When legislation Bill C-18 passes to kill the wheat board s monopoly, Gerry Ritz says he ll celebrate with a glass of barley freedom beer.
It might even be made with malt from Rahr Malting in Alix, Alta., where the minister of agriculture visited Nov. 1 to celebrate the company s announcement to spend $6 million building three, 9,000-tonne storage bins.
Not only will an open market give farmers the marketing freedom they want and deserve but it will attract new investments like this, encourage innovation and create jobs, Ritz said. And as we re seeing here today just the promise of marketing freedom is attracting investment and creating value-added jobs.
It s also providing work for lawyers and advertising companies.
The Western Canadian Wheat Growers Association went to court Nov. 3 alleging the board is spending money illegally to promote its single desk. The association, along with three members Carl Classen of Elm Creek, Graham Sorgard of Loreburn, Sask., and Kevin James of Castor, Alta., is also seeking an injunction to block the board from taking legal action to prevent passing legislation to create an open market for wheat and barley in Western Canada.
The wheat growers contend the CWB and its directors have no right to use farmers money to advance a political agenda, association president Kevin Bender said in a release.
Last week the Canadian Wheat Board launched a $1.4-million print and broadcast stop the steamroller ad campaign aimed at getting urbanites to pressure Ottawa to let farmers decide the board s fate, not the federal government.
Some of the ads have bona fide farmers saying the loss of the board s single desk threatens their livelihood and urges the public to text their MP to complain.
Wheat board chair Allen Oberg says the board s legal fight and advertising campaign are justified because a majority of farmers 62 and 51 per cent for wheat and barley, respectively voted to retain the single desk in the board s plebiscite this summer.
According to former District 1 director Jeff Nielsen, who resigned from the wheat board Oct. 31, the board s internal and external lawyers said a legal challenge would be fruitless.
However, the CWB s lawyers say the board has an arguable case, Oberg said, noting the fact that the Federal Court agreed to hear a similar case launched by the Friends of the Canadian Wheat Board bears that out.
Oberg said the ad campaign will cost farmers a quarter cent a bushel or seven cents a tonne a small amount compared to the $500 million a year farmers earn from the single desk.
If the government doesn t like the message that is out there, there is one quick remedy and that s just put this issue to a vote amongst farmers then this whole issue could be settled, he said.
Ritz and his parliamentary secretary, David Anderson criticized the board s actions, accusing Oberg and the board of wasting farmers money on propaganda.
This is just bizarre, Anderson said in a release. This just demonstrates one more time why farmers need freedom from Mr. Oberg and his cronies.
Farmers should be furious.
Meanwhile, the government has its own ad campaign claiming the open market is best, but it will cost a third as much as the board s, Ritz said.
The government recently mailed coloured postcards to all rural western Canadian residents, not just farmers, extolling the benefits of an open market, criticizing the board s monopoly and directing readers to an Agriculture and Agri-Food marketing freedom.
The postcards make claims the government has not backed up, said Liberal MP Ralph Goodale.
All the empirical evidence that has been done would tend to indicate overall returns for wheat and barley in Western Canada will go down, he said.
That s because instead of one seller there will be thousands and competition drives prices down, he said. The government has economics 101 exactly backwards.
Goodale is also skeptical about government claims that an open market will spark more wheat and barley processing in the West unless processors are able to buy grain at lower prices.
Alliance Grain Traders announced recently it plans to build a $50-million pasta plant in Saskatchewan because of the promised open market Aug. 1, 2012. But the company s corporate filings are revealing, Goodale said.
Margin erosion is combated by negotiating lower prices from growers, negotiating better freight rates, and charging higher end-client prices, it says in its March 30, 2010 submission.
Six million dollars in new grain bins, isn t such a big shot in the arm to adding value to Alberta barley, said Ken Larson, a Benalto, Alta. farmer and member of the Canadian Wheat Board Alliance. Farmers have invested millions of dollars in short line railways and producer car-loading facilities that will have difficulty operating in an open market, he said.
This is not an expansion of their processing capability, it s just an expansion of their storage capacity, he said.
Adding the bins allows Rahr to take delivery of more barley, resulting in less risk to farmers who have their barley selected for malt, only to have it rejected later, said Bob Sutton, Rahr s vice-president of sales and logistics.
Settlements will be done much more quickly (in an open market), he said. Cheques will be written here for the exact amount contracted and the administration costs will be much lower.
Not only will an open market give farmers the marketing freedom they want and deserve but it will attract new investments like this, encourage innovation and create jobs.
Minister of agriculture