Madam Speaker, we are just so darned proud of him but I will say the Prime Minister.
We believe that all Canadian farmers should be able to position their businesses to capture the marketing opportunities that will be open to them. We live in a free country and giving farmers the freedom to choose is the right thing to do.
Currently, by law, western Canadian wheat, durum and barley growers do not have the same rights as other producers in Canada about where and how they sell their products. For export or domestic human consumption, they have no other option but to market through the Canadian Wheat Board, the monopoly that was established in 1943 by an order in council, not by producers or for producers at that time.
By allowing marketing freedom, western wheat and barley growers will be able to market based on what is best for their own bottom line of their own business. In the June 2011 Speech from the Throne, we again stated our commitment to ensure that western farmers would have the freedom to sell wheat and barley on the open market. With this proposed legislation, we would provide marketing choice to western grain farmers once and for all.
To avoid market disruption, the goal is for farmers and grain marketers, including the new entity, to be able to start forward contracting in January 2012. Farmers, grain companies and customers need this assurance. As we well know, market certainty and clarity underpins stability in the marketplace domestically and internationally.
The bill would remove the monopoly of the Canadian Wheat Board and allow for the new Canadian wheat board to continue as a voluntary marketing organization for up to five years as it makes the transition to full private entity. During the transition period, this new voluntary organization would still be called the Canadian wheat board. It would continue to offer farmers the option of pooling their crops. It would continue to benefit from a borrowing guarantee backed by the federal government and it would develop a business plan for privatization, which will be reviewed no later than 2016.
This new freedom is not only good for farmers, it also has many economic benefits for communities across western Canada. New processing plants would be able to open their doors for business and look to hire new employees unfettered by the current ridiculous requirement to buy wheat and barley only from the Canadian Wheat Board.
Canada's grain industry is a powerhouse that brings $16 billion to the farm gate and makes up almost half of our agricultural exports. What was once Canada's signature crop, hard red spring wheat, has fallen behind. Wheat and barley innovation has become stagnate. Competition for acres has weakened and newer crops, such as canola, have surpassed wheat in value.
A C.D. Howe report released this past spring confirmed that Canada's share of annual worldwide wheat production has fallen by 50% in the last 50 years. It is a staggering number. Equally, Canadian market share and world barley exports have declined by 40% since the 1980s. With the reduced market share, the Canadian Wheat Board has less influence on the world stage and, as a result, has become a price taker.
We have seen tremendous growth in value added opportunities across the Prairies over the past 20 years for crops that do not have a monopoly marketer, including oats, pulses, flax and, of course, canola. We would see these same opportunities open up for wheat and barley as we implement market freedom. We will work with farmers and industry to attract investment, encourage innovation, create value added jobs and build an overall stronger economy.
Our government has promised western Canadian wheat and barley growers that they will be given marketing freedom. We are fulfilling that commitment and ensuring that the market is finally controlled by the experts in the grain industry, our farmers.
The Canadian Wheat Board was first imposed on western Canadian farmers when times were different, to say the very least, difficult. Canadians had just gone through the Great Depression, World War II was raging and Canada was committed to supplying wheat to Britain. It was 1943 when farmers were forced to sell through the board. It was done with the aim of aiding the war effort, not with any pretense that it would be good for farmers.
So what has changed since then? Just about everything down on the farm.
For starters, it is now 2011, not 1943. Our government remains focused on economic stability and creating the right conditions for more long-term jobs and stronger economic growth, all the while steadily eliminating the deficit and returning to surplus. Our workforce is healthy and our agricultural industry is helping to drive our economy.
Unfortunately, the one thing that has not changed is that prairie farmers are still forced by law to sell their wheat, durum and barley through the Canadian Wheat Board.
The government's position is clear: our long-standing commitment that we are now delivering on is to promise and provide marketing choice. This is why we want to continue to have the Canadian Wheat Board in place as a choice for those who want to continue marketing through the board.
