Bill C-18 (Historical)

Marketing Freedom for Grain Farmers Act

An Act to reorganize the Canadian Wheat Board and to make consequential and related amendments to certain Acts

Part 1 of this enactment amends the Canadian Wheat Board Act to change the governance structure of the Canadian Wheat Board and to make other changes in preparation for the implementation of Parts 2 and 3. Part 2 replaces the Canadian Wheat Board Act with a new Act that continues the Canadian Wheat Board and charges it with the marketing of grain through voluntary pooling. Part 3 provides for the possible continuation of the Board under other federal legislation, while Part 4 provides for its winding up if no such continuation occurs. Finally, Part 5 provides for the repeal of the new Act enacted by Part 2.

Marketing Freedom for Grain Farmers Act

[Robert Sopuck, Conservative, Dauphin—Swan River—Marquette, MB]

Mr. Speaker, my hon. friend is exactly correct. Specialization and selling it to niche markets and doing things that no one else is doing is the way to success for a small business.

I have been privy to some commercial secrets from some constituents of mine, so I cannot talk too specifically, but we have a market now that is searching for authenticity. Therefore, prairie homegrown grains, making a niche, outstanding micro-products that can only be purchased in one or two spots will be very attractive in this new marketplace.

[Claude Gravelle, NDP, Nickel Belt, ON]

Mr. Speaker, I rise today to stand proudly with our farmers and my party in opposition to this very bad bill that would dismantle the Canadian Wheat Board.

In recent weeks, we have seen the powerful symbol of farmers with tape on their mouths to symbolize that the Conservative government is not listening to them. However, we, in this party, along with others, have heard our farmers. Here in Ottawa and across the prairies, farmers are rising to say no to this. It is time to stop this Conservative steamroller that is bent on doing the bidding of the agribusiness giant corporations.

Western farmers are being taken for granted. As my hon. colleagues from Churchill and Winnipeg have said, the recent CWB plebiscite indicated that a majority of farmers are opposed to the Conservative plan. The Conservative arrogance of not supporting those farmers is an indication of the way in which the government is failing to listen to western voices.

Sadly, we see the Conservative arrogance on too many files here in Ottawa and across the country.

I saw the Conservative arrogance when I was in Washington this week. Incredibly, the Conservatives were expressing their outrage that elected members of Parliament in a democratic country were there to tell Americans that there were better alternatives for our economy and the environment than the Keystone project.

I would like to add that, since I was in Washington, I have received numerous emails from Americans thanking us for bringing the Canadian voice, the real Canadian voice, to Washington.

We see the Conservatives' arrogance and hypocrisy in defending provincial rights until provinces tell them that they are wrong about their law and order bills or wrong in destroying the data of the long gun registry.

I would like to use my time here today to speak to what this bill would do to farmers and what would be a fair position to take for our farmers. As an Ontario MP, I will also talk about how illogical it is to use what happened with the wheat farmers in Ontario and what might happen now to the prairie farmers without the CWB.

Bill C-18 proposes to dismantle the farmer controlled and funded Canadian Wheat Board by eliminating the single desk marketing of wheat and barley in Canada. Just like the provinces, when the farmers disagree with the government, they are given no choice whatsoever with respect to their decision on the CWB.

The Conservatives claim that this would benefit farmers by opening the market for them and giving them choice. This flies in the face of all the evidence we have now, with the depressed economy and market debt left behind. Left alone, it would wreak havoc on our farmers. The bill is reckless. It would spell economic hardship for prairie farmers during these tough economic times.

It is beyond me why any government representing Canadians would side with the interests of large American grain companies and assist in eroding prices and eroding market security for our own farmers.

The farmers in western Canada are much like the farmers in my own riding of Nickel Belt. They do not expect or want a free ride. They work very hard. They want to be in their fields farming, with a market that is fair to all and not to only a few. They have a right to expect fairness from the Canadian government.

Canadian farmers want to be heard. They have the right to be listened to.

In a time of economic instability, the federal government is jeopardizing $5 billion in exports and forcing grain farmers into an open market without the Wheat Board's protection.

