The CWB said today it will seek major financial compensation from the Canadian government for western Canadian farmers if government guarantees of initial payments and borrowings are eliminated as part of the next World Trade Organization (WTO) deal.

"These guarantees have real value. If we, as farmers, are forced to relinquish the benefits of them, then we expect full compensation in return," said Ken Ritter, chair of the CWB's farmer-controlled board of directors.

On Saturday, the Canadian government approved a WTO framework agreement that targets the government guarantees and, for the first time, puts the CWB's single desk on the table for future negotiations. Article 18 of the framework agreement calls for the elimination of 'trade distorting practices with respect to exporting STEs including eliminating export subsidies provided to or by them, government financing, and the underwriting of losses. The issue of the future use of monopoly powers will be subject to further negotiation.'

Ritter said he expects many farmers are feeling betrayed by the initial agreement. "The Canadian government had previously committed that it would not relinquish the guarantees without knowing that Canada was getting something in return, and that the single desk would not be on the table. Sadly, this framework hits both. If this agreement gets implemented, then Western Canadian farmers will be asked to give up the guarantees that they have through the CWB with very little in return, it appears. And, despite explicit promises to the contrary, the government even appears prepared to negotiate on the very structure of the CWB."

Ritter said the language the government agreed to reflects the position of the other major wheat producing nations – the U.S., the European Union and Australia – which sought disciplines that would erode the CWB's value to western Canadian farmers. Ritter pegged that value at hundreds of millions of dollars each year.

While it could take up to 10 years before any final deal is implemented, Ritter said Canada needs to ensure farmers' right to choose their system of marketing is protected.

"Putting the single desk on the table for future negotiations makes no sense at all given the complete absence of proof that the single desk distorts trade in any way," Ritter said. He referred to the February 2004 decision by the WTO dispute settlement panel that exonerated the CWB from U.S. claims that the CWB used its single desk to engage in unfair trade practices.

Ritter said the CWB looks forward to the in-depth discussions the government has promised to have with the CWB prior to the resumption of the WTO negotiations in order to coordinate Canada's approach.

Controlled by western Canadian farmers, the CWB is the largest wheat and barley marketer in the world. As one of Canada's biggest exporters, the Winnipeg-based organization sells grain to more than 70 countries and returns all sales revenue, less marketing costs, to Prairie farmers.