Sask Wheat submits response to the Canada Grain Act Review
Saskatoon (April 26, 2021) - The Saskatchewan Wheat Development Commission (Sask Wheat) has made its submission on behalf of Saskatchewan’s wheat producers to the review of the Canada Grain Act (CGA) and operations of the Canadian Grain Commission (CGC). CLICK HERE to read the submission.
“Sask Wheat welcomes the opportunity to provide feedback on a critical act that directly impacts Saskatchewan’s wheat farmers,” said Sask Wheat Chair Brett Halstead. “It is vital that the review leads to a strengthening of Canada’s quality assurance system so it benefits the viability of profitably growing wheat in Canada. Maintaining the reputation of the Canadian brand and increasing the transparency of market information will allow Canada’s wheat farmers to seize opportunities in an increasingly competitive global marketplace.”
In preparation for the CGA review, Sask Wheat commissioned two reports to guide producers through the key topics being reviewed. The first report was a guide to potential changes to the CGA and their implications for Saskatchewan grain producers’ activities and economics. The second report is a comprehensive overview of data gaps and the lack of transparency in grain markets and the solutions required to put producers on an equal footing when planning their cropping decisions and marketing their crops. Both reports are available on the Sask Wheat website and producers are encouraged to review them before making their own submissions to the review.
The key recommendations of Sask Wheat’s submission include:
· CGC Mandate and Governance - Sask Wheat believes it is vital that the CGC’s mandate continues to work “in the interests of the grain producers.” Sask Wheat is supportive of the current Commissioner governance model of the CGC with producer representation at the Commissioner level.
· Outward Inspection - As part of protecting the Canadian brand, Sask Wheat is in favour of mandatory outward inspection remaining as a function performed by the CGC. Moving to a system of accredited third-party inspection would create significant risks to the Canadian brand.
· Market Transparency - Improving market transparency is a key issue for farmers. Sask Wheat strongly believes that Canadian farmers need timely access to sales and export data. Through the CGA, grain companies should be legislated to report daily and weekly sales data over a specified size to the CGC.
Sask Wheat is supportive of reviewing the CGA as a comprehensive review of the Act has not been completed in 50 years. However, it is crucial for a thorough analysis to be completed, including a benefit-cost analysis, as part of the review and for further consultations to occur once this review is completed and prior to recommendations being brought forward for consideration. Further analysis by Agriculture and Agri-Food Canada and the CGC will ensure any proposed changes that arise from the review do not harm Canada’s quality assurance system, the Canadian brand, or the competitive position of Canadian farmers.
The Sask Wheat positions on the key areas of review are summarized in the attached backgrounder. Producers are encouraged to add their submissions to the review, which is closing on April 30.
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To schedule interviews, please contact:
Dallas Carpenter
Communications Manager
Saskatchewan Wheat Development Commission
306-653-7967
BACKGROUNDER – Sask Wheat Submission to the CGA Review
CGC Mandate and Governance
Sask Wheat believes it is vital that the CGC’s mandate continues to be to work “in the interests of the grain producers,” and that the CGA and Canada Grain Regulations are applied according to this mandate, and that the functions, activities, and initiatives of the CGC reflect this mandate at all times. Sask Wheat is supportive of the current Commissioner governance model of the CGC with producer representation at the Commissioner level.
Outward Inspection
As part of protecting the Canadian brand, Sask Wheat is in favour of mandatory outward inspection remaining as a function performed by the CGC. Moving to a system of accredited third-party inspection would create significant risks to the Canadian brand. The main risk is that customers would perceive it as a deterioration of the Canadian quality assurance system which would hurt Canada’s competitive position. Any such deterioration or perceived deterioration to Canada’s quality assurance system and the Canadian brand would ultimately hurt Prairie grain producers the most.
CGC Surplus
Sask Wheat believes that any determined uses of the accumulated surplus need to go towards activities that will directly benefit farmers as they are the primary source of CGC fee recovery, despite licensees collecting and remitting fees to the CGC. Furthermore, Sask Wheat is supportive of the CGC’s Surplus Investment Framework announced in 2018 and the enhancements made to the Harvest Sample Program with the addition of DON and falling number analysis for wheat samples. Sask Wheat also believes that the forecasting methodology used by the CGC to determine user fees should be adjusted to reflect increases in production, export, and official inspection/weighing volumes which would serve as a more accurate model and prevent the surplus from continuing to grow.
Market Transparency
Improving market transparency is a key issue for farmers. Sask Wheat strongly believes that Canadian farmers need timely access to sales and export data, and that the CGC is best suited to collect and disseminate this data as it is a neutral party which is already privy to much of the information needed. Through the CGA, grain companies should be legislated to report daily and weekly sales over a specified size to the CGC. The CGC could then make this data available on its website like what is already done for the other data series the CGC collects and reports.
Licensing
The CGC’s licensing system is valuable to farmers to provide producer protection services and to manage the quality assurance system. To ensure farmers have access and coverage under the CGC’s producer protection services, Sask Wheat is requesting that licensing requirements be extended to include feed mills and container-loading facilities.
Subject to Inspector’s Grade and Dockage (STIGD)
STIGD is an important tool for farmers to have in negotiations with grain companies. However, Sask Wheat would like to see several changes made to enhance the usefulness of the program, including having the CGC define a specific window for how long a grain company must hold onto a farmer’s grain sample that will allow farmers to challenge an elevator’s grade after delivery within that window. Adding non-grade determinants, such as DON and Falling Number (FN), to the STIGD process would also strengthen this tool for farmers. Sask Wheat also urges the CGC to expand access to STIGD to all licensed facilities.
Producer Payment Protection
Sask Wheat believes it is crucial to maintain a security system that reflects an individual company’s risk profile and activities to keep the system accountable.
CGC Oversight on Objective Measurements
Oversight on objective grading measurements, such as moisture and protein, has always been a concern for farmers. Sask Wheat encourages the CGC to use a portion of its surplus to increase the capacity to conduct onsite inspections and auditing of grading practices and equipment at primary elevators through a random auditing program. Sask Wheat also recommends the CGC explicitly define and explain the scope of its authority and consider exercising such authority that it has regarding oversight on equipment and testing protocols for non-grading factors, such as DON and FN, which have become increasingly important in grain contracts.
Grain Research Lab
The crop and technology research completed by the GRL plays an important role in maintaining Canada’s quality assurance system and supporting the Canadian brand. Sask Wheat strongly encourages the Federal Government to review the appropriation funding levels for the CGC and GRL to ensure they accurately reflect the benefit to the public.
Western Grain Standards Committee
The Western Standards Committee performs important functions contributing to the support of Canada’s quality assurance system and the Canadian brand within the parameters set out for it in the Canada Grain Act, especially “recommending specifications for grades of grain and selecting and recommending primary standard samples and export standard samples of grain” Sask Wheat supports adjusting the membership of the Western Standards Committee so that “actual producers of western grain” constitute a clear majority of the Committee. To ensure a producer majority and, further, to ensure that majority when producer vacancies, through no fault of producers, occur in the Committee membership from time to time, mandating a 60% majority of producers in the total membership of the Committee (15 out of 25) seems appropriate.