Posted on March 06, 2013

by Gavin Fridell

In 2012, the Conservatives ended the 70-year monopoly seller status of the Canadian Wheat Board, one of the world’s largest and most successful “state trading enterprises.” The government decision came without a vote among prairie grain farmers, required by the Canadian Wheat Board Act, and despite a 2011 plebiscite in which a majority of farmers voted to maintain the Board’s status. The matter is now before the courts, but the Board cannot simply be revived after having been dismantled. Instead, a coalition of farmer groups has launched a class action suit against the government seeking billions of dollars in compensation.

Despite giving hundreds of millions of dollars each year in subsidies to tar sands companies, to cite just one example, the Conservative government fashions itself as libertarian, opposed to state intervention, and has long virulently opposed the Board, favouring the interests of giant agribusiness and anti-Board grain farmers. The future of the Board has long been tenuous in the face of declining numbers of smaller farms, the rise of ever-larger ones, and the global expansion of giant transnational corporations that dominate the world’s food system. It is estimated that between 70 and 90 per cent of the entire global grain trade is controlled by just four corporations: the “ABCD group,” composed of ADM, Bunge, Cargill, and (Louis) Dreyfus. These giant grain traders have been rubbing their hands in anticipation of seizing control of the multi-billion dollar market once managed by the Board.

Against these odds, the persistence and long history of the Board is all that more remarkable. In the first half of the twentieth century, poor prairie farmers mobilized against powerful corporate rail, banking, and elevator monopolies, driving a tide of radical agrarian reform that, amidst the chaos and uncertainty of the Great Depression and the Second World War, led to the decision by the federal government in 1943 to authorize the Canadian Wheat Board to act as the “single-desk seller” for all Western Canadian wheat, durum, and barley sold internationally and for human consumption domestically. Although originally envisioned as a temporary measure, the Board proved to be highly successful and popular, and was continually renewed and expanded over the next several decades, frequently receiving support from all major federal parties. During this time, Canada emerged as a leader in the international grain trade and today accounts for around 14 per cent of the world’s wheat.

The Board’s main activities centered on collectively managing prairie wheat, resulting in higher and steadier prices due to price pooling, stringent quality controls, and the ability of the Board to use its immense weight to offer coveted large contracts to major wheat importing nations for an additional price premium. The Board also offered farmers indirect benefits, promoting new innovations and acting as a representative of farmers in disputes with powerful corporate interests. For example, the Board played a central role in blocking the introduction of Monsanto GM modified wheat in 2004, and in recent years initiated an organic program that has made Canada one of the world’s top growers of organic grain.

Throughout its history, the Board has brought countless gains to prairie farmers and served as a model example of effective collective marketing in action, defending the livelihoods of smaller grain farmers against the relentless tide of “free trade” rhetoric, which frames corporate monopolies as “market freedom.” This is no small feat in a world where libertarian fantasies so often rule the day (in rhetoric, not in practice as the recent trillion dollar Wall Street bailout so powerfully reveals). Against the preponderance of a political culture that celebrates individualism and selfishness, the moral force and cooperative ethos of the Wheat Board will be  missed.

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Gavin Fridell is a Canada Research Chair at Saint Mary’s University and author of the forthcoming book, Alternative Trade (2013), which features a chapter on the Wheat Board.

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