Grainnet

Winnipeg—Prairie farmers deserve objective and accurate assessments of CWB performance, CWB president and CEO Ian White said November 20.

He expressed disappointment that a new report from the C.D. Howe Institute falls far short of that mark.

"Farmers are not well served by another report based on false assumptions and oversimplified numbers," White said, adding the CWB is committed to accountability through measurable performance results, developed in 2003 and directly reported to farmers each year.

The C.D. Howe "e-brief" compares daily posted Montana elevator prices for wheat to returns from a now-obsolete CWB pricing program, claiming this serves as a window on the CWB’s overall performance.

"This represents a fundamental misunderstanding of the program and the CWB's task in marketing Prairie farmers' grain," White said.

To reach its conclusions, the paper also assumes that the entire western Canadian wheat crop could be sold into the U.S. at posted U.S. elevator values.

This is not possible, nor do posted values consistently reflect actual pricing opportunities available to farmers.

In fact, CWB pooled returns to farmers in 2007-08 were more than $1 a bushel higher than those earned by most American spring wheat and durum producers.

Using weighted average receipts published by the U.S. Department of Agriculture, the CWB estimates Prairie wheat farmers earned at least $560 million more than their U.S. counterparts.

Comparing returns is problematic, White noted, given the challenges for Canadian producers who must market their grain to a far more diverse global customer base.

The U.S. market accounts for only 10 per cent of western Canadian milling wheat sales, with 80 per cent exported overseas.

American protectionism has also made U.S. market access challenging for Canadian agricultural products, including hard red spring wheat – which was shut out of the U.S. market from 2003 to 2006 by a high tariff wall.

"American grain elevators might be located in close proximity to many Canadian farms, but our wheat economics are fundamentally different," he said.

"This would be true no matter what marketing system were in place for Western Canada."

Because U.S. spot prices are not a valid comparison, the CWB has worked to create other meaningful benchmarks, without revealing confidential sales data to competitors.

For the past four years, the CWB has used a broad set of measures developed to provide numerical performance results that are published in its annual report and mailed directly to farmers in its "Report to Producers".

"It is a priority for the CWB and its board of directors to find improved ways to demonstrate its value to farmer stakeholders," White said.

"This work will continue."

For more information, call 204-983-3101.

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