Churchill layoffs a preventable tragedy
(Pelly, Sask., July 26, 2016) “The layoff notices to grain workers and others at the port of Churchill, Manitoba are a tragedy for both the workers and farmers in western Canada,” said Kyle Korneychuk spokesperson for the Canadian Wheat Board Alliance (CWBA), an independent prairie-wide farm group. “What is worse is they were entirely preventable.”
Korneychuk went on to say: “Harper Agriculture Minister Gerry Ritz understood this very well and provided a subsidy to create the illusion Churchill would remain a viable port after he killed the farmer-controlled Wheat Board. Now that the subsidy is at an end, it is no surprise the layoff notices are coming.”
“The port of Churchill provided a significant freight advantage to eastern Saskatchewan and western Manitoba farmers. Because the single-desk Canadian Wheat Board could service premium customers they fully utilized the port’s facilities and preserved its rail link using a winter rail program to fill the terminal over winter. By coupling this program with on-farm storage premiums, the single desk brought more money to the farm community and kept this strategically vital asset economically viable” observed Korneychuk who served on the CWB’s elected Board of Directors and earlier on the Board of the Saskatchewan Wheat Pool.
“Our organization frequently warned in submissions to the Harper Government and in advertising during Federal elections that the giant private grain handling companies who control the majority of the world’s grain trade have no interest in using Churchill. For them it is a smaller volume facility which they do not own.” Korneychuk observed.
“On the other hand, farmers represented by the single-desk CWB, which owned no port facilities, had no conflict of interest in using whatever port would return the greatest value to producers and Churchill was one of those ports” he said.
“We recognized that shareholders and owners of the multinational grain companies and the two foreign owned railways have different priorities, and these do not include returning the maximum value of prairie grain to producers or maintaining shipments through facilities they do not own.”
Korneychuk concluded by offering his sympathy to the many workers and their families who loaded prairie grain into ships to help prairie farmers feed the world.
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CWBA releases new research paper
On April 13, 2016 at 10 AM Alberta/Sask. 11 AM Manitoba, the Canadian Wheat Board Alliance released a research paper written by a PhD candidate from the University of Saskatchewan.
The paper is titled: “An evaluation of the present situation for Western Canadian grain farmers within a historical context”
The paper provides a convenient outline of times a single-desk wheat marketing agency has been created in Canada to mitigate the effects of a non-competitive global grain oligarchy and the results when those marketing agencies have been discontinued.
Copies of the paper are available: http://www.cwbafacts.ca/cwba-research-paper-april-2016/
Farm meeting calls for orderly marketing
(Raymore, Sask., March 13, 2016) Over 40 farmers from the Raymore, Saskatchewan area met March 13th and passed a resolution calling for “the establishment of orderly marketing of grain in western Canada.”
Kyle Korneychuk, spokesperson for the Canadian Wheat Board Alliance, an independent and non-partisan prairie-wide farm group noted: “This is the second farm meeting in as many months that has called for the orderly marketing of prairie wheat and barley.”
Korneychuk went on to note that “this level of concern is another strong indication to Ottawa that farmers are now feeling the loss of orderly marketing in their pocketbooks and it shows that the study by Dr. Richard Gray of the University of Saskatchewan demonstrating farmers lost about 6.5 billion dollars in the past two years is accurate.”
The meeting heard from economist Erin Weir who now sits as the MP for Regina-Lewvan. He reminded the audience that orderly marketing was an essential market tool for farmers. Ruth Ellen Brosseau, the NDP agriculture critic, identified a number of key issues for agriculture heading for Parliament this session and pledged her party would support orderly marketing.
Bill Gehl, the farmer-elected chair of the Saskatchewan Wheat Development Commission pointed out that no matter how well the Commission did at supporting the creation of valuable wheat varieties, without orderly marketing the traditional values of those varieties are not coming back to farmers.
Wheat Board Alliance organizer and Brookdale, Manitoba grain farmer Andrew Dennis gave a report on the very successful recent visit to Ottawa he, Ken Larsen, Brendan Sigurdson, and Ken Sigurdson completed.
“We met with 14 MPs and two Cabinet Ministers and received a warm welcome and a respectful hearing. Most important, nobody told us they thought our orderly marketing goal was impossible.”
