Marketing Freedom for Grain Farmers Act – October 24, 2011
Mr. Speaker, Canadian farmers feed the world and they deserve the freedom to ake their own business decisions, whether it is to market individually or through a voluntary pooling entity. We believe that all Canadian farmers should be able to position their businesses to capture the marketing opportunities that are open to them.
This bill aims to give western Canadian farmers the right to choose how to market their wheat, durum and barley independently or through a voluntary pool. The marketing freedom for grain farmers act proposes to end the Canadian Wheat Board’s six-decade-old monopoly over sales of wheat, durum and barley in western Canada. It will give wheat and barley growers across western Canada the same rights that canola and pulse growers enjoy along with farmers in other parts of Canada, namely, the right to do what they want with the crop they paid to plant, grow and harvest. By allowing market freedom, grain growers will be able to market based on what is best for their needs and businesses.
I want to talk a bit about what the opportunity means for Manitobans, where wheat and barley are major drivers of the provincial economy, generating almost $800 million in farm cash receipts and over $900 million in exports just last year. Monopoly is a model no longer appropriate in a modern growth-oriented commodity sector in Canada. Milton Boyd, a professor and economist at the University of Manitoba, agrees. He has stated:
Under marketing freedom, we can look forward to increased innovation and new value-added industries. The removal of the monopoly would allow Manitoba farmers to sell their grains directly to a processor, whether it be a pasta manufacturer, a flour mill or any other of their choosing. Farmer entrepreneurs would have the option of staring up their own small specialty flour mills and pasta plants, without the red tape it currently involves.
There has been tremendous growth in value-added opportunities for oats, pulses and canola across the Prairies over the past 20 years. There is no reason not to expect more opportunities for wheat, durum and barley.
In Manitoba alone the acreage of oats has increased by over 250,000 acres since it was removed from Wheat Board control. This has allowed for the opening and expansion, as an example, of Can-Oat Milling, a processing mill in Portage la Prairie. Just over the border in North Dakota from where I live, many new pasta plants have sprung up and created jobs that very well could have been created in Manitoba.
Recently we heard great news coming out of we Regina that a pasta plant was turning the sod to take Canadian durum next year. That is how quick it can happen. These are the types of value-added industries and jobs that exist when farmers have the option to market their products as they choose. This, along with increased trade, could create many new jobs and opportunities. We know this is a significant change involving a very complex set of issues.
The bill proposes to give farmers and the industry a transition period of up to five years to allow time to adjust to the significant and positive change to their businesses and business models. To avoid market disruption, the goal is for farmers and grain marketers to start forward contracting for the 2012-13 crop year as soon as it is possible. During the transition period, the interim Canadian Wheat Board will continue to offer farmers the option of pooling their crops with initial prices guaranteed by the Government of Canada. During this time, the interim CWB will develop a business plan for full privatization.
Our government is ready to work with the Canadian Wheat Board to chart the way forward because we believe that an open and competitive grain market can and should include a viable voluntary Canadian Wheat Board.
Because innovation is critical to the future of the Canadian grain industry, the proposed bill also provides for a voluntary funding mechanism to support research and market development. We fully recognize that there will be costs associated with this transition and the voluntary Canadian Wheat Board will be a smaller organization than the one existing today. Our government is prepared to assist with the extra ordinary costs associated with winding down this monopoly.
Farmers currently pay the daily costs of operating of the CWB with the overall costs guaranteed by our government. With this change, the government recognizes that farmers should not be left alone to deal with the costs of transition to a voluntary mandate and therefore our government is ready to assist, while making responsible use of taxpayer dollars.
Another important facet of the bill deals with the Port of Churchill, which in the past has relied heavily on Canadian Wheat Board shipments. Our government recognizes, and has demonstrated, our support and commitment to the north. We understand the importance of the Port of Churchill as a valuable asset and we are working with stakeholders across the agricultural industry, as well as other industries, to explore development opportunities for the port and we are looking at a number of initiatives to continue to diversify the economy of Churchill
Jim Carr, the president and CEO of the Business Council of Manitoba said, “We see Churchill as more than a port that takes Wheat Board grain. We see Churchill as the Arctic Gateway”. The managing director of OmniTRAX, Mike Ogborn, said that his organization “sees a strong future for the port and the railway”. Our government agrees with these comments. The Port of Churchill will remain the Prairies’ Arctic gateway to the world.
With regard to the concerns around short lines, which have been raised by many members of the opposition, the Government of Canada, not the CWB, protects the right of producers to use short line railways and inland terminals and we will continue to ensure these producers have that access.
Grain growers in Manitoba are like any other business people. They want to make the right decisions at the right time for their farms and their families. They already decide what to plant and when to harvest. They make marketing decisions on their canola and pulse crops, their peas, lentils, beans, oats and many other crops. They just want the same marketing freedom for their wheat, durum and barley.
Spencer Fernando of The Manitoban said:
My government trusts farmers to make their marketing choices, based on what is best for their businesses, families and communities. We want to put farmers back in the driver’s seat so they can continue to drive this economy. We believe that an open and competitive grain market can include a viable voluntary pooling entity and we are ready to work with the Canadian Wheat Board to chart that future.
We owe it to farmers, customers and shippers to provide market certainty so they can plan their businesses for the following year. With this change, our entrepreneurial farmers can expand markets, increase their incomes and attract greater investment now. So why make them wait? Marketing freedom has been a cornerstone of our platform since day one and it was part of our throne speech last spring. I am proud that we are delivering on our long-standing promise to the western grain farmers. As the Prime Minister has said, what we are seeing here is a new horizon, a new field of opportunity, not just for western grain farmers but for workers and businesses in western Canada generally.
An open grain market will attract new investment, encourage innovation and create new jobs for Canadians. I support that.