Bill Gehl, a Saskatchewan farmer and chairperson of the non-partisan farm group, the Canadian Wheat Board Alliance, has said, “local food advocates should be concerned about the end of the Canadian Wheat Board”.

Gehl went on to explain:

Today Canadians can be confident that the grain in all the bread, pasta, and most of the beer they consume is still grown by Canadian farmers. However, if [the Prime Minister] succeeds in killing our Wheat Board, private corporations will then control our basic food stocks and will simply buy the cheapest grain they can from any source.

As an Ontario MP, I want to comment on the argument made by some Conservatives that the Ontario experience with removing the single desk can be applied to western farmers. This is truly illogical. It is comparing apples to oranges. We need to be clear: Ontario wheat farmers ended their single desk through a farmer-led democratic process.

Ontario wheat farmers produce wheat that is used for pastries, cookies and cakes and has a ready market available locally. They produce less than one-tenth of the volume of wheat that prairie farmers produce. Ontario wheat farmers sell about 90% of their product within Canada or to northern U.S.A. They have low transportation distances and costs. Worst of all, Ontario wheat farmers now pay grain companies more to handle their crops.

On the other hand, prairie wheat farmers voted in favour of keeping the CWB and face having it taken away against their will. Prairie wheat farmers produce hard red spring wheat used for bread and durum used for pasta, which does not have an extensive local market.

A crucial difference in terms of understanding the impact of this bad bill is that the prairie wheat farmers produce 80% of Canada's wheat. They also must pay freight costs to transport grain long distances to inland terminals and to ports. Prairie wheat farmers rely on the CWB to ensure fair market access for all, including users of producer cars.

Our position is clear: the NDP believes that any decision on the future of the board should be made by farmers for farmers. Grain farmers have expressed their opinion: a majority of them want to keep this single desk system. The bill should be withdrawn. Before any changes are made to the board, the government must study the impact of dismantling it and examine the effect this will have on Canadian grain farmers. Otherwise, it is gambling with the prairie economy and the income of western farmers.

Allen Orberg, a farmer and chair of the Canadian Wheat Board's board of directors, said that this government does not have a plan, has done no analysis and did not even consult farmers. He also said that the government's approach is based solely on its blind commitment to free markets. Yet here it is, about to dismantle, in just a few months, a marketing system that has been working very well for 75 years.

The facts are clear: the CWB mitigates a risk for farmers. It helps determine when and if they will get paid on time, whether they are selling their grain to the right buyer on the right day and how to get their grain to the buyer, which is a significant issue given the vastness of the prairies.

Farmers pay for the operations of the CWB from their revenue. The CWB is not a government agency or a crown corporation. It is not funded by taxpayers.

There is the example of Australia to know what is in store for our farmers when the single desk is eradicated. This is alarming to say the least. When the Australian wheat board had its single desk power, Australian wheat commanded premiums of over $99 a tonne over American wheat. However, by December 2008, it had dropped to a discount of $27 per tonne below U.S. wheat. In three short years, 40,000 wheat farmers in Australia, which had 12% of the world's wheat production worth about $5 billion, went from running their own grain marketing system and selling virtually all of their wheat on their own behalf to being mere customers of Cargill.

I recognize this bill for what it is: Conservative ideology and politics trumping what is best for our farmers and best for Canada. The CWB is currently controlled, operated and funded by farmers for farmers and the government is meddling where it is not wanted. This bill must be defeated.

[Don Davies, NDP, Vancouver Kingsway, BC]

Mr. Speaker, I congratulate my hon. colleague from Nickel Belt on a very informed and thoughtful speech.

We are talking about the Canada Wheat Board and the merits of keeping it. We have heard passionate arguments on both sides of the House, but the key question for me comes down to what the farmers of western Canada want. We know that the legislation requires that a plebiscite be held for those farmers to tell us what they want.

I have two questions. First, why will the government not honour that legislation and allow farmers to have a vote so we will know once and for all what the farmers of western Canada want, instead of hearing people say what they want?