Dennis reminded the meeting that the annual audited statements of the single-desk CWB showed that with the orderly marketing system prairie farmers received over 90% of the port price and now without the single-desk prairie farmers are only receiving between 40-60% of the port price for their wheat. He warned that “if this is going to be the new normal, grain farming in western Canada is going to hit a debt wall sooner rather than later and that will kill off our younger leveraged farmers.”
Stewart Wells, chairperson of the Friends of the Canadian Wheat Board, gave an update on the current status of the class action regarding the disposition of some of the assets of the dissolved farmer-owned and directed Board. Stewart reported the next court date was set for October 24 of this year.
Kyle Korneychuk observed the single-desk CWB was the economic lynch pin which made prairie grain production viable by ensuring the efficient movement and reliable delivery of high quality-assured grain to customers and guaranteeing that farmers received the premiums customers paid. “To keep those advantages we need to market western grain in an orderly and efficient way through a single-desk selling system” he concluded.
The meeting concluded by unanimously passing the following resolution:
WHEREAS, The loss of the farmer elected, single-desk Canadian Wheat Board has resulted in an increasingly dysfunctional rail system, no grain logistics oversight, a loss of transport efficiency on rail and at sea, reduced grain quality guarantees to other nations, and an overall loss of 6.5 billion dollars in income to farmers over the last two years, which has been devastating to the economy of Western Canada; and
WHEREAS, The ending of the CWB marketing system has resulted in the loss of thousands of jobs across Canada including 460 direct good quality jobs in the heart of Winnipeg and a further 1,834 full-time equivalent jobs that were sustained by the CWB’s administrative expenditures;
THEREFORE BE IT RESOLVED, That this meeting supports the farmers of Western Canada by calling for the establishment of orderly marketing for the selling of grain in western Canada.
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Prairie farmers warn Ottawa to expect continuing biannual $6.5 billion dollar farm losses
(Ottawa, Ontario, March 8, 2016) A delegation of prairie grain farmers travelled to Ottawa this week to warn MPs and Cabinet Ministers about the negative impacts western farmers are facing because of structural changes created in western Canada by the Harper government. Ken Sigurdson, a Swan River, Mb. grain farmer and spokesperson for the non-partisan Canadian Wheat Board Alliance explained “a recent analysis by agricultural economist Dr. Richard Gray of the University of Saskatchewan found that in the last two years the private elevator companies have taken $6.5 billion in excess profits from prairie farmers. This represents fully half the annual value of the wheat and barley crop in Western Canada. These losses will continue compounding the negative effects, including the loss of quality control and grain handling logistics, already felt in the grain industry as a result of changes made by the Harper government.”
Andrew Dennis, a Brookdale, Mb grain producer, added that this hemorrhage of cash from the west is unsustainable and the rise in farm debt to 90 billion dollars is just one of many indicators of trouble on the horizon. “Former customers of the Wheat Board are now complaining about unreliable supply and lack of quality assurance. Ending the single-desk has put Canada’s reputation for high quality grain in jeopardy.”
“There really are no mitigative measures possible to fix this problem of lost farm income,” observed Sigurdson. “A single-desk marketing agency is the only cost-efficient way to address all of these problems with no long-term costs to Ottawa. Our right to single-desk marketing did not die with the destruction of the Canadian Wheat Board. Putting in place a process for farmers to establish a single-desk marketing organization for western wheat and barley would simply be the same regulation of trade that all other countries, even signatories to trade agreements like NAFTA, regularly create and renew for their producers.”
Single-desk marketing agencies give farmers the commercial muscle to provide quality assurances to customers and for farmers to receive the full value of their product.
Sigurdson concluded “the single-desk was an important component of my farm which brought it stability and profitability. I want my son have the same benefits of single-desk marketing that are used by US farmers to market almonds and other crops, just like our own Federation of Quebec Maple Syrup Producers and other organizations around the world make use of.”
Swan River meeting unanimously supports reinstating the CWB
Manitoba Minister of Agriculture Ron Kostyshyn speaks at Swan River meeting
(Swan River, Manitoba, February 12, 2016) More than 50 farmers from the Swan River and Pelly areas of Manitoba and Saskatchewan met February 10th and unanimously passed a resolution calling for “the re-establishment of the Canadian Wheat Board (CWB), and single-desk selling of grain in western Canada.”
