The Militant(logo) 
    Vol.61/No.12           March 24, 1997 
 
 
Big Business Pushes Attack On Canada Wheat Board  

BY MICHEL DUGRÉ
MONTREAL - About 80,000 Canadian prairie farmers who have grown barley in the last three years are currently waiting for the results of their mail-in vote on a proposal to end the Canadian Wheat Board's (CWB) sales monopoly on malting and export barley. Beyond its immediate importance to barley producers, the plebiscite is widely seen as a test for the board's monopoly on sales of wheat, the dominant crop in the region. The results of the vote should be known by mid- March.

Officials in the capitalist governments of grain exporting countries, in particular the United States, as well as owners of the small number of giant grain trading companies who control the world market, are closely watching the debate taking place among farmers in Canada on this question. For the biggest capitalist players in the world grain trade, destruction of the wheat board would eliminate an important competitor in international markets and open the door to expanding their operations within Canada itself. Some of them are already following in the footsteps of Cargill, the world's largest grain company, in expanding their Canadian operations.

ConAgra, the world's fourth largest food company, has recently opened a Winnipeg office and announced plans for building three huge grain-handling facilities in Saskatchewan. General Mills has built a large grain facility in Sweetgrass, Montana, in partnership with the Alberta Wheat Pool. The crossing at Sweetgrass is the busiest Canada- U.S. border point between Washington state and Minnesota. "A shift to north-south shipping patterns, [and] the North American Free Trade Agreement" were factors cited by the company for building this facility. But the hoped-for end of the CWB's monopoly on wheat and barley exportations is no doubt a big factor in these initiatives.

Meanwhile, U.S. Department of Agriculture officials are threatening to renew a farm products trade war with the use of export subsidies. Their main target remains their European rivals. But "you are going to see much more focus by us on state trading enterprises," such as the Canadian Wheat Board, said John Keeling from the American Farm Bureau in January.

Wheat board restricts competition
Since the 1940s the CWB has been the sole exporter of Canadian wheat and barley. The board has a monopoly as well on domestic sales of malting barley and of wheat for human consumption. Under the CWB system, the grain elevator companies act as collectors of board grain, but they do not actually purchase or market it. Their capacity to profit from competition among farmers in the marketplace is thereby severely restricted.

The returns from board sales over each crop year are shared among the 120,000 or so prairie producers, who are paid the same price per metric ton for wheat or barley, whatever the total size of their production. Under this pooling system, smaller producers receive a certain level of protection against competition from large farmers.

The CWB's "pool pricing" system has been under growing attacks over the last quarter century.

In 1974, the board's monopoly on domestic feed grains was ended by a Liberal government, introducing a domestic dual pricing system for those grains. This initiative was prominently supported by the United Grain Growers (UGG), an elevator company with its origins in the early cooperative movement, as well as by the Cargill and Winnipeg-based Pioneer grain companies, and the provincial stock growers' associations, representing the interests of capitalist ranchers. Oats were completely removed from the board's jurisdiction by a federal Conservative government in 1989.

The Canadian government officially calls for maintaining the board's current jurisdiction over barley and wheat. But a Western Grain Marketing Panel set up by Agriculture Minister Ralph Goodale in 1995 was carefully selected to deliver a report hostile to the board, sparking a series of farm protests last summer. Aiming a blow at price pooling, Goodale has placed legislation before the House of Commons that would permit the board to buy grain at spot market prices outside the pooling system.

Meanwhile, the Alberta Barley Commission, the Western Canadian Wheat Growers Association, and 21 individual farmers are taking court action against the CWB, claiming that the CWB Act violates their rights under the Canadian Charter of Rights and Freedom. Farmers, they argue, should be free to sell their grain either through the CWB or directly on the open market through a so-called "dual marketing" system. The case is about opportunity and choice, the plaintiffs' lawyer, Keith Groves, told the court.

The 180 participants at the January 1997 convention of the Western Canadian Wheat Growers Association, which speaks for larger farmers, voted to raise CAN $100,000 ($US73,040) to advertise their opposition to the CWB before the plebiscite on barley marketing. The convention adopted a resolution calling on farmers to deal only with elevator companies that support an end to the wheat board monopoly.

The wheat and barley growers have been joined by the Reform party and the Alberta Conservative government in campaigning against the board; Alberta accounts for about half of prairie barley production, which is a staple of the province's large cattle industry. UGG and Cargill have also been active in the campaign against the CWB.

`Farmers for Justicé aids big growers
Among the campaigners against the board, the Canadian Farmers for Justice, founded in 1995, has received broad publicity in the big-business media. "Loosely affiliated by a network of fax machines, computer modems and a shared determination to break the board's monopoly, the group's 2,000 members are the guerrilla fighters of the grain wars," wrote David Lees in the March 1997 issue of The Financial Post Magazine, in an article that gave the group sympathetic coverage.

