Changes have been put in place for the Canadian Wheat Board and they are going to affect all wheat growers and some of the barley growers in western Canada. The changes come into play on August 1. 2012. The biggest change will be that the Canadian Wheat will not be the only one that you can sell wheat, malt barley or export barley to. A grower will have options when it comes to selling these crops. Prairie farmers are now getting to see what the sales options are. Various companies, including the Canadian Wheat Board, are out selling their services to wheat and barley growers across western Canada. Contracts are now being offered for the 2012 crop. Each grower will have to look at the contracts and decide if they fit for them. There are a few things that must be looked at when signing these contracts. Being familiar where there might be issues with this new system is critical. To be able to market new crop, it may be important to have a signed contract. This is especially true for malt barley contracts. Companies will go out and sell malt barley on the basis of the contracts that they have signed. Quality must be in place in the fall for the sale to happen, but companies will look to the growers that they have signed contracts with to deliver first. Coming in later will likely mean limited sales opportunities. Look at the crop that you are growing and the relationship that you have with your grain buyer and decide if a signed contract is worthwhile for you. The number one concern for growers in our area is going to be how the contracts handle lower quality grains. Living in the northern prairies means that we can have quality or quantity issues related to the weather. Frost, excessive moisture and drought are all issues that can cause issues in grain production. In the northern prairies, we can see any of these issues turning into a concern with a crops that we grow. Any contract that is signed must deal with these issues or give a producer an opportunity to look for other solutions. The company that sells your milling wheat may not be the best one to sell your feed wheat. An “Act of God” clause is something that will allow producers and companies to deal with substantial changes in grade or quantity of grain. Not all contracts contain this but it is worth looking for. What the clause does is gives the grain company and the producer an opportunity to break the contract without penalty to allow the best decision to be make for both parties with the lower quality grain. There are going to be many new opportunities to market your wheat and barley. Some will be similar to what grain producers have seen in the past and some will be significantly different. Most growers have experience selling canola or oat on the open market, so this is not totally new. Look for opportunity, but be aware of the risk.
By Dave Cubbon, P Ag