Kyle Korneychuk, spokesperson for the Canadian Wheat Board Alliance, an independent and non-partisan prairie-wide farm group noted: “The fact a farm meeting of this size could unanimously pass this resolution is a strong indication to Ottawa that farmers are now feeling the loss of the CWB in their pocketbooks.”
Korneychuk thanked the Manitoba Minister of Agriculture Ron Kostyshyn and elected Rural Municipal (RM) Councillors from both provinces for their support at the meeting. “Farmers respect those who consistently support them as this Minister has demonstrated.”
Responding to a study by Dr. Richard Gray of the University of Saskatchewan showing farmers lost about 6.5 billion dollars in the past two years; Agriculture Minister Kostyshyn said he is “very concerned about the financial situation of farmers since the loss of the CWB.” The Minister also expressed concern about the future of the rail line to the Swan River valley as well as the rail line to Churchill. RM councillors expressed concerns about the recent closures of elevators and the long-term implications for the rail line.
The meeting, chaired by Minitonas, Mb. farmer Walter Kolisnyk, heard presentations from the Hon. Ron Kostyshyn, Wheat Board Alliance organizer and Swan River grain farmer Ken Sigurdson , and Kyle Korneychuk a farmer-elected Director of the Canadian Wheat Board who was dismissed, along with his colleagues, when former Agriculture Minister Ritz passed legislation ending the Canadian Wheat Board. Last year the Harper government transferred the remaining assets of the Wheat Board to a company jointly owned by the Government of Saudi Arabia and Bunge, one of the world’s largest private grain traders.
Sigurdson pointed out Professor Gray’s study when compared with the single-desk CWB’s annual audited statements shows that with the single-desk system prairie farmers received over 90% of the port price and now without the single-desk farmers are only receiving between 40-60% of the port price for their wheat.
Using Manitoba Crop Insurance data, Sigurdson calculated the loss to the Swan River Valley to be more than 70 million dollars over the last 2 years. “This money is lost to farmers and the community and transferred directly to grain handling companies and railways,” he said.
Kyle Korneychuk explained the CWB coordinated logistics to move grain from the farm gate via rail to port then usually arranged ocean freight direct to end-use customers. He noted “this integrated single-desk system allowed us to provide a high quality branded product into the world market. It allowed us to return almost the full value of the world price to farmers. Farmers only paid for the CWB’s operating expenses but now they pay for the private trade’s operating expenses and the profits to foreign shareholders and grain company owners.”
Korneychuk went on to observe that under the system controlled by grain companies fusarium and other blending programs are no longer being provided and protein premiums are now small and infrequent.
Ken Sigurdson predicted that when short term Federal subsidies to the port of Churchill end next year, it will be the next casualty caused by the end of the single-desk CWB. He noted that although the port remains a strategically valuable national resource, it is at risk of losing its economic reason for existence: grain movement.
Sigurdson observed the single-desk CWB was the economic lynch pin which made prairie grain production viable by ensuring the efficient movement and reliable delivery of high quality-assured grain to customers and guaranteeing that farmers received the premiums customers paid. “To get the advantages of the CWB there is no other solution than to reinstate the CWB single-desk selling system” he concluded.
The meeting concluded by unanimously passing the following resolution:
WHEREAS, The loss of the farmer elected, single-desk Canadian Wheat Board has resulted in an increasingly dysfunctional rail system, no grain logistics oversight, a loss of transport efficiency on rail and at sea, reduced grain quality guarantees to other nations, and an overall loss of 6.5 billion dollars in income to farmers over the last two years, which has been devastating to the economy of Western Canada; and
WHEREAS, The ending of the CWB marketing system has resulted in the loss of thousands of jobs across Canada including 460 direct good quality jobs in the heart of Winnipeg and a further 1,834 full-time equivalent jobs that were sustained by the CWB’s administrative expenditures;
THEREFORE BE IT RESOLVED, That this meeting supports the farmers of Western Canada by calling for the re-establishment of the Canadian Wheat Board (CWB), and single-desk selling of grain in western Canada.
