Canada: CWB loses export barley monopoly

Regulations governing the Canadian Wheat Board (CWB) have been amended to allow western Canadian farmers to bypass the marketing board when selling export feed and malting barley at the start of the 2007-08 marketing year, SNS reported June 11.

The amendments to the Canadian Wheat Board Regulations will be published in the Canada Gazette Part II on June 27, 2007. They remove barley and barley products from the CWB's single-desk authority and permit farmers to sell their barley to any domestic or foreign buyer, including the CWB.

The CWB will continue to pool barley and Canada's government will continue to guarantee the initial payments to producers for those who want to continue to sell through the CWB.

A group of a dozen western Canadian farmers have launched a legal challenge to Ottawa's plan to end the Canadian Wheat Board's monopoly on barley sales, in a case that will probably last four to five months, their lawyer said, according to Reuters, June 11.

The farmers, part of a group called Friends of the Canadian Wheat Board, will argue in Federal Court that Agriculture Minister Chuck Strahl did not have the power to end the monopoly by regulation, their lawyer said.

"That's a fundamental flaw, and it's so basic," said Anders Bruun, a lawyer with Winnipeg-based Campbell, Marr LLP.

To end the monopoly on barley sales from Western Canada, the minority Conservative government needed to change the CWB's governing legislation, which would require a vote by Parliament, Bruun said.

The farm group is being supported in part by C$20,000 ($18,900) from the Manitoba government, a spokesman for provincial Agriculture Minister Rosann Wowchuk confirmed.

The Saskatchewan government is also looking at how to support the group, Agriculture Minister Mark Wartman said in an interview.

"We're also very clearly investigating whether we do parallel legal action, whether we take action separately, whether we join," Wartman said, adding he expects to make an announcement in coming days.

Saskatchewan farmers provide about 70 percent of the malting barley sold by the CWB, Wartman said, and stand to lose as much as C$40 million in premiums under the open market.

The CWB has not determined whether it will launch its own legal action on the issue, Chairman Ken Ritter said on Monday.

The Friends of the CWB group is concerned that farmers will lose marketing power to large, private grain handlers with the change.

Bruun was general counsel for Manitoba Pool Elevators in 1993 and was part of a successful challenge that overturned an attempt by a previous Conservative government to open up barley marketing.

"We may very well see something similar to that unfold here," Bruun said.

The case will likely cost C$30,000 to $40,000, and Bruun said the group has raised enough money from farm organizations, individuals and the Manitoba government to cover legal costs.

The Canadian Wheat Board has not provided any financial support to the case, and is not involved, Bruun said.

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