The CWB Director Election is Important

The CWB directors’ elections are upon us.  The ballots have been mailed out.  It is now prudent to review where candidates stand and the track record of incumbents.

There are three incumbents running for re-election.  Henry Vos (District 1), Allen Oberg (District 5) and Kyle Korneychuk (District 7).

Vos is known to support positive change.  According to his election material, his vision for the CWB is “A Canadian Wheat Board where farmers have the freedom to operate and manage their businesses with relatively few restrictions.”  It also states “During his past term as a director, Henry has worked constructively for change to increase the value of wheat and barley to farmers.”

Oberg is an unwavering advocate of the single desk.  In his profile, he states “I am convinced that the single desk is fundamental to a strong and viable CWB.”

Korneychuk is also a staunch guardian of the single desk.  He states “I firmly believe that the CWB with a single desk mandate provides the largest benefits to all producers”.

The following is what occurred at the CWB during their term – since 2006:

Administration costs since 2006:

·         CWB overhead costs have risen by about $9 million (13%).

·         HR costs have risen by about $6 million (16%).  

·         Communications expense has risen by about half a million (30%). 

The Single Desk performance since 2006:

·         Premiums the CWB may have achieved were overwhelmed by other factors that kept returns at or below annual market averages.

o   Wheat pool averaged about $30.00/tonne below annual market averages.

o   Durum pool returns averaged about $7.00/tonne above annual market averages. 

o   The malt barley pool returns averaged about $50.00/tonne below annual market averages.

·         Delivery into the durum and malt barley pools was restricted.

o   08-09:  81% acceptance on durum (in a market offering well-above average prices). 

o   09-10:  52% acceptance on durum

o   08-09:  malt barley pool was closed to new selections half way through the year.

·         In 07-08, the CWB lost $226 million in discretionary trading in the pools (mainly wheat).

·         Most years, the CWB held back from the market the true value of the export market, thereby having a seriously negative impact on domestic feed barley values.  About $50/tonne in 07-08, $8.00/tonne in 08-09, unknown in 09-10, and $50.00/tonne in 10-11 (currently).

Producer Pricing Options and the Contingency Fund since 2006:

·         The CWB lost a total of $94 million in the PPOs (06-07 to 08-09; 09-10 information is not available yet).   

·         The Contingency Fund was drawn down by about $41 million. It went from a $44 million positive balance in 2006, down to a $29 million deficit in 2007-08, and back up to a $3 million positive balance in 2008-09.

·         In 08-09, the PPOs “earned” $25.00/tonne, one of the largest amounts taken from participants ever, as the CWB tried to cover the losses in the Contingency Fund.  The Early Payment Option “earned” $15.00/tonne, by far the largest amount taken from participants ever in the life of the EPO program, also to cover the deficit in the Contingency Fund.

Evidence suggests that the single desk has not generated any net benefit to farmers and has been responsible for a serious drain on the Western Canadian economy over the last four years.  

All candidates need to stand up for what they believe.  Incumbents have the added accountability of what they did while on the board to improve the CWB for farmers.  Those that are unwavering proponents of the single desk such as Korneychuk and Oberg and other new candidates need to explain why they think it is beneficial to farmers in the face of overwhelming evidence to the contrary.

These candidates have indicated they support the status quo (protecting the single desk):

District 1:             Dan Gauthier

District 3:             Lynn Jacobson, Brett Meinert and Stewart Wells

District 5:             Allen Oberg

District 7:             Kyle Korneychuk

District 9:             Garry Draper and John Sandborn

All these candidates should be asked what evidence they have that the single desk is a benefit.

From what I can gather, these candidates support change (even if it means changes to the single desk):

District 1:             Henry Vos

District 3:             Brian Otto

District 5:             Vicki Dutton

District 7:             Terry Youswa

District 9:             Ernie Sirski

All these candidates should be asked what they would do to change the CWB for farmers’ benefit.

All farmers need to take this election seriously.  I’ve heard about farmers that don’t care about the elections or don’t agree with them so they don’t bother to participate.  (Some even toss their ballots out into the garbage can in the post office.  Don’t!  There is talk that ballots have been taken out of the garbage and submitted by unscrupulous characters - you may not agree with their choice!)

Even if you don’t grow CWB grains, you are impacted by decisions and actions of the CWB and its board of directors. 

Even if you don’t believe in voting for CWB directors, your vote is important.

If you qualify, vote.

Candidate Profiles