The Gretzky of the Marketing World
(February 3, 2004 - FFJ) Elected director and chairman
of the CWB, Ken Ritter, suggests his CWB is the Wayne Gretzky of the wheat
and barley marketing.
On December 15, 2003 the CWB issued a press release to detail the fact
there was an $85,000,000 deficit in the wheat pool account and
consequently no final payment.
The only real surprise is that the deficit isn't a lot bigger!
Wheat prices peaked in October 2002 at over $8.20 per bushel. The
CWB had already been out of the market since early August,, reportedly
costing producers $500,000,000.
The CWB was not only out of the market, but according to their
backgrounder to the December 15 press release, they were forced to
"buy back" wheat which they had wholesaled at fire sale prices
prior to August 1, 2002.
Why would CWB "DUMP" wheat in the face of a pending drought
and extremely tight wheat stocks??
Net Interest Earnings
The CWB generates income by lending money at high interest rates to poor
countries with no credit rating. If these countries make their
interest payments, the spread is put into the "Net Interest Earning
Account". If they default on their principal payments, the CWB
sends the bill to the federal government to add to the $7,000,000,000
already owed & payable by the taxpayer.
There is a reported $54,000,000 Net Interest Earnings, but what
percentage of this was used to also bring down the wheat pool deficit?
Initial prices were raised to unrealistic levels just prior to the fall
of 2002 CWB District Elections and at a point in time when over-all wheat
prices were falling.
Apparently the CWB didn't hedge any rise in the Canadian dollar.
How much did this cost producers and are they hedging in 2003-2004?
Did you know the CWB bought $128,000.00 car for a Beijing sales
consultant?
All these mistakes and millions in losses -- and not one person
dismissed.
How would Ed Zinger's Bank of Montreal or Bonnie Dupont's Enbridge deal
with losses of this magnitude?
If Reg Alcock cannot implement voluntary choice marketing in Western
Canada, at least he should insist on a new marketing team and a new CEO.
Farmers bent on maintaining the CWB monopoly should be prepared to pay
for it's mistakes.
Reg Alcock should invoice the farmers who benefited from the
$85,000,000 deficit! After all - the taxpayer is already on the hook
for over $7,000,000,000.
The CWB have been marketing grain for over 60 years, they continue to
get worse! Montana cash prices are presently $1.00 per bushel higher
than the most optimistic PRO (Producer Return Outlook).
The CWB has $4,500,000,000 a year at their disposal -- no consequences,
no accountability, no vested interest, and no mandate to maximize profits
for the producer. In 20 years the CWB has created enough debt to
absorb two complete crops. Where does it stop?
This is certainly not a Wayne Gretzky - it's more like an Air Canada:
bankrupt, and its executives siphoning off millions!
Accumulated Debt -- $7,000,000,000
Deficit -- $85,000,000
Net Interest Earnings -- $54,000,000
Car for Beijing Sale Consultant -- $128,000
Where does it stop!
~Ron Duffy
Farmers for Justice |
