Myth 1: The CWB can add value in an open market

There is no open market, only a private market dominated by five giant companies. Since the CWB has no port facilities or capital base, it would be forced to go cap in hand to these companies asking for their help to deliver on CWB sales. Why would they help a competitor? How could the CWB hope to get a premium price when they have no assured supply of grain, no real knowledge of what grades are available and no idea of the volume of grain they have to sell?  Without the single desk, there is little value that the CWB could add to farmers’ grain.

 

Myth 2: Producer cars will survive 

Farmers have a right to order a producer car, but to ship it they need to have a sale for the grain and space in a port terminal to store it. Why would those terminal owners undercut their own handlings to accommodate producer cars? The answer is they won’t! (and, they don’t right now!) That is why more than 95 per cent of producer cars carry Wheat Board grain. The CWB has the commercial muscle to access space in port terminals.

 

Myth 3: We’ll get better returns in an open market

Under the Canadian Wheat Board Act, our Board is not allowed to have any “retained earnings.” In plain English, this means our Board must return all its sales revenue, minus operating costs, back to farmers. According to both the Auditor General of Canada and the annual Deloitte and Touche audited statements, that is just what happens: more than 98% of sales revenue goes back to farmers.

 

With all their bankers, shareholders and expensive executive bonuses, no private corporation can possibly match the CWB’s return to farmers.

And what about premium prices?  Fourteen International Trade Tribunal Investigations and numerous peer reviewed academic studies have all concluded that the Wheat Board does get premium prices for farmers. Even U.S. farm leaders, like Robert Carlson of the North Dakota Farmers Union are convinced that the CWB earns Canadian farmers big premiums compared to U.S. Prices. Too bad our own Agriculture Minister is not paying attention.

 

Myth 4: An open market will lead to transparent pricing

When you settle on a price to sell your canola, do you know where it goes or what it is used for? Nope! That is all a (sales) secret which the brokers keep to themselves. Some canola goes for oil, some for meal and, some for highly specialized industrial applications. It all sells for different prices, but the farmer only sees one price. That’s what happens with do-it-yourself marketing.

The difference between a marketer and a price taker is huge. A marketer, like the CWB, develops relationships with customers. The private trade only makes an offer to sell to end use customers.  Then, private traders go to farmers and offer them a lower price to source  the commodity they have already sold.  This is called margin trading. As a price taker, the farmer always loses and often the customer is not entirely satisfied either.  That is why western farmers chose to cut out the middle man by establishing their own sales department, the CWB, to market their own grain.  It works so well the private trade has been howling for its blood ever since.