For too long, barley and durum processors have been setting up shop south of the border because they could not take the red tape here in Canada.
Those who are looking for an economic analysis need only listen to the Canadian Chamber of Commerce when it says:
The current single-desk model restricts valued added investment in wheat and barley, significantly detracting the ability of farmers and industry to respond to market demands and earn a premium return in recognition of the innovation provided, including innovation in value-added processing.
That is quite a statement.
Look at what happened to oats when it came out from under the monopoly. In Manitoba alone the acreage of oats has increased by over 250,000 acres since its removal from the Wheat Board's control.
This has allowed for the opening and expansion of Can-oat, a processing mill in Portage La Prairie. A half a million tonnes a year of oats run through that facility. These are the types of value-added industries and jobs that exist when farmers have the option to market their products as they so choose.
The transition to marketing freedom will have an impact on the Port of Churchill, since the CWB was responsible for nearly 90% of all goods shipped through the port in 2010. Our government is taking concrete steps to help ensure the Port of Churchill will remain a viable option for exports.
The Government of Canada remains committed to Churchill, and we understand the importance of economic development and diversification to the community, the region and the overall north.
The government also acknowledges that the changes to the Canadian Wheat Board, while giving farmers marketing freedom, will also lead to a period of adjustment for Churchill and the surrounding region. That is why we are taking necessary steps to support the community and the port through this transition.
The government will provide an economic incentive of up to $5 million per year during the five year transition period to support shipments of grain, including now oil seeds, pulses and special crops through the port.
Working with the port owner, Transport Canada will invest more than $4 million to repair the existing port assets and support the safe docking of vessels. This will also enable the port to remain in sound operating condition to take advantage of future business opportunities, and could create jobs resulting in economic benefits to the community over the next three years.
Western Economic Diversification Canada will work with the Churchill Gateway Development Corporation on port infrastructure improvements, and extend the project completion date an additional two years, from 2013 to 2015. Additionally, the government will continue to explore initiatives to support the ongoing operations of the port.
We recognize that this is a major change for agriculture in western Canada. That is why we have been consulting extensively with stakeholders from across the supply chain, from the farm gate to seaport.
Over the summer, a working group comprising experts in the field heard a broad range of advice on how the grain marketing and transportation system could transition from the current CWB-run system to an open market that includes voluntary marketing pools.
The working group's report covers a wide range of issues from transportation to research to elevators, basically the how of moving to an open market. The basic thrust is to let markets work, but monitor them to ensure that effective competition prevails. The working group is one of many ways the government is seeking advice on how to move forward.
One of its recommendation deals with the issue of the advance payments program. This is a very popular tool farmers use to maintain their cash flow during the production season. The APP has always been delivered on behalf of Agriculture Canada by delivery agents. In order for the new CWB to focus 100% on the marketing of grain for those farmers who choose to use it, the Canadian Canola Grower Association will now administer the APP for wheat and barley, starting with the spring 2012 advance program. Canadian canola growers have great expertise and 30 years experience in administering these cash advances.
As a result of the change, many farmers will have their administrative burden reduced as they deal with fewer organizations, not to mention a potential reduction in their administration fee. Wheat and barley farmers will continue to have access to this program without disruption.
Canada's wheat and barley producers constantly adapt their operations to the evolving economic and weather realities, and their ability to secure cash flows is an essential part of their ongoing business decisions. Our government is taking clear and concise action so that wheat and barley farmers will continue to have access to the advance payments program during and after this transition to an open market.
With regard to the issue of producer cars, the reality is that the board's monopoly has never provided producer cars. The right to producer cars is set out in the Canada Grain Act, and producer cars have always been allocated by the Canadian Grain Commission, and the Wheat Board's only role was to charge a fee for the use of a producer car. Our government will continue to protect farmers' access to them.
Similarly, the fact is that short line railways and farmer-owned inland terminals succeed in their businesses on the basis of their management skills and the value they offer producers. They will continue to offer savings to farmers without the CWB monopoly. To suggest that they depend on a monopoly, forcing farmers to deal with them, is an insult to the people who operate these businesses.
