Orange Boot Bakery.
He pounds the dough into French loaves and baguettes that turn golden in the oven and create a mouth-watering aroma. Dyck doesn’t know if he’ll see any difference with the wheat board changes, but he hopes he will.
“If this is a catalyst … for farmers in Saskatchewan to do more speciality work, smaller scale specialty stuff, that would help me out a lot,” said Dyck.
“It would help me out a lot if there was more variety of wheat, more variety of other grains, if I could get the lab information about the flour because it has an impact on the bread that I bake.
“All of that is good for the baker and right now, outside of a very few small organic millers, it’s a one-stop shop. You buy from the big factory or you don’t buy flour and that’s too bad.”
No one really knows how the changes will be felt along the food chain. Will people see a difference when they reach for a loaf of bread or a box of pasta at the grocery store? That depends on who you ask.
“I think that the impact is mainly in the export market frankly,” said Leeson. “But there might be a small increase as companies try to maximize their profit position on that, so not a lot of change…for the person going into the store one way or the other. Its major impact is on western Canadian producers.”
Gehl believes the premium price western farmers now get for their wheat will disappear. And, he suggests, if producers aren’t getting the best bang for their buck, quality will lose out over quantity.
“If the quality suffers of the grain that I grow on my farm, it can’t help but have an effect on the quality of the food that you put on your table.
“If I’m growing inferior products because I make more money at it, you’re going to have an inferior product to eat.”
Groeneweg stands in his kitchen holding a box of rotini. He doesn’t think wheat quality will go down or that people will see any difference in the store.
“If we look at the price of bread or pasta in the U.S., it’s not any different than it is over here. I’m talking right now in the past 75 years with the Canadian Wheat Board marketing our grains. So why should it be any different after the changes are happening?”
Original Article
Source: iPolitico
Federal legislation allowing Prairie producers to sell their wheat and barley to whomever they choose means, after almost seven decades, farmers will no longer be forced to market their grain through the Canadian Wheat Board.
The issue has been a divisive one.
“Pretty significant negative changes are coming down the road and we’ve got to do everything we can to stop it,” said Bill Gehl, a third-generation farmer who grows canola, flax, peas, wheat and barley on about 1,600 hectares just north of Regina.
Franck Groeneweg, who farms about 3,600 hectares near Edgeley, northeast of Regina, vehemently disagrees.
“I applaud the changes. … it’s going to give us a lot of flexibility on the farm,” said Groeneweg.
The wheat board was set up following the Great Depression as a way for farmers to band together and seek higher prices. In 1943, what is referred to as the “single-desk” was created, essentially a monopoly that meant all western farmers had to market their wheat through the board.
According to the board’s website, it arranges for transportation from thousands of farms to customers in 70 countries. About 21 million tonnes of wheat and barley are marketed by the board each year.
Supporters say the single-desk prevents producers from competing against each other for sales.
Opponents say they want the freedom to seek better deals on the open market. They point out that producers of other grains and wheat farmers in other parts of Canada already have that freedom.
“My parents farm in France. It’s an open market and prices of grain over there are not any better or worse than they are here,” said Groeneweg, who has been farming in Saskatchewan for 10 years.
“They’re not any better over in the States, any better or worse. There are times when they’re better; there are times maybe they’re worse. On average, really, it comes to being the same except they can market their grain flexibly.”
It’s about more than just price for Groeneweg. It’s also about what he can do with his wheat.
“Under the monopoly, my wheat here, if I want to start to transform it to make pasta or flour and sell it to people in Regina…I have to sell that grain to the Canadian Wheat Board and then buy it back — quite often at a higher price than I sell it for.”
But Gehl pointed to the loss of what was known as the “Crow rate” as a warning to what may come. The Crow was a subsidy on freight transportation for western farmers who faced higher costs getting grain to port because of their landlocked location. The rate was eliminated by the federal Liberal government in 1995.
“More than likely what will happen is, just like what happened with the Crow, we’ll see an exodus of farmers from the farm,” predicted Gehl.
“And, sadly, more than their fair share will be young farmers that will be leaving the farm. Because of the debt load that they carry, they’re not going to be able to withstand this, so we’re going to see some losses very quickly of our young farmers.”
Then, there’s Churchill.
Critics of the federal Conservative government’s plan to end the board’s monopoly warn the move could have devastating consequences for the northern Manitoba town and its economy.
Churchill, on the shore of Hudson Bay about 1,000 kilometres north of Winnipeg, gets 95 per cent of its port business from the wheat board. Some 200 jobs — about one-fifth of the town’s population — are directly connected to grain shipments.
“I guess another thing is the port of Churchill will more than likely be toast,” said Gehl.
“I don’t even think the federal government is arguing against that. They’re trying to buy them off with $5 million a year. It’s really very sad. The people up in that area — and certainly the farmers in that catchment area of Churchill — will see significant increases in their transportation costs.”
Howard Leeson, a political science professor at the University of Regina, said it’s tough to know what impact the changes will have on a farmer’s bottom line.
“Any time that you’re operating in a huge international market, you have to have some leverage out there or you have to sell to a company that has some leverage,” said Leeson.
“If you sell to a company that has some leverage and (is) able to sell its product — that means your product — then what will happen is that you … access their leverage. But they charge you for that because they have shareholders and they want to make a profit.
“The wheat board was, I think, a very valuable tool for us in the international leverage we had without actually having to pay … because we were the shareholders of it.”
Not far from the University of Regina campus, Mark Dyck rises early to start baking bread at Orange Boot Bakery.
He pounds the dough into French loaves and baguettes that turn golden in the oven and create a mouth-watering aroma. Dyck doesn’t know if he’ll see any difference with the wheat board changes, but he hopes he will.
“If this is a catalyst … for farmers in Saskatchewan to do more speciality work, smaller scale specialty stuff, that would help me out a lot,” said Dyck.
“It would help me out a lot if there was more variety of wheat, more variety of other grains, if I could get the lab information about the flour because it has an impact on the bread that I bake.
“All of that is good for the baker and right now, outside of a very few small organic millers, it’s a one-stop shop. You buy from the big factory or you don’t buy flour and that’s too bad.”
No one really knows how the changes will be felt along the food chain. Will people see a difference when they reach for a loaf of bread or a box of pasta at the grocery store? That depends on who you ask.
“I think that the impact is mainly in the export market frankly,” said Leeson. “But there might be a small increase as companies try to maximize their profit position on that, so not a lot of change…for the person going into the store one way or the other. Its major impact is on western Canadian producers.”
Gehl believes the premium price western farmers now get for their wheat will disappear. And, he suggests, if producers aren’t getting the best bang for their buck, quality will lose out over quantity.
“If the quality suffers of the grain that I grow on my farm, it can’t help but have an effect on the quality of the food that you put on your table.
“If I’m growing inferior products because I make more money at it, you’re going to have an inferior product to eat.”
Groeneweg stands in his kitchen holding a box of rotini. He doesn’t think wheat quality will go down or that people will see any difference in the store.
“If we look at the price of bread or pasta in the U.S., it’s not any different than it is over here. I’m talking right now in the past 75 years with the Canadian Wheat Board marketing our grains. So why should it be any different after the changes are happening?”
Original Article
Source: iPolitico
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