Saturday August 23, 2014

CWB not going quietly into the night

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The demise of the Canadian Wheat Board forecast by its biggest supporters if single-desk selling powers were to be striped away seems to have been a bit overly dramatic.

Of course those who believed the end of single-desk selling would be the panacea to end all the woes of farmers with wheat, durum and barley bound for export.

It won’t be.

There will be issues regarding deliveries, sales and pricing under any conceivable system, as witnessed this year with tardy rail line service which is causing an export backlog in a year when grain supplies are massive on Prairie farms.

There is even some compelling likelihood the more disciplined approach to grain handling a single-desk seller brings to the marketplace might have aided the current situation.

Ultimately the CWB was changed by the federal government, and whether it is a great move on their part, or an impending disaster will only be fully determined by looking back after several years have transpired.

In the meantime the CWB appears to be adapting pretty quickly to the new world order it finds itself operating in.

The CWB recently announced the construction of its second state-of-the-art grain elevator. This one near Colonsay, Saskatchewan.

Situated on the Yellowhead Highway approximately 65 kilometers east of Saskatoon, the elevator at Colonsay will feature 42,000 metric tonnes (mT) of storage and is scheduled to open in time for the 2015 harvest.

“I’m excited to be able to announce the construction of our second elevator in Colonsay so fast on the heels of our Bloom elevator announcement,” said CWB president and CEO Ian White in a prepared release. “We see significant opportunity in the Colonsay area for a fast and efficient grain-handling facility that will provide the customer service that farmers have come to expect from CWB. CWB’s growing network of modern grain-handling facilities across the Prairies will provide farmers with more choice out in the country during a critical time in the ongoing transformation of the grain industry.”

The same release noted with the announcement of the Colonsay elevator, CWB’s overall asset network for the CWB now include elevators in Manitoba and Saskatchewan, Mission Terminal in Ontario, and Les Élévateurs des Trois-Rivières in Quebec. In addition, CWB’s two Equinox class laker vessels are scheduled to be operating in the St. Lawrence in 2015.

“It won’t be long before farmers driving down the highway will be able to physically see the equity that is being built in CWB. CWB’s farmer ownership plan is designed to give farmers a stake in their value chain after privatization simply by delivering against our contracts” said White in the release.

In terms of grain handling facility ownership, at least on the Prairies themselves, the CWB is a newcomer to the ball.

But it does have some assets it can utilize to gain a foothold rather quickly.

That is good news for the system which needs competition.

It’s also good for farmers to have another player at the table with their interests closer to heart than many international grain handlers with dividend-hungry investors who are far removed from farming.

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