These same groups offer professional and economically beneficial services to producers for non-board crops now, and they are doing very well at it.
The government is committed to improving rail service for agricultural shippers. The government completed the rail service review and we announced our follow-up actions in the spring of last year.
As for jobs, while the board will see some job losses initially, the future for employment in the grains sectors looks bright. We can expect more processors to start up new businesses in western Canada. Private marketers of wheat and barley will expand their workforces. The Western Grain Elevator Association members are already calling for and interviewing people to handle the increase it expects. Some have even committed to numbers that they will require in this new free setting.
Milling firms will be able to purchase directly from the farmer of their choice at a price and a timeframe they negotiate. Entrepreneurs will have the option of starting up their own specialty flour mills, malting and pasta plants. In fact, just recently, we had the honour of turning the sod on a new pasta plant in Regina. Murad Al-Katib of Alliance Grain Traders, born and raised in Davidson, Saskatchewan, has been selling Canadian pulses worldwide. The company also manufactures pasta in Turkey, but has stayed out of the Canadian market because of the monopoly and all the red tape involved in dealing directly with durum producers. This is a $50 million private sector investment that will create 60 permanent jobs and 200 construction jobs. He is unequivocal in saying that this would not happen without these changes. That is great news for Saskatchewan and it is great news for farmers overall. I know that there are more to come.
My colleagues on the opposite side of the floor unfortunately remain steadfast against these opportunities of an open market. Even more amazing about this opposition is that only a tiny fraction of their members represent anyone in the Wheat Board area. All of them are from city ridings. The official agriculture critics, both from Ontario, seem to think that they have the right to tell western grain farmers that they do not have the right to market their own wheat and barley as their own constituents do.
In the Ontario example, we made the announcement yesterday at Don Kenny of Blondehead Farms. He is the chair of the Ontario grain producers. We also had in attendance, Barry Senft, who is the president and CEO of the Ontario wheat board. They both recommend this change. They did it in 2003 and have never looked back.
My colleagues understand we are turning a page in our nation's great history and we will all be better for it. Exciting new opportunities lie ahead for our grain industry. The government is pleased to receive the support of this initiative from three of the four provinces shackled by the monopoly. Saskatchewan, Alberta and British Columbia produce over 90% of western Canada's wheat, durum and barley.
The agriculture minister from Saskatchewan said:
Saskatchewan farmers spend their own hard-earned money on land, machinery and inputs to grow their own crops, so why shouldn't they have the marketing freedom to decide how, when, and to whom they sell their grain?
Alberta's agriculture and rural development minister said:
Marketing opportunities are being lost every day and it's vital that Alberta's grain producers be able to market their product to anyone they choose.
As well, the agriculture minister for British Columbia said:
Every farmer in Western Canada deserves the right to sell their grain when, to whom and for the price that works best for their farm business.
The government is giving western Canadian farmers nothing more than their right to manage their own businesses their own way. While we welcome constructive debate, frivolous delays will only hurt our farmers and the overall grain industry.
We owe it to producers to provide market certainty so they can continue to plan their businesses. Farmers must plan for the 2012-2013 year. They are already putting inputs in the ground, getting ready. When they are making seeding decisions they will want to know what the marketing system will be for that 2012 crop.
Canada will continue to sell wheat and barley and maintain its reputation as a quality, reliable supplier. The international grain trade works largely on forward contracting for future purchases and sales. If there is uncertainty in the market about the rules of who can sell Canadian wheat and barley, there is a high risk that buyers will turn to other countries to buy that wheat and barley.
The Canadian wheat and barley sector can continue to supply domestic and world markets with high quality wheat and barley, but they look to us to provide the certainty they need to plan and carry out their business decisions.
I invite my colleagues in the House to join us as we work to ensure that all farmers across Canada can position their businesses to capture the opportunities of the future.