Western Canada’s farmer-funded wheat checkoff organizations says it’s too soon to have an opinion on whether Cereals Canada and the Canadian International Grains Institute (Cigi) should collaborate more or even merge.
“We’re waiting to see what the process will be and where those discussions will lead,” Manitoba Wheat and Barley Grower Association (MWBGA) general manager Pam de Rocquigny said in an interview May 25. “We will follow it intently for sure.”
“It’s early and our board doesn’t have a position on it right now,” Dallas Carpenter, communications manager for the Saskatchewan Wheat Development Commission (Sask Wheat), said in a separate interview. “There hasn’t been much information so they are just waiting to hear back from Cigi and have more information on the table before they take any position.”
“In principle we support greater collaboration because it has the potential to deliver services to farmers more efficiently, or to the industry more efficiently, and farmers are sharing in a lot of those costs,” Alberta Wheat Commission (AWB) general manager Tom Steve said in another interview.
“We see it as a positive process.”
Cereals Canada and Cigi are already working closely to promote western Canadian wheat sales at home and abroad so it makes sense to explore more collaboration or even merging, Cereals Canada president Cam Dahl and Cigi’s chief executive officer JoAnne Buth, said in separate interviews May 15 and 16.
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The MWBGA and AWC are members of Cereals Canada and Cigi, as are a number of grain companies.
“Given the collaboration and working together and common members… you would expect the boards to essentially say, ‘well, are there further areas for collaboration? Could we get more of a strategic focus…” Buth said.
Sask Wheat belongs to Cigi, but not Cereals Canada. However, a resolution passed at its annual meeting in January urges it to join Cereals Canada.
“No decision has been made yet,” Carpenter said. “The (Sask Wheat) board is still reviewing the (resolution) and it is committed to seeing it through and do its due diligence and make a decision that it feels will best serve Saskatchewan wheat farmers.”
In the past Sask Wheat has said it didn’t want to join Cereals Canada because it was dominated by grain and life science companies that don’t always have the same interests as Saskatchewan farmers.
A Cereals Canada-Cigi merger would raise questions about Sask Wheat’s checkoff funding of Cigi.
“We are confident in the leadership of Cigi and that there will be a plan coming forward and our board will consider it when it does,” Carpenter said.
Cigi was created in 1972 to promote Canadian grain and field crops to domestic and international processors.
Cereals Canada was formed in 2013 to represent Canada’s cereal ‘value chain,’ after the demise of the Canadian Wheat Board Aug. 1, 2012.
Cigi, Cereals Canada and the Canadian Grain Commission visit Canadian wheat customers every fall to promote Canadian wheat sales.
Cigi also offers courses for wheat millers and bakers on how to best use Canadian wheat.
Cereals Canada promotes market access for Canadian wheat and helps inform Canadian farmers about ensuring their wheat is free of chemicals and toxins buyers don’t want.
Cereals Canada and Cigi have some of the same members and directors.
The three wheat groups help fund Cigi through a 15-cent-a-tonne checkoff, matched by seven grain company-members.
The federal government contributes about 35 per cent of Cigi’s annual budget and it also earns revenue from fee-for-service projects.
“The industry as a whole is looking at where it can collaborate,” Steve said. “A perfect example is in this very office where we are combining the management of Alberta Wheat and Alberta Barley.”
MWBGA and four other Manitoba crop commodity funded through farmer checkoffs are exploring increased collaboration and possible amalgamation to serve farmers better.
“We’re still sorting out a lot of industry functions since the end of the Canadian Wheat Board single desk in 2012 and this is one of them,” Steve said. “What is the value chain structure in wheat? Who is responsible for what pieces and who funds those activities? The good news is a year ago we got the grain handlers to equally contribute to the operating of Cigi with the farmers. That relieves some pressure on us for producer checkoffs. It’s still a little unclear what the federal contribution is going to be to Cigi under the new ag policy framework. So we need some answers from that perspective.”
Whether western wheat farmers get to vote on a plan depends on what Cereals Canada and Cigi agree to, de Rocquigny said.
“If they are just looking at further collaboration maybe that’s not required,” she said. “If they are looking at some kind of legal aspect of it… they’ll have their own legal requirements they’ll have to meet if they merge or amalgamate. It’s so early on in the process to try and guess what that process will be. I assume they haven’t even got to that stage yet.”