The Issues

The Canadian Grain Commission (CGC) works to assure the highest standards of quality for Canadian grain products and ensure fairness for grain producers. This important mission stands threatened by the federal government which has tried and failed in the past to gut the CGC.

Currently, proposals that would harm producers are back on the table, this time in the form of a public consultation which most think is just the first step in a new campaign by the Harper Conservatives to attack Canadian grain producers.

Background on the Canadian Grain Commission

The Canadian Grain Commission (CGC) has served as an independent arbiter, working to settle disputes when they arise about the quality and quantity of grain producers bring to market. Typically, this function protects producers and makes sure they are fairly paid by the powerful companies which buy and export.

Canada’s reputation for top quality grain is protected by the grain inspection services supplied by the CGC. The Commission also provides independent, objective and comprehensive information about the quality and quantity of Canadian grain that is crucial to the international marketing efforts of the Canadian Wheat Board.

The Conservative Party’s has previously proposed to diminish the CGC dramatically by:

• Killing the Commission’s “inward” inspection and weighing service leaving producers disadvantaged in their dealings with grain companies when it comes to determining grain weight and grade. With the loss of the Commission’s weighing and grading service, producers may not be paid for the quantity and quality of grain delivered. Currently, the Canadian Grain Commission routinely revises upward grain grades and corrects quantity measurements, resulting in fair payment to producers. While producers would have the option to hire a private company to grade and weigh their grain under the Conservative proposal, no companies capable of the task exist today.
• Eliminating the requirement for grain buyers to post security bonds and expose grain producers to financial harm in the event of a grain buyer bankruptcy or refusal to pay.
• Dismantling the Grain Appeal Tribunals which protects producers and the Canadian Wheat Board from unscrupulous behaviour on the part of grain companies. In Vancouver alone, it is normal for more than 100 appeals to be launched in a day. These changes may result in increased costs to producers with the shift to a for-profit service delivery model.

The Conservative’s proposals pose a risk to Canada’s international reputation

• Our grain is in demand because no other country offers a quality guarantee backed by a system of government inspection as stringent and comprehensive as Canada.
• To protect our quality brand, Canada even has programs and procedures to prevent Canadian grain from being mixed with imported US product to ensure the integrity of Canada’s quality guarantee.
• Along with Canada’s international reputation as a producer of the highest quality, at risk is the quality premium paid to Canadian producers.
• Once this “quality incentive” to ship Canadian grain separate from American grain is lost, we expect Canadian grain will be shipped overland, mixed with the lower quality American product and shipped through US ports.
• This will have significant downstream consequences for the Canadian economy as the lucrative business of shipping Canadian grain is lost at Canada’s ports.

The Conservative proposal ignores the unanimous advice of an all-party committee of the House of Commons

• After extensive study of the future of the Canadian Grain Commission, the House of Commons Standing Committee on Agriculture made several recommendations which were supported by all parties, including the Conservatives.
• For instance, the Committee recommended CLEARLY that protecting the interests of grain producers should continue to be job one for the CGC. Yet, the Conservative Minister’s proposal would dilute the intent of the Grain Act to protect producer interests, eliminate the Grain Appeal Tribunals and the requirement for grain companies to provide security to ensure farmers are paid if companies which buy their grain go bankrupt.
• Although the committee recommended increased funding for the CGC to ensure long-term sustainability the Conservative proposal is silent on this.
• And, the committee recommended a prudent approach to change through pilot projects and detailed analysis, the Conservatives have simply ignored this by proposing aggressive cutting of regulatory responsibilities and services immediately.
• Ironically, Agriculture Minister Gerry Ritz who has launched the current consultation which ignores much of this consensus, chaired the all-party committee whose November 2006 report is described above.

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