Chairperson Walter Kolisnyk conducts the vote
Grain Companies take $13 million from farmers
Grain Companies take $13 million Valentine’s gift from farmers
(Pelly, Sk., February 18, 2015) “Farmers are justifiably angry over the on-going grain robbery by the private grain trade” said Kyle Korneychuk, spokesperson for the Canadian Wheat Board Alliance (CWBA), an independent prairie-wide farm group.
“Using newly revealed figures we know that farmers had $13.7 million dollars taken from them by the grain handling companies in excess profits in one week alone. This is a continuation of the multi-billion dollar rip-off of farmers by the private trade since the killing of the farmer-controlled single-desk Canadian Wheat Board.”
“The grain companies can call it basis, the economists can call it excess profits or excess basis, but it is real money that the grain companies have which should have gone to farmers” Korneychuk added.
Korneychuk went on to explain the low prices offered by grain companies to farmers were compared to recent west coast port wheat prices reported by Agriculture Canada to Feb. 6/15 and then combined with Canadian Grain Commission shipping data from week 27 of the crop year (Feb. 2 to 8/15) to show the size of the rip-off. Korneychuk said that week’s west coast port price for #1 HRSW (Hard Red Spring Wheat) was reported as being in the range of $337.96/mt ($9.21/bu) while the local price available from one of the giant grain handling companies in eastern Saskatchewan was in the $205.52/mt ($5.60 /bu) range. This is a $133/mt ($3.64/bu) difference.
The Canadian Grain Commission reports that for the week ending February 8, 2015, 227,000 mt of wheat was exported from Vancouver and the St. Lawrence. “Simple arithmetic shows us that for that week alone the grain companies have taken $13,781,170.00 in excess profits away from farmers. It is a wonderful Valentine’s gift to the private trade from Ottawa which farmers pay for” said Korneychuk.
Korneychuk then went on to explain the math which shows how much the grain handling companies are taking now that Ottawa has allowed them to own the grain from the elevator pit and insert themselves between farmers and their former end-use customers:
Wheat Per metric tonne Per bushel
Port Price (FOB Vancouver) $337.96 $ 9.21
Average Rail cost $40.00 $ 1.09
Maximum Regulated Tariffs: (Cdn Grain Commission)
Primary elevation $15.50 $ .42
Terminal elevation $ 10.40 $ .28
Terminal cleaning $ 5.83 $ .16
Sub total: $71.73 $ 1.95
Net to grain companies: $266.23 $7.25
To farmers: $205.52 $5.60
Excess profits to grain companies: $60.71 $1.65
Korneychuk noted that this extra $60/mt ($1.65/bu) is over and above the regulated profits and return on investment allowed grain handlers under Canadian Grain Commission rules – rules which allowed those companies to expand and prosper during the 77 years of the existence of the single-desk Wheat Board.
“We know that last year at this time the grain companies were enjoying record world prices for Canadian wheat which have held more or less steady” said Korneychuk. “We also know The Canadian Transportation Agency rate cap audit showed that the railways moved about 20% more grain than the previous year. So unless the grain is being dumped into the harbour, the grain companies are selling an unprecedented volume of grain and taking record profits from grain producers.”
“A year later, in the face of farmer outrage and the unsuccessful efforts of the Agriculture Minister and others to divert blame to the railways, the grain companies are still taking excess profits and farmers are still getting nowhere near the 90% or more of the world price we once received with the single-desk Canadian Wheat Board” concluded Korneychuk.
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For further information: contact@cwbafacts.ca
Cereals Canada resorts to personal attacks
(Pelly, Sk., February 10, 2015) Kyle Korneychuk, spokesperson for the Canadian Wheat Board Alliance (CWBA), an independent prairie-wide farm group released the following commentary on the personal attack generated by a January CWBA news release titled “Saskatchewan Agriculture Minister Raises Concerns:”
Last month the CWBA issued a news release pointing out that Cereals Canada was made up primarily of big grain and agro-chemical companies whose interests were not the same as farmers and this raised concerns about conflicts of interest between farmers’ profits and those of private grain and agro-chemical companies. We expected some counter argument but did not expect Cereals Canada’s appointed President to respond with an intemperate and personal attack.
The point the CWBA made is that big grain and agro-chemical companies have their own agendas. Those companies do not make billions of dollars of annual profits by leaving money on the table for western farmers, no matter how often farmers are patted on the back and told we are all part of a value chain. As the Manitoba Cooperator’s February 9th Editorial pointed out, these different priorities between farmers and agri-business are not affected by whether there are three farmers from western Canada sitting on the Cereals Canada board, or five as there were a couple of weeks later.
