Forty years ago, Gordon Miles had no idea he would one day find himself looking back on a career in agriculture.
The soon-to-be-retiring Canadian Grain Commission (CGC) chief operating officer was a hockey-playing city kid, with a bachelor of arts degree who had majored in French and minored in religious studies and was one year into a master of divinity on the way to becoming a church minister like his father when serendipity struck.
“A summer job became a full-time job, became a career,” he said recently during an interview in his sixth-floor corner office just steps away from historic Portage and Main, the centre of Canada’s grain industry.
After completing his first year of his master’s degree at the University of Toronto, Miles decided he wanted some business experience.
A family friend got him a summer job at Cargill’s Elm Creek elevator “slinging pails of chemical and bags of seed.”
A few weeks later Cargill had one position left in its university recruitment program for a research assistant. Miles, who had a liberal arts degree from Ivy League Dartmoth College, but no agriculture or business experience, got the position. He suspects his college made a favourable impression on the American Cargill vice-presidents considering him.
Miles, who had good marks in high school, was pursued to play hockey for several American universities, including Princeton. He picked Dartmouth because its schedule accommodated hockey and studying overseas.
“I ended up having a degree in French because I had an opportunity to study in Strasbourg, France,” Miles says. “By the time I came back I was more than halfway to a French major.”
Just as Miles had no inkling he’d be working in agriculture, neither did he foresee how having studied French would help him 25 years later at the CGC.
As COO, which is equivalent to an assistant deputy minister in the federal government, Miles was required to have a certain level of fluency in French.
There were a lot of stops for Miles before the CGC.
“I traded foreign exchange (at Cargill). I worked as a grain merchandiser for the Manitoba region and then I was the product manager for special crops contracting and selling special crops. I had moved into my fifth job in my fifth year with them and that was in human resources — an adviser to the vice-president of western Canadian operations,” Miles said.
In 1984 Miles joined the Grain Transportation Agency (GTA), created that same year under the Western Grain Transportation Act. It morphed from the Grain Transportation Authority, established in 1979.
The GTA was an impartial co-ordinator for the entire western grain-handling and transportation system, setting monthly grain shipping targets. By the end of his time at the GTA, Miles was its deputy administrator.
In 1993 Miles joined Manitoba Pool Elevators (MPE) as general manager of services and development.
Big changes were coming to the grain business, and especially the farmer-owned grain companies, including amalgamating many elevators into a smaller network of larger facilities.
“People were like, ‘oh my god, we have 100 facilities, you were talking about 10 or even 30,’” Miles said. “Every community thought they should have their own elevator.”
But fewer, bigger elevators were needed to take advantage of lower freight rates for unit trains of 50 and 100 cars.
Later the three Prairie Pools discussed merging, but failed to do so.
“Once SaskPool decided to expand outside of its borders we needed to do something to stay competitive,” says Miles.
In 1997 MPE and Alberta Wheat Pool tried unsuccessfully to buy United Grain Growers, which then was publicly traded, but had started as a farmer-owned co-operative. In 1998 Manitoba and Alberta Wheat Pools merged to form Agricore.
April 1, 1999 Miles joined the Canadian Wheat Board as executive director of corporate affairs. Less than two years later he had moved on to become the CGC’s COO.
In the meantime, he watched grain companies continue to consolidate. In 2007 Saskatchewan Wheat Pool, which had become a publicly traded company that had flirted with bankruptcy, swallowed Agricore United to become Viterra.
“How ironic is it that the Pools had two or three goes at amalgamating and didn’t?” says Miles.
“It didn’t work when we were co-ops, but it did after everybody became publicly traded.”
In 2012 Glencore, one of the world’s largest commodity trading companies, purchased Viterra. Like most in the grain industry, Miles says he didn’t expect the once-dominant Pools to disappear.
“I always figured there would be some type of co-operative structure,” he says. “But we could see the pressures coming.”
As the grain-handling industry consolidated, things weren’t standing still at the CGC either.
