US Grain Firms in Canada
Publisher: The Elements: A Journal of World Resources, Washington, DC, Canada
Periodical profile published 1976
Year Published: 1976
Pages: 12pp Price: $5.00/yr
Resource Type: Serial Publication (Periodical)
Cx Number: CX192
A discussion of the movement of Cargill & Continental Grain Inc. into Canada.
This issue of "The Elements" discusses the movement of Cargill and Continental Grain Inc. into Canada. The Canadian Wheat Board has maintained a storage and marketing network that has "worked to the advantage of both farmers and consumers, while also allowing for the worlds most generous program of aid to hungry nations." When the grain is delivered to the elevator, the farmer receives an initial payment. If the wheat is later sold for a better price, the excess money is placed in a pool and eventually is returned to the farmers. The Board's control has been declining for the past fifteen years due to a federal directive to sell some of the grain on the open market. The effect is that the CWB can no longer stabilize price and supply. Cargill Corporation and Continental Grain Inc. are now purchasing wheat from CWB. They now handle less than 10% of Canadian- produced grain but are expected to purchase more when the prices are forced down in August. Their entry into the Canadian grain market "poses a serious threat to the country's entire grain pricing and supply system." The National Farmers Union (NFU) of Canada fears that they eventually may be able to control prices of all Canadian grain as well as their movement onto the world market. The NFU of Canada fears they will bring a more centralized marketing system with more transportation costs to the farmer. The suggested closing down of some rail lines gives credence to their fears. "Some observers are pessimistic about how much influence the Farmers Union can bring to federal policy in the important grain and transportation decisions which Canada will be making."