In fact Cereals Canada is a very expensive talking shop to join. We have heard reports that a seat can cost upwards of one-hundred thousand dollars a year. That is a lot of farmers’ money to join an organization that has zero power to enforce farmers’ interests. Cereals Canada has mostly called for farmers to give up more money to supply the agro-chemical companies with research funds or for farmers to give up the genetics we have already paid to develop. There is little value in any of this for farmers. We can do better by using the farmers’ money needed to join Cereals Canada to work on our own research and development that will directly benefit farmers.
In spite of the clichés by Cereals Canada’s Chairperson about every group at that table being “partners” there is no equality among those so-called partners. Most farmers, having seen their grain cheques cut in half this year and who must pay for expensive privately developed seed understand that we have no common interests with these private companies who exist to make as much money as they can from farmers. If Cereals Canada can convince a few farmers that this is also in their interests, so be it. But let’s not pretend things like Cereals Canada will put a single extra penny into western grain farmers’ pockets. The shareholders of private companies have no interest in that, and why should they, now that Ottawa has allowed them to insert themselves between farmers and our former customers?
The colourful insults from Cereals Canada’s appointed President should not divert farmers or the media from these facts.
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Saskatchewan Agriculture Minister Raises Concerns
(January 27, 2015) Remarks by The Hon. Lyle Stewart, Saskatchewan Minister of Agriculture to the January 12th Annual General Meeting of the Saskatchewan Wheat Commission raise concerns about conflicts of interest in the agricultural research sector said Kyle Korneychuk, spokesperson for the Canadian Wheat Board Alliance, an independent prairie-wide farm group.
“By strongly suggesting the farmer-elected Saskatchewan Wheat commission join Cereals Canada, the Minister has shown that he does not understand Cereals Canada is an industry captured group and cannot reflect the interests of farmers. It has only three western farmers on a Board largely composed of representatives of multinational grain and agro-chemical companies. Why would the Minister want to dilute farmers’ voices on such an important responsibility as the research and development of new varieties of wheat and barley?” asked Korneychuk. “The public and our customers have already spoken very loudly that they do not want our essential food crops controlled by multi-national agro-chemical companies whose only mandate is to provide profits to their shareholders.”
Korneychuk went on to observe that during the elections to the Wheat Commission this debate also took place with farmers voting for the continuation of public interest plant breeding and research. “Wheat farmers know that midge resistant wheat would never have been developed by an agro-chemical company with insecticides to sell and all farmers are very aware of the fact that canola research has resulted in very high cost seed compared to the pedigreed wheat and barley varieties developed by farmer-funded research. Minister Stewart apparently has not learned the lesson taught by canola that allowing an agro-chemical company to control research just results in the seed being tailored to enhance the profits of the company, not farmers. The lesson farmers have learned is that conflicts of interest like we’ve seen with canola matter to our profitability and competitiveness and they matter to our customers.”
“We hope the farmer-elected Directors of the Saskatchewan Wheat commission will continue to chart an independent course for wheat research which focuses on profitability for the farmer members who pay for that research. Diluting that interest by joining industry-captured groups and giving research money to the private trade does nothing for either the competitiveness of farmers or the development of the most agronomically useful wheat and barley varieties” observed Korneychuk.
Korneychuk closed by observing that Minister Stewart had set a high standard of democratic accountability when he respected the right of all Saskatchewan wheat and barley producers to vote on directors for the two commissions by using a mail-in ballot so all wheat and barley producers could vote, and he should continue with that high standard by respecting the results of the farmers’ votes.
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Background: Public Plant Breeding compared to private sector plant breeding
Ottawa has farm groups chasing their own tails
NEWS RELEASE
October 14, 2014
Ottawa has farm groups chasing their own tails with transportation consultations
(Pelly, Saskatchewan) Ottawa’s latest consultation on grain transportation appears to have farm groups chasing their own tails while ignoring the real culprits in the grain marketing debacle observed Kyle Korneychuk spokesperson for the non-partisan Canadian Wheat Board Alliance.
