In 1935 the Canadian Wheat Board (CWB)
was established as an exclusive crown agency to export wheat. Today, the
Canadian Wheat Board:
- markets prairie grown wheat and barley
for international export or domestic human consumption across
provincial borders or for Canadian livestock consumption;
- maintains the quota system and producer
identification network;
- coordinates rail movement of grain;
and,
- pools sales and returns all profits
back to producers.
About 85% of the wheat and about 45%
of the barley grown in western Canada is marketed through the
Canadian Wheat Board. The Canadian Wheat Board buys the producers'
wheat or barley and sells it to international or domestic clients.
Because wheat and barley are sold through the Wheat Board, they
are referred to as board grains. Other types of grain such as
canola, flaxseed, oats and rye are called nonboard grains.
In order to ensure the right grains
and grades of grains are brought into the elevator system to meet
customer requirements and to provide equal opportunity for all
farmers to sell their grain, the Canadian Wheat Board sets delivery
quotas. Farmers deliver their grain to local elevators and terminals
according to these quotas.
Canadian grain producers who wish to
sell through the Canadian Wheat Board are required to have a Delivery
Permit Book and a Producer Identity Number. In this book each
producer lists the number of cultivated acres and kinds of crops
that will be seeded that year. The Canadian Wheat Board gathers
this information to find out how best to establish quotas for
each crop. The quota system gives all producers relatively equal
opportunity to sell their Wheat Board grains.
A quota period is a set time when certain
quantities of specific grains can be delivered to the local elevator.
There may be up to a dozen quota periods in a year, depending
on grain sales. During each quota period farmers are allowed to
sell a certain number of bushels of a specific grain.
Grain producers selling through the
Canadian Wheat Board receive an initial payment for their grain
when it is delivered to the elevator. This part payment is established
by the federal government prior to the start of the crop year.
The crop year runs from August 1st of one year to July 31st of
the next year.
The Canadian Wheat Board also coordinates
the rail movement of grain from country points to port terminals
for storage and export.
The Wheat Board sells the grain during
the crop year, accumulating revenue. The price the wheat and barley
is sold at depends on what is happening in the major wheat and
barley importing and exporting countries of the world. Some factors
affecting the price of wheat and barley are:
- economic situation in these countries;
- grain production in importing and exporting
countries;
- agricultural policies of foreign and
Canadian governments;
- grain stocks remaining from previous
years (world supply); and,
- export subsidies.
At the end of the crop year, the Canadian
Wheat Board deducts its expenses and sends producers a final payment.
If the price received from customers during the year is less than
the initial payment, the federal government absorbs the loss.
Adjustment payments may be made if prices increase significantly
over initial payments levels.
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