In defence of the Canadian Wheat Board
The single desk is a source of justice in a volatile industry
Agriculture Minister Gerry Ritz and Prime Minister Stephen Harper have declared they will end the Canadian Wheat Board single desk in August 2012. Recklessly turning the clock back a hundred years, this move will leave farmers at the hands of the robber barons of the grain trade who are already more powerful than ever before.
The Canadian Wheat Board, at its most basic level, is a wheat and barley marketing agency for western Canadian farmers. Farmers pay for its operations and run it through a majority of farmer-elected directors (ten are elected and five are appointed by the government). There is no cost to the government. All it requires to function is legislation that grants it the authority to market wheat and barley through a single desk. A single desk means that buyers of western Canadian milling wheat and malting barley must go through the Canadian Wheat Board. By being the single source for western wheat and barley, the board is able to capture higher prices for farmers in the global and domestic market place. All returns go directly to farmers with the exception of a small operating fee. Multiple peer-reviewed economic studies have proven that, through the single desk system, Canadian farmers earn more, and by extension the country’s economy as a whole benefits. The Wheat Board gives farmers market power in an international grain trade dominated by a handful of giant multinational grain companies.
The Canadian Wheat Board itself is 76 years old, but it had an even longer genesis. During the First World War, the Canadian government created a wheat board to deal with rising grain prices and the inability of private trade to deal with the situation. The board was very popular among farmers, who began to earn high prices for their grain. In 1920, however, the government disbanded the board, and grain prices collapsed. Farmers agitated for its reinstatement to no avail. These same farmers created the Progressive Party, which advocated the re-establishment of a wheat board as part of its agricultural platform. In 1921, 65 Progressives were elected federally, forming the second largest party in Parliament. The Liberal government of Mackenzie King absorbed many of them by the late ’20s. Others became members of the Ginger Group that led to the formation of the Co-operative Commonwealth Federation, known as the CCF, which later became the NDP. Meanwhile, farmers formed co-operatively owned wheat pools and created a central selling agency to market their grain. This agency collapsed with the onset of the Great Depression in 1929. Conservative Prime Minister Richard Bedford Bennett first created the single-desk Canadian Wheat Board in 1935 as a last-ditch effort to appease the socialists of the country. He lost the 1935 election anyhow, but the Liberals maintained the Canadian Wheat Board, and by 1943 it was marketing wheat, oats and barley through the single desk.
Wheat Board marketing and single-desk selling bring hundreds of millions more dollars to farmers each year than they would receive in an open market. It also brings several times this amount in benefits by acting as an advocate for farmers, giving them the strength to negotiate with railways and making sure all premiums, bonuses and foreign currency trades go directly to farmers. The plan to destroy the single desk, which Harper and Ritz are framing as marketing choice and freedom, will transfer these benefits and funds to some of the richest corporations of the world. Transnational grain companies like Archer Daniels Midland Company, Bunge, Cargill, Louis Dreyfus and Viterra will capture the premiums for themselves and likely dilute the quality of Canadian grain as we have seen in Australia in the years following the disbanding of the Australian Wheat Board in 2006.
The current Canadian Wheat Board Act calls for a farmer vote before any grains are removed or added in whole or in part to the board’s purview. Afraid to allow democracy to function, Ritz and Harper are refusing to allow farmers to decide about the future of the single desk. They know that the vast majority of farmers support the single desk and that farmers have consistently elected pro-single-desk directors since 1998. For years now, the Harper government has also imposed a gag order disallowing the Wheat oard from speaking about the advantages of the single desk.
In an industry fraught with the challenges of unpredictable weather, volatile prices and huge economic powers bent on extracting all they can from farmers, the Canadian Wheat Board allows prairie farmers some form of economic justice for the fruits of their labour. Stephen Harper wants to destroy that. We must not let him get away with this. In the name of democracy, we need to stand up for the wheat board and all that it represents.
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