The 2004-05 crop year will go down in Canadian Wheat Board (CWB) history as one that presented a host of challenges both for farmers and its marketing agency, the CWB said today at its annual end-of-crop year news conference.

CEO Adrian Measner described the marketing year as among the toughest he had ever experienced.

"This was one of the most challenging marketing years in my three decades at the CWB," Measner said at the CWB's annual crop year-end news conference. "The low overall grade of the crop, combined with the larger volumes we dealt with, presented difficulties on a scale we have only faced once or twice before."

The CWB exported just over 15 million tonnes of wheat and barley, despite a late summer frost that resulted in large supplies of lower-grade grain.

Measner said the CWB's ability to move a large volume of such low-grade grain speaks to the diversity of its customer base and its ability to adapt to changing circumstances. Just 30 per cent of Canada Western Red Spring wheat fell into the top two grades, compared to at least 65 per cent in an average growing season. Exports fell a million tonnes short of the CWB's initial forecast, reflecting lower deliveries of feed-grade grain than initially forecast.

"We had late seeding, a cold summer, a killing frost in August and then a really wet harvest," said Ken Ritter, chair of the CWB's farmer-controlled board of directors and a Kindersley-area farmer. "This was especially disappointing since volumes had finally rebounded from two years of drought across the Prairies."

The CWB took innovative measures to capture as much value from the crop as possible. This included the use of a No. 4 milling wheat grade, marketing some feed wheat for flour milling, providing falling number guarantees to end-use customers and tendering for specific quality traits.

Major customers for Canadian wheat included domestic Canadian consumption, China, Japan and South Korea. Major malting barley consumers were the domestic market, China, the U.S., Colombia and South Africa.

"We were able to manage through a difficult year and we were able to protect our valuable relationships with our traditional high-value customers," Measner said, adding some extraordinary measures were taken to juggle limited high-quality supplies to suit the requirements of key customers.

The CWB also took the extraordinary step of returning hedging gains to farmers unable to fulfill Producer Payment Option contracts. In addition, a retroactive Early Payment Option was created to increase farm cash flow.

"The CWB has demonstrated its commitment to serve farmers very clearly this crop year," Ritter said.

Weather conditions have continued to challenge Prairie farmers into the new 2005-06 crop year. The situation has been especially serious in the eastern Prairies, where millions of acres are unseeded or waterlogged. However, good growing conditions throughout much of the rest of the Prairies have above-average yields expected.

The CWB's Weather and Crop Surveillance department is projecting a western Canadian wheat and barley crop of 35 million tonnes, just slightly below last year's volume. The CWB expects an export program of 17 to 18 million tonnes for the 2005-06 crop year.

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.