Secrecy on sale of CWB raises concerns

Farm groups sense that the CWB privatization process is underway and are miffed they are being kept out of the loop.


“We see this process starting without anybody being told about it, so that’s kind of concerning,” said Keystone Agricultural Producers president Doug Chorney.


“There’s obviously a deliberate attempt here to not share what’s going on.”


CWB has until July 31, 2016, to submit a commercialization plan to the federal government, but it has said it intends to accelerate that timeline. 


CWB was contacted for this story but declined comment.


The biggest clue that something is afoot is that Farmers of North America is suddenly, in the midst of harvest, scrambling to gauge farmer interest in taking a majority interest in the grain company.


It has organized a series of town hall meetings across the Prairies starting Sept. 29 to inform farmers about its take-over plans.


FNA’s website is filled with phrases such as “we must act now” and “acting now is urgent.” The group said a confidentiality agreement prevents it from disclosing why it is in such a rush to put together its bid for CWB.


Chorney said it is clear that the ball is rolling on privatization and is perplexed by all the secrecy surrounding what’s happening.


“What is the process that is underway here and why are producers not being kept in the loop?” he said.


Stewart Wells, chair of Friends of the Canadian Wheat Board and a former director of the CWB, always suspected the government would fast track the process.


He said when he reads between the lines of the FNA proposal, it appears that the government isn’t looking to recoup taxpayer dollars through the sale of CWB.


FNA says it wants to gain control of the CWB, but the money it raises from farmer members would be used to buy additional assets rather than existing ones.


“Nowhere do they say they’re actually going to be buying something,” Wells said.


“It looks like FNA thinks the government will be giving those assets away, and FNA seems to be putting a value of $270 million on those assets.”


Wells said there is a lot of taxpayer money invested in the company, at least $177 million, according to the 2011-12 annual report.


Friends of the CWB has placed a higher value on the assets and good will of the former single-desk marketing agency.


It is helping four farmers launch a class action lawsuit against the federal government to recover what it estimates is $17 billion worth of value that disappeared when the export monopoly was eliminated.


The Federal Court of Appeal will hear their case Oct. 15 in what the group hopes will be the first step in getting the class action suit back on track after Federal Court judge Daniele Tremblay-Lamer rejected most of the group’s arguments for launching a suit.


Meanwhile, farm leaders continue to pay close attention to the privatization of CWB.


Ron Bonnett, president of the Canadian Federation of Agriculture, recently raised the issue in a meeting with the deputy and assistant deputy ministers of agriculture.


“A lot of people are hearing some of the same things, that things have been fast-tracked. That’s part of the reason we wanted to bring it up,” he said.


“We know there is likely to be a lot of questions from farmers about the sale when and if it takes place.”


Bonnett was told CWB has yet to submit its privatization plan to Ottawa.


One of the questions he had for the senior Agriculture Canada officials was who will get the proceeds of the sale.


“They did mention that it will not go to government,” he said.


Bonnett said there are still outstanding issues about whether farmers have an equity stake in CWB’s assets.


“They don’t feel there is a farmer equity position in it, and I think that’s something that we definitely need to have more discussions about,” he said.


For the CFA, a lot will depend on how a privatization deal is structured. Is it going to be a buyout or a partnership? He said the CFA would like the CWB to remain a competitor to the main grain companies.


“That would be our preference is they would remain an independent buyer in the marketplace because if it is just swallowed up, then all of a sudden you don’t have that competition we’re looking for.”

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