Thank you, Mr. Chairman , and welcome.
For those of you who don't know it, the chairman of the committee is my MP. Hello, Mr. Ritz.
Mr. Chairman and agricultural committee members, my name is Ken Ritter. I'm a farmer from Kindersley, Saskatchewan, and it has been my pleasure to serve as a farmer-elected board member and chair of the CWB board since 1999. With me today is Adrian Measner, the chief executive officer of the CWB.
I wish to thank the committee for providing us with the opportunity to appear before it today. I know the committee has a lot on its plate, and it is reassuring to know that among the many concerns it must address, there is appreciation for the significant role that the CWB has to play in the future of the Canadian grain industry, particularly in western Canada.
In spite of the recent increase in commodity values, agriculture and grain production are in a state of crisis. Farmers are facing margins that stretch their reserves of equity, their resolve, and their ingenuity. Against this backdrop of economic hardship, what is the best marketing system that will serve farmers' needs in wheat and barley?
There was a time when I, like the Conservative Party of Canada, would have said it was the dual market; in other words, farmers could sell either through the CWB or directly into the private trade. Put in place a voluntary CWB, I would have said, because it will make the CWB more cost-efficient and it will give farmers more choice.
I would have said that eight years ago, but I wouldn't say that now.
I've changed my mind about the CWB's role as a single-desk seller for a variety of reasons. First of all, I've seen evidence of CWB sales bringing higher returns than our competitors. At each board of directors meeting, a binder is put at the director's disposal. In that binder, records of the sales that the CWB has made are placed side by side with those of our chief rivals. This is valuable information. It enables me and the other farmer-elected directors to ascertain that the single desk is indeed being used to add value for Prairie grain producers, but it is also information that is commercially sensitive, both in terms of our relationship with our valued customers and in terms of our many competitors. This is why the binder stays in the boardroom, and why we don't broadcast its contents. Let me state categorically that these records offer solid proof that the CWB is getting more for the grain it sells on behalf of Prairie farmers than other sellers are getting.
I don't know of many farmers who can afford to leave those dollars on the table, especially not in today's farming environment. As a farmer, this is my bottom line. I want to know if I'm getting more because of the CWB, or if it's working against me. I have seen the CWB earn significant premiums for me and the other wheat and barley farmers on the Prairies, and I have understood that the major reason, apart from the courage and tenacity of the producers who grew the grain, is the single desk.
Secondly, I have seen evidence of another factor that is just as compelling as the first: consolidation in the grain industry. Everyone, from the grain companies to the railways to our competitors, is getting bigger and more powerful. In light of this, what should we do here in western Canada? Clearly, we have to ramp up and keep pace with them; otherwise, we will find ourselves shut out of markets, out-negotiated, and stuck with a uncompetitive cost structure.
What tool, other than the single desk, do we have at our disposal to get this done? There are none. Grain companies that at one time were farmer-owned and farmer-run have almost entirely disappeared from the Prairie landscape. Today's producers have more faith in the CWB to act in their interests than they do in multinational grain companies to do so.
Both of these advantages--the ability to attract premiums, and the strength to go toe to toe with the world-class heavyweights in the grain industry--are predicated on the single desk. The notion that you can have a dual market with a strong, effective CWB is quite simply misguided. It can't work. The second the CWB is voluntary, the single desk disappears, and with it the benefits I've just outlined. The true choice that farmers face is between the CWB and an open market. Given those choices, the preference of farmers is overwhelmingly to retain the CWB and the single desk.
Lastly, I've seen how we, as farmer-elected directors, can push for changes to the single-desk system, changes that accommodate farmer choice and farmer freedom. The producer payment options we put in place are major accomplishments that give the farmers who want it greater control over pricing their grain, while maintaining the advantages of pooling and single-desk selling for all the others.
I know the term “dual market” means different things to different people. I believe it arose from the days when the CWB was government-controlled, secretive, and lacked both accountability and choice. But those days are gone. Grain producers can now have both market power and greater control over their own marketing choices. However, the CWB and farmers cannot have market power without a single desk that in turn allows them to offer these exciting new choices. These kinds of changes take time. They take a lot of innovation and education, but they bring with them the best of both worlds: the opportunity for an open market and the risk management and premiums the CWB has always provided.
The alternative is not a dual market. It is an open market where the CWB would be rendered ineffective, and producer choices would be to sell to a handful of multinational grain companies who would then effectively control marketing of all grain.
All this is not to say we are complacent at the CWB. As I stated, we have undertaken many changes to make our organization more efficient, more responsive, and more flexible for farmers. We have a business strategy now for even greater and more dramatic changes within the existing framework to further enhance returns to farmers and to place the CWB completely under their control.
I am fully aware the Conservative Party of Canada has pledged to make marketing voluntary through the CWB, and I fully appreciate that the government now feels obliged to deliver on its election promises. But on behalf of the many farmers in western Canada who, like myself, have seen clear-cut evidence of a need for a single-desk approach to marketing wheat and barley, I call upon the government to recognize that this issue is one where farmers should have the final say. It's our industry, it's our money, and it's our future. It should be our decision. If there are to be significant structural changes to how they market their wheat and barley, those changes should be put to farmers in a plebiscite. This is an opinion held by the vast majority of prairie grain producers. It is therefore the CWB's position as well, and clearly the requirement outlined in the CWB Act.
Thank you.