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Legislation Passed that Ends CWB Marketing Monopoly

Farmer-elected directors of the Canadian Wheat Board say they have launched legal action to stop implementation of what they consider illegal federal legislation to end the Wheat Board’s monopoly on marketing of wheat and barley.

Shannon Schlect of U.S. Wheat Associates has been monitoring the developments north of the border.

"The House of Commons has passed the legislation and it is in the Senate for a vote I believe later this week," Schlect said. "There is the court case that was the ruling last week that could throw a little bit of a monkey wrench into the timing, but I think all indications are that the Canadian government has campaigned on this issue of market choice and freedom and they are doing everything they can to move it forward."

Late Thursday night the Canadian Senate did pass the bill, and Governor General David Johnston gave the bill royal assent shortly after with the government proclaiming the bill. That means the farmer-elected directors of the CWB are out of their jobs and farmers can begin forward contracting their grain sales with whatever grain company they wish. The actual monopoly won't be lifted until August 2012.

Schlect says an end to the Wheat Board’s marketing monopoly would impact Canada’s competitive position as a world exporter, but could also mean more Canadian wheat and barley could be shipped to the United States.

"There definitely could be more Canadian wheat moving in, I don't think we can say that is not a possibility," Schlect said. "But the important thing is that those trade movements are going to based on market conditions and economic conditions where we are competing on the same playing field, which is not the case with the Canadian Wheat Board and the monopoly status."

The next steps for the bill are in doubt, however, as a court prepares to hear a case from the CWB requesting an injunction against the bill being implemented. The request was filed in Manitoba court Wednesday and the first hearing is scheduled for Friday.