UPDATE: Wheat, Barley Farmers Back Canadian Wheat Board Monopoly
September 12 2011 - 12:09PM
Dow Jones News
A majority of wheat farmers in Canada's western prairies
supports continuing a monopoly over their crop, according to
results of an nonbinding vote released Monday.
But Canada's Agriculture Minister said his government intends to
ignore the results and proceed with its plan to dismantle the
agency in favor of more market-oriented approach.
Sixty-two percent of wheat farmers voting backed the Canadian
Wheat Board, which for 70 years has been the only seller of wheat
and barley grown in the western provinces. Barley farmers also
backed the board, but by a smaller margin, with 51% of respondents
voting in favor of keeping the monopoly. More than 49,000 votes
were cast in the plebiscite.
Results of the vote commissioned by the board come as it fights
for its future. Canada's Conservative Party captured a
parliamentary majority this past spring and plans to pass
legislation stripping the board of its monopoly power.
Gerry Ritz, Canada's Agriculture Minister, reiterated this point
in a statement released shortly after the vote results were made
public.
"No expensive survey can trump the individual right of farmers
to market their own grain," he said. "Our government is committed
to giving western Canadian grain farmers the marketing freedom they
want and deserve."
Ritz has said he expects legislation eliminating the board's
monopoly power to be introduced this fall, with passage possible by
the end of the year. The left-leaning New Democratic Party is
expected to challenge the legislation, with Pat Martin, a NDP
legislator, saying the government has yet to produce any evidence
that farmers would be better off without the board.
"This is nothing more than an ideological crusade," Martin
said.
Those who oppose the board's monopoly say farmers could capture
better returns by having the freedom to market their own crops.
However, supporters of the board say its control over western
Canada's crop gives it considerable power in global commodity
markets to ensure farmers there get the best prices.
An end to the wheat board's monopoly is likely to ripple through
agriculture in North America. Commodity exchanges anticipate that
Canadian farmers will turn to futures markets if the wheat board
goes away, and they and grain handlers already are jockeying for
the expected new business. The change also would affect wheat
prices, potentially making them more volatile.
The board hired MNP LLP, a Canadian accounting firm, to conduct
the vote. Results were originally scheduled for release Friday.
-By Mark Peters, Dow Jones Newswires, 312-750-4141;
mark.peters@dowjones.com
(Paul Vieira in Ottawa contributed to this report.)
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