WCWGA against SWP-AU Merger

[Jman]

I heard Cherlyn Jolly Nagel on the radio yesterday saying the WCWGA doesnt support the SWP-AU Merger because it will decrease competition?

What planet is she from? Did she jump ship to the NFU or NDP?

This is a terrific opportunity for SWP to eliminate one head office in Canada, saving us Designated Area farmers approx $50-65 million per year in head office administration costs alone. Not to mention the cost to further rationalize the over-built concrete elevator network. Most of these 16-20,000 tonne elevators are too small (they are 200,000 tonnes in Kanas) and lose money every year. If they bull-doze half of those facilities, imagaine the cost savings on staffing, administration, depreciation and municipal taxes,that can be passed on to us in terms of better basis levels?

I havent seen her for a year or so, boy has she changed, who is FEEDING her this leftie information?

[craig]

Jman you say it's going to save us farmers all that money. Are you suggesting they will pass the savings on to us. If you believe in free market economy , then that means competition.

[chaffmeister]

WCWGA is absolutely right.

A SWP-AU merger would create one hell of a dominant player – 50% of country elevator space and control of about 80% of West Coast terminal space; and West Coast terminals would be controlled by 3 entities. Read between the lines – less competition.
Savings in admin and other costs will only get to farmers if there is good competition (not weaker).

Just like the current CWB has no real accountability to anyone – and acts like it, a dominant player of that order of magnitude would have few that could discipline it either.

[SASKFARMER3]

This is a first but yes I agree with her that the SWP agricor merger should not happen We need competition. Look in Farm and ranch guide under elevators of ND and see all the price differences etc. And all the private elevators Their isn't just three.
Second it should be agricor buying SWP that I could live with.(HA HA)

[JohnKenneth]

i'd have to agree. can't see how putting the two together would create any better marketing opportunities.

i also think the argument that the whole thing is a set up for someone to come in and buy the merged company is very interesting. i've heard solid arguments that conagra, ADM or CWB 2 are behind the scenes as potential owner/operators.

i also find it refreshing to hear something new out of the wheat growers. lately it seems like they're falling back into the same old trap of being a one-issue organization.

[just_wondering]

Wheat Growers Oppose the Combination of SWP and Agricore United

Based on feedback from our membership and information gathered to date, the Western Canadian Wheat Growers Association does not support the proposed combination of Saskatchewan Wheat Pool and Agricore United.

"The Wheat Growers are strong proponents of open and competitive markets," says Cherilyn Jolly-Nagel, President of the Wheat Growers. "The combination of the two largest grain companies would lead to an unacceptable loss of competition."

A combined entity would have more than 50% of grain handling capacity on the prairies and an unacceptably large market share in the sale of seed, fertilizer and chemicals.

The Wheat Growers have met with both companies in an effort to better understand the ramifications of any proposed combination.

"While a formal proposal has yet to be presented, we cannot see how this deal could be good for farmers," says Jolly-Nagel. "The Wheat Growers can support alliances that strengthen supply chain efficiencies but in this case, we are not convinced it will lead to higher net returns to farmers."

The Wheat Growers will continue to monitor developments and engage with both companies to ensure farmer interests are served. The Wheat Growers will also make our views known to the Competition Bureau once a formal proposal is issued.

"For any combination to be supported by the Wheat Growers, the onus is on the companies involved to demonstrate that it would provide net benefits to farmers," says Jolly-Nagel. "In this case, no such evidence has been provided to date."

[wd9]

I bet ADM and SWP had special board meetings on how to deal with that anouncement!

Not!

[jensend]

she sounds pretty much like she's speaking for the nfu. benefit to farmers????? oh sure, that's what they had in mind. get rid of the cwb and things won't change because the grain co.'s will take what the board was not getting for you.

[craig]

Jensend I don't understand your comments. WWGA and many farmers believe an open market with competition among buyers is good for business. One day the wheat growers are acccused of being a front for big business the next the NFU. Their comments and their vision are true to their cause. How we get there is open to debate