The Western Canadian Wheat Growers Association is seeking a review of the services provided by the Canadian Grain Commission (CGC) before it moves to increase any of its user fees. The CGC is proposing to more than double the user fees it charges. Increases in user fees without any change in the services provided will result in lower grain prices to farmers.
“We are concerned the Grain Commission is putting the cart before the horse,” says Kevin Bender, President of the Wheat Growers. “Before any fee increases occur, we first need to determine which services are still needed and whether some services might be better handled by the private sector.”
In its submission to the CGC, the Wheat Growers recommend that several CGC services that are now mandatory be made optional. For example, the Wheat Growers recommend that CGC grading no longer be mandatory when grain is unloaded at port terminals.
The Wheat Growers also recommend that CGC grading of grain be made optional on all export shipments. We note that official CGC grading is no longer required on shipments to the United States, nor is it required on shipments to domestic users including flour mills, malt plants and oilseed crushing facilities.
“Moving to an optional grading basis will ensure that official CGC grading only occurs when the value exceeds the cost,” says Kevin Bender. “The Wheat Growers believe buyers and sellers are in the best position to determine whether any particular CGC service adds value to their grain shipments.”
The Wheat Growers have also recommended that any proposed fee increases take into account he need for fees to be competitive with fees charged by inspection agencies in other countries.
“This consultation exercise points to the need to modernize the Canada Grain Act,” says Bender. “Going forward, we need to make sure the Commission continues to provide services that are of value to farmers and other players in the industry.”
