Ken Larsen
September 13, 2011
At his farewell dinner, departing Alberta Premier Ed Stelmach observed the Chinese market was “a generational opportunity.”
Stelmach’s remarks about this generational opportunity are especially appropriate coming from an Albertan. It was 47 years ago that another Albertan led a western trade delegation to red China. That delegation was actively supported by a Prime Minister from the west, John Diefenbaker, and his Federal Agriculture Minister. The result was a generational opportunity for western Canadian farmers which they have prospered from ever since.
That far seeing Albertan was Paul Babey, the leader of the Farmers’ Union of Alberta, once the province’s largest and most influential farm organization. Babey’s delegation included representatives of the three prairie Wheat Pools which were the largest farmer owned grain handling cooperatives in the world. Sales people from the Canadian Wheat Board were there as well. Much to the consternation of the fanatically anti-red Americans, Babey’s delegation capitalized on Canada’s reputation for fairness and our western farmers’ cooperative enterprises to create a market in a Chinese culture where relationships and trust are the basis for business.
Over the years China has bought billions of bushels of western Canadian wheat and barley directly from western farmers using the Canadian Wheat Board. The CWB still maintains a Beijing office and staff to serve this important market.
Today another western Canadian Agriculture Minister is now in the process of destroying that market with his intention to end the CWB. He wants to replace it with the much less trustworthy private American grain traders who control the rest of the world’s grain.
For the Chinese this will represent a betrayal of trust by their Canadian counterparts that they will not soon forget. They will no longer have the guarantee of quality and integrity established by the CWB.
The big losers in this will be the grain farmers of western Canada. With the CWB gone, roughly 20% of the world’s grain will be dumped on the market each fall. This is a short sellers’ dream for speculators, but as the grain market is pushed to a lower price level, grain farmers in the US and Argentina will suffer as well. Will consumers see lower food prices as a result? Not likely, since processors are more likely to keep the extra profits than to pass on lower prices.
So it is especially ironic that 47 years later we have outgoing Conservative Premier Stelmach talking about opening a generational opportunity with China, while at the same time a Federal Agriculture Minister is planning to take an established market with China away from prairie farmers and give it to American multi-national corporations.
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