WESTERN PRODUCER — This is the first story in a three-part series looking at the Canada Grain Act review process. The next story will look at potential changes to Canadian Grain Commission programs and services.
A federal initiative to update the Canada Grain Act remains on track but timelines for its completion are unclear, government officials confirmed last week.
The CGA has been in place since 1912 and serves as the foundation of Canada’s quality assurance system for grain.
Among other things, it authorizes the Canadian Grain Commission to enforce regulations and provide services that touch on almost every aspect of the grain trade, from establishing grain-grading procedures, to resolving grading disputes and inspecting outbound grain exports.
The Liberal government launched a review of the act in January 2021 to ensure that it — as well the operations of the CGC — are serving the interests of Canadian grain producers and supporting a strong grain supply chain.
The act hasn’t been subject to a thorough review in more than 50 years.
Agriculture Canada, which is leading the legislative review, declined to be interviewed but said in a Jan. 21 email that officials “continue to analyze stakeholder feedback and develop recommendations for next steps in the modernization process ….”
Doug Chorney, chief commissioner at the CGC, said reviewing the Canada Grain Act is important.
Changes that are made, both regulatory and legislative, will benefit producers and other supply chain partners.
“I think it’s important because we’ve had a lot of things that have changed in the grain industry,” Chorney said.
“The nature of grain deliveries by farmers has changed dramatically … and the high throughput of grain to port, for export, has also changed so I think that is going to reflect the way the CGA could be crafted.”
The expansion of domestic processing capacity is an example of why the act needs to be updated, Chorney added.
Currently, process elevators, including canola crushers, are not covered by the act.
That means programs such as the CGC’s Subject to Inspectors Grade and Dockage dispute resolution service are not available to farmers who sell grain to processors.
“We just had a call this week from producers in Alberta asking if (the act) could include process elevators in the future,” Chorney said.
“We see more processing in the Prairies than ever….
“We want to facilitate that kind of investment but we also want to make sure that the act reflects this change … and is there to protect producers.”
The CGA review process is entering its second year.
In early 2021, stakeholders were invited to submit views on how the act and the operations of CGC could be improved. A total of 66 submissions were received from farmers and other stakeholders.
Feedback is summarized in a document entitled “What We Heard: Canada Grain Act Review Consultation,” available online here.
According to the document, key issues fell into three general themes or categories: CGC administration, grain grading and oversight, and producer safeguards.
Topics under CGC administration included the effectiveness of the CGC’s governance model, CGC funding, and the commission’s mandate.
Under the CGC’s current governance structure, the federal government appoints three commissioners, including a chief commissioner.
Historically, most commissioner appointees have been farmers, an arrangement that supports the act’s original intent, which is to protect the interests of farmers and ensure their fair treatment.
However, during the 2021 consultation, many respondents said the CGC’s governance model should be changed to ensure the interests of grain handling companies and processors are more adequately represented.
Some respondents suggested one of the appointed commissioners’ positions should be filled by a representative of grain-handling industry.
Others said the CGC should be governed by a board that ensures industry-wide representation.
Grain commission funding was another key issue.
Under the former Conservative government, Canada took steps to reduce federal financial support for CGC operations.
As a result, CGC service fees — covered by grain companies and producers — currently cover about 90 percent of the CGC’s annual operating budget.
Many stakeholders would like to see a greater share of the CGC’s budget covered by federal appropriations.
Producer deductions at the point of delivery could be another potential funding source, some suggested.
For Saskatchewan grain producer Cam Goff, a fundamental question is whether the CGC’s mandate should be broadened to support the interests of grain companies as well as producers.
Although he’s not opposed to updating the CGA or reviewing CGC operations, he fears that diluting the mandate of the CGC could have a far-reaching impact.
“It could be very detrimental for farmers … but I’m hopeful that it won’t,” said Goff.
“Overall, I’d have to say I’m hopeful that (government) will listen to what farmers are saying….
“After all, farmers provide the wealth that supports the entire grain trade.”