Second, did the Conservatives, during the last election campaign, tell the farmers of western Canada that they would get rid of the Canadian Wheat Board without a vote?

[Claude Gravelle, NDP, Nickel Belt, ON]

Mr. Speaker, farmers have already indicated through their own plebiscite that they want to keep the Canadian Wheat Board, but the government does not want to bring it to a vote because it would lose that vote. I just told the member why the government does not want to bring it to a vote. It does not want to bring the issue to a vote because surely it will lose the vote and then lose face with the farmers in western Canada.

Just a while ago the member for Saint Boniface said that MPs from Quebec, Ontario and British Columbia should not be defending these farmers because we do not represent them, but the last time I was in Saint Boniface I noticed that there are no farmers there. We were elected to represent all Canadians.

The Conservative government should bring this to a vote so farmers can have their say.

[Wayne Easter, Liberal, Malpeque, PE]

Mr. Speaker, the member's answer was right on the money. The government will not allow a vote for the simple reason it knows it would lose the vote. It is that simple. The government has really violated every democratic principle in order to not allow that vote. It brought in a law to basically break the law, get around the law.

What is important to Canadians is, are we not really witnessing a government using its majority in the pathological belief that it can impose freedom by suppressing democracy? The Conservatives talk about freedom but they have taken away the freedom to have a vote on a farmer's specific institution.

Is the government really imposing freedom by suppressing democracy, and not really getting to freedom at all?

[Claude Gravelle, NDP, Nickel Belt, ON]

Mr. Speaker, I would like to first comment on the government's majority. We all know that 39% of Canadians who voted, voted for the government. That is not the majority of Canadians.

To answer the other part of the member's question I would like to quote from an email that I received from the acting executive minister of the United Church:

[T]here wouldn't be any attempt to impose dual marketing on the CWB unless a majority of producers voted for it. According to the CWB, [the minister said,] “Until farmers make that change, I'm not prepared to work arbitrarily.... They [farmers] are absolutely right to believe in democracy. I do, too”.

[Brian Jean, Conservative, Fort McMurray—Athabasca, AB]

Mr. Speaker, I cannot stop laughing down at this end because of some of the comments that are being made by the opposition.

We had a vote on May 2 on this.

Believe it or not, I represent the oil sands but there are a huge number of farms in my area. Seventy to eighty per cent of those people vote and seventy to eighty per cent vote for the Conservative Party. They have clearly indicated to me that they do not want people in Ontario, Quebec, southern British Columbia and P.E.I. telling them where to sell their grain because those people get to decide where they want to sell their grain. They feel prejudiced. In Alberta, 27 out of 28 seats are held by Conservatives and they won by 70% to 80%.

I am going to ask the member for Nickel Belt how he would feel if the roles were reversed. If his constituents were told where they could sell their nickel and all of the rest of the producers in Canada could sell wherever they wanted, how would his constituents feel about that?

[Claude Gravelle, NDP, Nickel Belt, ON]

Mr. Speaker, I am glad that the member mentioned the election on May 2. I would like to remind him again that the Conservatives were elected by 39% of the Canadians who voted. That is a long way from a majority.

I would like to quote from an email that I received from a farmer in Saskatchewan, of all places. This is from Dianne and Ken: “We are cereal and pulse growers operating 1,800 acres in southwest Saskatchewan. We have been permit holders for 43 years and have been certified organic for 19 years. We support the Canadian Wheat Board single desk selling of Canadian grains for the following reasons”.

I am sorry I cannot give the member the reasons. My time appears to be up.

[The Acting Speaker, Bruce Stanton]

It being 1:30 p.m. the House will now proceed to the consideration of private members' business as listed on today's order paper.

The House resumed consideration of Bill C-18, An Act to reorganize the Canadian Wheat Board and to make consequential and related amendments to certain Acts as reported with amendments from the committee, and of the motions in Group No. 1.

