Farm groups fear agri-business wins if CWB goes

by 5m Editor
8 January 2007, at 11:47am

CANADA - Alberta's beef producers already know what happens when multinational food giants dominate the market. Now, with the future of the Canadian Wheat Board in doubt, there are fears of diminished profits if U.S. grain buyers are left to do the same thing.

"If the federal government is able to kill the only real Canadian, farmer-owned marketing arm, which is the wheat board, then we would be faced with the same situation that the beef producers are now," says Stewart Wells, president of the National Farmers Union.

Canada's beef packing industry is dominated by two huge U.S.-based companies, Cargill and Tyson Foods, both with slaughterhouses in southern Alberta. Cargill also has one of the largest cattle herds in the country.

This allows the company to buy from itself to guarantee a steady supply of beef. Farm groups and producers say this tactic gives Cargill an advantage over ranchers trying to get the best price for their cattle.

In 2004, several farm groups pushed unsuccessfully for a law to forbid major meat packers from owning cattle to prevent them from using their own herds to manipulate prices.

The slaughterhouses argued that they need to own some cattle to ensure they have animals to fill their kill lines when ranchers choose not to sell to them.

Alberta Agriculture Minister George Groeneveld dismisses the possibility of this scenario happening in the grain market.

Source: Canadian Press

5m Editor