Letters, Aug. 29, 2013

Re: ‘CWB fees not cause of producer car drop,’ Aug. 22

Ken Larsen disagrees with Mark Hemmes’ comment that changes in “board fees” have caused the decline in producer cars.

In his argument, Mr. Larsen correctly asserts that under the single desk, producer car loaders “bypassed the inland elevator system and consequently saved paying the private trade elevation fees.” Where he fails is in acknowledging these “elevation fees” are the “board fees” that Mr. Hemmes is talking about.

Mr. Larsen’s “elevation fees” would also be called “board fees” because they were set tariff fees, registered with the Canadian Grain Commission, which applied to CWB grains. These CWB fees, or tariffs, were what farmers saw on their grain payments as deductions or charges for elevation and cleaning. They were by far the greatest contribution to grain company margins on CWB grains. These tariffs were set by each grain company based on, among other things, their experience in handling CWB grains and all that goes with it, such as CWB control over when CWB grain was shipped, which could impede the preferred use and profitability of the elevator. You can’t vilify the grain companies for high “elevation fees” without acknowledging that not only was the CWB complicit, it was the main factor driving these fees, something that Mr. Larsen apparently fails to do.

Now that the single desk is gone, competition between companies — and at times, resistance to sell by farmers — has caused “elevation fees” to shrink. And that makes avoiding them by loading your own cars less attractive.

John De Pape

Farmers Advanced Risk Management Co.

Winnipeg

Correction

The letter to the editor, “I could forgive Pamela Wallin for ‘clerical errors’” in the Aug. 15 issue was incorrectly attributed to Bill Gehl. The author was Matt Gehl. We apologize for the error.

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