Report Stage

[Lynne Yelich, Conservative, Minister of State (Western Economic Diversification)]

Mr. Speaker, I am pleased to be here to participate in this debate today on a very important piece of legislation that our government believes will position Canadian farmers well with their businesses to capture the marketing opportunities that are open to them.

Western grain farmers want the same marketing freedom and the same opportunities as other farmers in Canada and around the world. Western Canadian grain farmers have what it takes to succeed in an open market. They have shown this very clearly in recent years with the tremendous growth of the canola and pulse industries. The government wants to give wheat and barley farmers in Western Canada the same freedom to market their products as farmers in the rest of Canada because we know this will create new opportunities for them and put more money in their pockets.

The marketing freedom for grain farmers act will give western Canadian wheat and barley farmers the freedom to market their grain as they choose. It will open up a world of possibilities for them, unlocking the economic potential of the prairie grain sector by removing the requirement that they market wheat and barley for the Canadian Wheat Board.

Many farmers have said that the monopoly of the Canadian Wheat Board has prevented them from getting the best prices for their grain. Jason Ranger, a farmer from Saskatchewan, said that one of the big issues with the Wheat Board is that there is a huge lack of transparency and they cannot see the price that it is selling their wheat. When passed, this legislation will allow western Canadian wheat and barley farmers the freedom to make decisions based on what is best for their business.

On November 9 four picketers were outside my riding office in Saskatoon protesting Bill C-18. James Findlay, an 88-year-old gentleman who lives in my riding, dropped by my office and let me know that he had approached those picketers. He told them that he was a World War II veteran that fought for Canada and fought for freedom. Mr. Findlay asked the picketers what they had done for Canada. He said he was not saying that because he thought he was better than that generation, he was just securing the liberties for which his generation fought. The poorly timed protest to prevent freedom for western Canadian wheat farmers was not lost on this veteran.

I would like to take a few moments to outline some of the key features and timelines with respect to the transition once the bill becomes law and the Canadian Wheat Board monopoly no longer operates as a monopoly. Once Parliament passes the act, western Canadian wheat and barley producers will be able to forward contract wheat and barley sales for delivery after August 1, 2012. As well, grain companies, end users and the Canadian Wheat Board will all be able to offer farmers contracts for delivery after August 1, 2012, and western Canadian producers will be able to sell future contracts for wheat and barley with delivery dates after August 1, 2012.

I am pleased to say that the Winnipeg exchange has announced its plans to offer new Canadian wheat and durum contracts if the legislation is passed. After that date of August 1, 2012, western Canadian farmers will be able to deliver wheat and barley to any domestic or export buyer. Export licences will no longer be required. At the same time, a new voluntary check-off will be put in place to support research and market development and it will be collected at the point of sale.

The new wheat board will have the ability to buy wheat and barley and pooling arrangements, but other details such as terms of delivery and requirements for prior contracting will be communicated by the wheat board as it develops its plan for operating voluntarily. The 2011 and 2012 pool accounts will be closed in the usual way and final payments should be issued by the end of 2012.

Farmers and members in the grain value chain have also expressed concern about the ongoing availability of producer cars as well as the overall grain handling and transportation system in a marketing freedom environment. I would like to address this issue.

The government is in agreement with recommendations made by the working group on marketing freedom. Through this group the government heard from more than 50 organizations and received 20 written submissions from representatives from all aspects of the grain value chain.

The working group recommended that the reform of Canada's grain marketing approach must be aligned with and supported by the modernization of the Canada Grain Act and the Canadian Grain Commission, as well as timely implementation of the government's response to the rail freight service review. That makes sense.

The working group also recommended that the government give market forces every opportunity to work, which we are very pleased to do.

Contractual arrangements between terminal operators and non-terminal companies have worked successfully for other crops. We expect that facility owners will actively seek arrangements for additional grain volume and profitability.

To address anti-competitive behaviour, the government is considering a range of options, including working with the value chain to monitor any anti-competitive behaviour or systematic issues should they arise. The grain value chain will also continue to have access to long-standing tools, including the Competition Act and the Competition Bureau.

The marketing freedom for grain farmers act will not cause a change to the current state of access to producer cars.