The principal tactic of Farmers for Justice has been assembling convoys of grain trucks at Canada-U.S. border points, with the aim of defying the wheat board system. In its most recent initiative, the group claims to have signed up 200 farmers for such a convoy, with the aim of involving 500 in the border-crossing event. "When they have a massive number of people, they're going to break the wheat board's monopoly," said Jim Pallister, a Manitoba farmer who advises the organization.

Farmers for Justice represents the interests of large farmers, who stand to gain competitive advantage over their smaller neighbors with elimination of the wheat board system. Mobilized in their ranks as well are smaller producers who believe their proximity to the border would allow them to prosper through serving U.S. "niche markets." The National Farmers Union (NFU), with a membership of about 10,000 based among small and medium-sized producers, has described the farmers organizing border-crossing protests as "foot soldiers and pawns serving the hidden agendas of the multinational grain corporations and the North American commodity exchanges."

Farmers for Justice has called on producers to boycott the three Wheat Pool elevator companies on the prairies to protest the Pools' support for the wheat board. The three Pools have their origins in farmers' fight earlier in the century for price pooling. The Saskatchewan Wheat Pool actively lobbied for a pro-board vote in the months leading up to the barley plebiscite. For the Pools, the wheat board monopoly helps to protect their major share in the prairie grain handling system. Today they are ill-equipped to take on the international grain marketing function performed by the wheat board, and are unprepared to compete in the open market with fully integrated grain marketing monopolies like Cargill or ConAgra.

Also defending the wheat board's current powers is the Saskatchewan New Democratic Party government, testimony to the weight of the powerful Saskatchewan Wheat Pool within the social democratic party.

Gains won't be reversed without fight
"The Canadian Wheat Board and the system of compulsory price pooling it embodies won't be given up without a fight," Saskatchewan grain farmer Howard Brown said in a recent interview. "Compulsory pooling is one of the core gains the farmers' movement has fought for and defended over the decades.

"Defense of the wheat board was a main theme in the big rally of 13,000 farmers held in Saskatoon four years back," Brown said. "That was part of beating back an attack on the board by the Tory government of the day. This past summer saw a series of smaller but substantial rallies and picket- line actions in defense of the board across the prairies. Those actions no doubt led Ottawa to exercise some caution in its plans for weakening the pooling system."

Many of the wheat board's defenders pose their arguments in nationalist terms, as though working farmers had some interest in defending "our homegrown" grain companies from "outsiders" like Cargill. Their debates imply working farmers should aim to more effectively compete with farmers abroad. "An organization like the CWB ... ensures the money stays at home," said Saskatchewan Agriculture and Food Minister Eric Upshall, for instance.

"The big merchants in grain want the grain marketing monopoly to themselves," says Brown, "and from our standpoint it makes no difference whether they're based in Minneapolis or Winnipeg. Price pooling gets in the way of the private trade in setting farmers in competition with each other to drive down farm prices. Instead, it helps to unite producers against corporate agribusiness."

Many board defenders, as well, attempt to paper over the conflicting interests that divide large farmers from small and medium-sized producers. "We all have to keep together. We can't afford to crack up. If we fragment our market to where we're all just individuals, we'll all lose," said Lorne Hehn, the CWB's chief commissioner.

"The reality is that the price pooling gets in big farmers' way in asserting their competitive advantage over their smaller neighbors," said Brown. "Their so-called `right to sell their own grain' is nothing more then their `right' to eliminate smaller rivals. The board marketing system doesn't prevent the larger farmers from using their capacity to deliver grain in volume to get preferential treatment in grading, dockage, trucking charges, and so on. But it forces them to accept the same basic price for board grains as ordinary farmers get. And in that sense, as well, the fight to defend price pooling draws class lines in the countryside."

The battle over the Canadian Wheat Board reflects the growing class polarization in Canadian politics that flows from the deepening crisis of the capitalist economy. The attack on the board by the private grain trade and its allies among big farmers is part of the generalized offensive by big business against the rights and living standards of workers and small farmers alike.

The CWB is one of the social advances made by working people in resisting the impact of the 1930s Great Depression and World War II. With other gains such as unemployment insurance, social welfare, and the Canada Pension Plan under growing attacks, workers defending their social wage can count on allies among the farmers currently defending the CWB. The class tensions emerging in the countryside will not be solved by the current plebiscite on barley. The CWB will remain an important political question in Canadian politics over the next period.

Michel Dugré is a member of the International Association of Machinists.  
 
 
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