The organization has also seen a lot of changes, including a legislated requirement for financial self-sufficiency that began in 2013. It prompted a large jump in the organization’s fees, paid for by the grain companies but believed to be largely passed back to farmers.
Mandatory CGC inward grain inspection at export terminals was also dropped. Fees would have been even higher had it not been. One of the biggest effects was on the CGC’s workforce.
“We ended up downsizing the organization by about 45 per cent,” says Miles. “We went from about 703 positions to just over 400. That was obviously a huge, huge impact on the organization.”
The transition, which began in 2007, was hard on management and staff. Miles credits both for staying productive despite the uncertainty.
The CGC has also found itself working to resolve customer complaints about lower gluten strength in Canadian milling wheat, demonstrating the value of testing new varieties to ensure they meet end-use quality standards.
Several years ago a couple of quality tests were dropped to save money. At the same time several varieties that had special agronomic attributes, but were on the edge for gluten strength, were registered. Those varieties soon made up most of the wheat in the premier Canada Western Red Spring class. That, along with a couple of poor growing seasons, is believed to have resulted in the issue arising.
The CGC, after consulting the industry, has tightened the quality standards for CWRS. It also created a new class — Canada Northern Hard Red (CNHR) — for wheats with lower gluten strength and protein. Starting Aug. 1 of this year, several CWRS wheats that no longer fit the CWRS class standard will move to CNHR.
“Making sure you have the right tests in place to approve varieties in the first place is where it starts,” says Miles. “That is the difference between our system and the U.S. In our system we do the testing up front.”
Miles is steadfast in his support of Canada’s grain-grading and wheat class system, even as some farmers push for a more American system based on end-use specifications.
Although the CGC’s grading system is visual, it’s based on science and strives for consistency among the grain company and CGC grain inspectors. Every year grain-grading samples are compiled to assist inspectors. And when farmers disagree with a buyer on grade the farmer can ask the CGC to grade it. The CGC grade establishes a base for both buyer and seller.
“I think for producers it helps ensure fair transactions when they deliver to a primary elevator or a processor,” says Miles, adding buyers and sellers are free to use specs in their transactions.
“I’ve heard people say all you need is protein and falling number. It ain’t that simple.”
He noted the current Canadian system is better suited to accommodate season-to-season variability in grading factors.
A visual grading system is also efficient and inexpensive, Miles says. Various grades of CWRS wheat come with known end-use quality. But there are crop years when the visual proxies used in grading don’t accurately reflect end-use quality.
For example, this year the link between fusarium-damaged kernels (FDK) and levels of deoxynivalenol (DON), the toxin caused by fusarium head blight, is inconsistent. As a result, some farmers want DON measured instead of FDK. But different buyers have different DON standards.
“You have to be really careful,” warns Miles. “If we are going to go that direction… the industry needs to be very aware of what it is doing and decide whether the benefits outweigh the risks.”
For years researchers have been trying to build the so-called ‘black box’ — a machine that will sample wheat on the elevator driveway and spit out an objective measure of its quality.
“It has been five years away for 35 years,” says Miles. “Will we get there someday? Maybe. Is it there today? No.”
Technology can be helpful in grading grain, but it must be balanced against the efficiency and cost effectiveness of a visual system that is, for the most part, working well for Canada’s bulk handling system.
Classes are an efficient and less expensive way to move wheat in a bulk handling system, says Miles. Elevators can commingle different wheat varieties within the same class. Blending also contributes to the consistency of Canadian milling wheat.
Meanwhile, grain buyers can and do segregate varieties if customers want that and are willing to pay for the extra costs.
Friends and colleagues will be celebrating Mile’s retirement later this month at Bregmann’s on Lombard, on the sixth floor of the Grain Exchange Building.
“It’s kind of neat that it’s coming full circle,” Miles said. “That is where I spent the first four years of my career. I’ve spent almost 40 years pretty much working within a block of Portage and Main.”