The right to producer cars is set out in the Canada Grain Act and the Canadian Grain Commission allocates these cars to producers. We will continue to protect this access.

It is important to point out that most producers have used producer cars but only if the returns are higher than if they were to deliver directly to a primary elevator. Currently, only about 4% of western Canadian grain shipments are shipped by producer cars.

Short line railways and inland terminals will continue to play an important role in getting western Canadian wheat and barley to both domestic and international markets.

Members of the House will be interested to know that when the government's response to the rail freight service review is fully implemented, it will give producer car shippers the ability to establish service agreements with the railways, promoting more predictable and efficient service.

As we announced in March 2011, the government is implementing its response to the rail freight service review with a view to improving the performance of the entire rail supply chain.

We will initiate a quick facilitation process with shippers, railways and other stakeholders to negotiate a template service agreement and streamlined commercial dispute resolution process. We have recently appointed a facilitator to lead this important work.

As well, we will table a bill to give shippers the right to a service agreement to support the commercial measures.

Our government will also establish a commodity supply chain table to address logistical concerns and develop performance metrics to improve competitiveness. We will do this by involving supply chain partners that ship commodities by rail.

In collaboration with Agriculture and Agri-Food Canada, Transport Canada will lead an indepth analysis of the grain supply chain to focus on issues that affect that sector and help identify potential solutions.

We have announced a crop logistics supply chain. This will be a forum for the agricultural value chain to consider the performance of the supply chain for all crops and to exchange views and information on issues arising from the transition to marketing freedom.

We will leave no stone unturned in our efforts to ensure an orderly transition to a system that will allow western Canadian wheat and barley growers to market their wheat in the way they think is best.

Sylvain Charlebois said, “The end of the monopoly will benefit the Western agricultural economy as a whole”. Our government agrees. The end of the monopoly will benefit the western agricultural economy as a whole.

Our government is committed to delivering on our longtime promise to give western Canadian grain farmers the marketing freedom they deserve.

Last week a gentleman by the name of William Cooper attended a formal agriculture committee hearing held in my riding of Blackstrap. The topic was “How young farmers cope”. Witnesses had to be under 40 years of age. The observation that William Cooper made was, “Every witness under 40 year noted that 'They would not include CWB grains in their 2010 rotations because there was no way to manage risk'. They were talking over $200.00 per acre input costs at seeding time and had to have contracts on a portion of their acres, which they could achieve by seeding canola, oats, peas, or feed grains contracted with Pound-Maker feedlot or ethanol plant. Their bankers understand contracts but they do not understand the CWB pool return outlook”.

The other interesting item was that the Canadian Wheat Board monopoly discourages value-added investments. Stats Canada reported--

[The Deputy Speaker, Denise Savoie]

Order. The hon. minister of state's time has lapsed. Perhaps she will be able to add remarks during questions and comments. Questions and comments.

[Dennis Bevington, NDP, Western Arctic, NT]

Madam Speaker, I want to thank my colleague for her speech on this very difficult subject.

The minister of state did talk a lot about the transportation system. Working on the transportation committee in the past and talking with the various producers in western Canada, it became clear that size matters with the railways, that the opportunities to move grain, or other agricultural products, effectively and efficiently in western Canada are linked directly to volume. The opportunities for small producers have turned out to be not so good

The minister of state talked about all the wonderful things that the government is going to try to do to improve the rail service agreements. How can she guarantee success in this regard for those small farmers who are going to be on their own?

[Lynne Yelich, Conservative, Blackstrap, SK]

Madam Speaker, that was addressed in my speech, about the producer cars and such.

If the member's concern is about the farmers selling their grain, like ours is, there are many farmers who will find their markets. One of the areas that I was starting to talk about was the value-added investments.

For the first time in western Canada, a pasta plant—

[The Deputy Speaker, Denise Savoie]

Order, please. Could I have some quiet while the minister of state is speaking. I would ask members to please take their conversations outside to the lobby, if they wish to continue them.

The hon. Minister of State for Western Economic Diversification.