|Australia example touted by Canada’s ag minister|
|Local Content - Local Agriculture|
|Written by Trevor Busch|
|Thursday, 15 September 2011 14:56|
As debate continues to heat up over the intended removal by the federal government of the Canadian Wheat Board’s (CWB) single-desk marketing structure, Agriculture Minister Gerry Ritz isn’t backing down from a decision he said will be of benefit to all farmers in Western Canada.
Speaking last week during a press conference at the conclusion of the 36th Cairns Group (CG) Ministerial Meeting in Saskatoon, Sask., Ritz applauded the support given by the group for removing the CWB’s nearly 77-year monopoly on grain marketing.
“Canada is very pleased to accept the Cairns Group’s support for our domestic decision to open our wheat, durum and barley markets. I had a great opportunity to sit down with Craig Emerson (Australian Minister of Trade) to discuss the benefits and economic opportunities for farmers when they are not controlled by a single desk, looking at the Australian model,” said Ritz.
The Cairns Group is a coalition of 19 agricultural exporting countries with a commitment to strengthening agricultural trade. This year’s conference was held in Saskatoon from Sept. 7-9. The CWB recently released the results of its own producer plebiscite, which showed 62 per cent of grain producers desire to keep the single-desk marketing structure, while 51 per cent of barley producers voted in favour of retaining the CWB grain marketing status quo.
Ritz lauded the example of Australia, whose decision to remove the Australian Wheat Board’s single-desk marketing structure has provided apparent benefits to that nation’s wheat producers.
“Once again, I heard that Australia’s grain industry is thriving in a free and open market. In the years following deregulation, the number of export markets has more than doubled. There are now more than two-dozen organizations accredited for wheat exports, and many new jobs have been created. Most notably, wheat production reached record levels of 26 million tonnes last year, far and away above the previous 10-year average of 20 million tonnes. Our government remains focused on our economy, in which agriculture plays a vital role. Like Australia, an open market in Canada will drive innovation, encourage investment, create value-added jobs and give Western Canadian grain farmers the marketing choice they want and deserve.”
Australia’s Trade Minister, Dr. Craig Emerson, who also co-chaired the CG meeting, spoke of the benefits an open market for grain marketing has brought to Australia.
“The Australian experience has been unambiguously good. It’s been very good for Australian wheat farmers. The Productivity Commission in Australia did a report, and it described, on the basis of evidence given by our farmers the transition has been, I quote, ‘Remarkably smooth.’ ” In moving from a monopoly situation to a competitive situation, there were not disruptions for farmers — quite the opposite, it was a remarkably smooth transition. One consequence of having so many traders in the market is that Australian wheat used to be exported to 17 countries — it is now exported to 41 countries.”
The argument often tendered by the CWB that removal of the single-desk system will mean exchanging one monopoly for another by multi-national grain marketing companies, hasn’t been the experience in Australia, according to Emerson.
“I think farmers, more than anyone else, appreciate the benefits of diversification — they have multiple options as to where their wheat is sold, and that is what the creation of a multiple trading environment has done. And in fact, they didn’t go to one, or two, or three, or four traders — it went from one to 26, in a very short period of time. What that says is there is money to be made in putting your best food forward for farmers in terms of the other services that are being offered by these wheat marketers.”
Emerson offered his full support for removing the single desk, something he asserted has been to the benefit of the majority of grain producers in Australia.
“I can highly recommend the experience of Australia in terms of wheat marketing. There is no call to go back, to turn back the clock, because even those that were apprehensive or outright opposed to move from a monopoly marketing situation with the Australian Wheat Board, now realize it’s a done deal. I’m not saying that every person in Australia would fully endorse it, but what I would say is that it has overwhelming support in the farming community. And no one, but no one, is seriously arguing that we turn the clock back. It’s been one of the great reforms in Australia, and I’d certainly recommend it.”