The recently confirmed merger between Bunge and Viterra is a reminder of how times and attitudes have changed. The merger could be contingent on divestitures required by the competition bureau, but the idea of the two heavyweights joining forces isn’t creating much of a stir.
I started as a wet-behind-the-ears agriculture reporter back in 1980 when the Saskatchewan Wheat Pool was king. Not only was this farmer cooperative the dominant grain handler in Canada, but it was also the most influential policy voice for farmers.
The NDP was the prevailing government of Saskatchewan with strong support in both urban and rural. Sask Pool, while officially non-partisan, could practically write NDP Ag policy.
The Western Producer was owned by Sask Pool and while the reporting was strong and quite objective, the editorial policy never deviated much from that of the owner. When the president of Sask Pool got up to address the annual meeting, you could be sure that would be on the front page of the newspaper.
Sask Pool had wide-ranging business interests which probably contributed to its undoing. It you’re old enough you might remember its ownership stake in Robin’s Donuts or its ill-fated grain terminal developments in other countries.
Back then, the Canadian Wheat Board was sacrosanct and so was the Crow Rate that guaranteed a fixed freight rate for moving grain to export position. The Crow ended with payment to cash-starved farmers to help blunt criticism. The CWB tried to re-invent itself, but was eventually terminated to satisfy a wave a farmer opposition to central desk marketing.
Today, it’s hard to imagine strong NDP support among Saskatchewan farmers. It’s hard to imagine farmers putting up with being told when and how much wheat they could deliver to the elevator. That seems like an eon ago.
To the west, Alberta Wheat Pool was strong and to the east Manitoba Pool Elevators rounded out the Prairie Pool juggernaut. The other force, with a somewhat more right-wing philosophy was United Grain Growers which operated in all three provinces and also boasted farmer ownership.
According to the accounts from the early days, farmer owned elevator companies grew from the discontent of producers being mistreated at the hands of private firms. The distrust lasted for generations, but has faded with the changing times.
A large chart is needed to detail the array of mergers and acquisitions which have occurred in recent decades. Names like Agricore United are relegated to the history books and it seems that Viterra may also become a historical footnote.
Some family-owned grain companies have survived and thrived amidst all the turmoil. Richardson Pioneer is a major player in the Canadian grain industry. Both Paterson Grain and Parrish & Heimbecker are well respected and have some strong assets. There are also a handful of smaller grain companies with significant farmer ownership.
The assets of the Canadian Wheat Board are now in the hands of G3 with Bunge a major shareholder in the company. With a system of loop track elevators and a major new export terminal on the West Coast, the company is providing more competition in the grain handling business. GrainsConnect is a recent entrant.
At one time, farmers thought they needed their own grain companies to save them from shark infested waters and those farmer-owned companies dominated for many decades. Now, farmers have more choices than ever and competition for their business has never been healthier.