Instead of recognizing the conflict of interest built into the system which allows inland terminal companies to also own port terminals, and in some cases grain ships, Ottawa has diverted the attention of many farm groups into wasting their time participating in a Canadian Transportation Agency consultation asking for input on what advice to give to the Minister of Transportation on the “minimum [grain] volumes the railways should move.”
“Our analysis, which was supported by other independent analysts at the University of Saskatchewan Grain Summit earlier this year shows that the grain companies are responsible for the grain marketing catastrophe that was a result of ending the farmer-controlled Canadian Wheat Board.”
Even in times of bumper crops the farmer-controlled Canadian Wheat Board never had to pay significant demurrage because ships were waiting to get a load of grain.
“Meanwhile” observed Korneychuk “the opposition is playing ‘gotcha’ politics over whether the rail fines are daily or weekly. Farmers already know Minister Ritz’s word is worth nothing since he promised us a vote on killing the Wheat Board before the last election and then went back on his word.”
Korneychuk questioned the idea of forcing the railways to move an arbitrary tonnage of grain. “This does not help farmers” he explained “the elevator companies control what happens, and dictates from Ottawa to the railways do not change the fact the grain companies have made record profits because of their new position as middlemen between farmers and the international grain market – a fact even the private sector supporters of the FNA proposal to assume control of Ritz’s crippled wheat board acknowledge.”
Korneychuk said there is a need to recognize that killing the single-desk Canadian Wheat Board has allowed the private grain companies to insert themselves as middlemen between farmers and their former customers. “With the single-desk farmers got better than 90% of the world grain price by using their single-desk marketing agency and it did an exceptional job of managing the logistics of a constrained rail and grain handling system in an efficient and equitable way.”
“With the single-desk farmers had the market power to not only extract the best prices but they also balanced off the natural monopolies in grain handling and transportation” Korneychuk concluded, “and it benefited western grain producers for 79 years by allowing them to retain the beneficial ownership of their grain, sell directly to end-use customers, and manage delivery logistics. The multi-billion dollar grain robbery perpetrated by the grain companies last crop year demonstrates that Minister Ritz’s promises of competition in the grain industry benefitting farmers were simple-minded delusions.”
CWB Audit Missing In Action
(Pelly, Sk., June 17, 2014) Farmers are wondering why the Minister of Agriculture has failed to meet the legal deadline for filing the 2012-2013 Audited Statement for the Wheat Board he created. “With the chaos in grain marketing this year and a $17 billion dollar class action law suit over the destruction of the farmer-controlled CWB, this delay raises concerns about why the Minister of Agriculture is withholding the Audited Statement for his version of the Canadian Wheat Board,” said Kyle Korneychuk spokesperson for the CWBA, a prairie wide farm group.
“The CWB Act requires the Minister to release this document no later than fifteen days after it is submitted to him on March 31 so farmers are starting to wonder what the Minister is hiding” observed Korneychuk.
“At the time the Minister killed the farmer-directed CWB it had over $120 million in cash and substantial capital assets all paid for by farmers and they have a right to know how much of this has been pledged against the announced capital expansions and how much has been used in transition and planning costs by the Minister’s appointees,” said Korneychuk, a former farmer-elected CWB director.
Korneychuk went on to say “farmers also have a right to see if Minister Ritz’s appointees are actually attending meetings, and what their travel and other costs amount to.”
Korneychuk also noted there is an outstanding Class Action Law Suit before the Federal Court of Appeal amounting to $17 billion dollars and said he “would expect that this amount will be increased as a result of the grain sales debacle we have seen this crop year and an honest assessment of the CWB’s operations should take this into account.”
“Billions of dollars of excess profits have been taken from farmers by the private grain trade,” said Korneychuk, “so we wonder just how badly his cronies running the CWB have bungled their obligations to farmers.”
Korneychuk concluded “for the first time since the last failed experiment with dual marketing between 1935 and 1942 the Canadian Wheat Board has become a significant drain on public finances and the liabilities it faces in the future need to be clearly accounted for.
Have Minister Ritz and his appointees used the Government of Canada credit card responsibly and how much are tax payers on the hook for? By failing to table a full and transparent audited statement on the operations of his creation, Minister Ritz is inviting speculation that he and his appointees have something substantial to hide. It is time he obeyed the law and tabled the information.”
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Video link
