Vol. 144, No. 7 — March 31, 2010

Registration

SOR/2010-60 March 11, 2010

CANADIAN WHEAT BOARD ACT

Regulations Amending the Canadian Wheat Board Regulations

P.C. 2010-263 March 11, 2010

Her Excellency the Governor General in Council, on the recommendation of the Minister of Agriculture and Agri-Food, pursuant to subparagraph 32(1)(b)(i) (see footnote a), subsection 47(2) (see footnote b) and section 61 of the Canadian Wheat Board Act (see footnote c), hereby makes the annexed Regulations Amending the Canadian Wheat Board Regulations.

REGULATIONS AMENDING THE CANADIAN WHEAT BOARD REGULATIONS

AMENDMENT

1. Subsection 26(4) of the Canadian Wheat Board Regulations (see footnote 1) is replaced by the following:

(4) The sum certain that the Corporation is required to pay producers on a per tonne basis under paragraph 32(1)(b) and section 47 of the Act in respect of the base grade of barley sold and delivered to the Corporation during the pool period ending on July 31, 2010 and known as Select Canada Western Two-Row selected and accepted for use in the production of barley flour, barley malt or pot or pearled barley is:

(a) $186.50 for straight barley;

(b) $179.50 for tough barley; and

(c) $173.00 for damp barley.

COMING INTO FORCE

2. These Regulations come into force on the seventh day after the day on which they are registered.

REGULATORY IMPACT
ANALYSIS STATEMENT

(This statement is not part of the Regulations.)

Issue and objectives

Pursuant to the Canadian Wheat Board Act, grain producers receive an initial payment upon delivery of grain to the Canadian Wheat Board (CWB) pool accounts. Revenues from the sale of grain are pooled by the CWB and any surplus over the initial payment minus marketing costs is distributed to producers after the end of the pool period as a final payment. The initial payment is guaranteed by the federal government and any pool account deficits are paid by the federal government. The CWB operates a pool account for each of four classes of grain for which it has responsibility (wheat, amber durum wheat, barley and designated barley).

In accordance with the Act, the Governor in Council, by regulation, establishes the initial payment for a “base” grade for each of the four pool accounts, following a review of recommendations made by the CWB, and approves the initial payment for other grades established in relationship to the “base” grade as recommended by the CWB. The initial payments are set at the beginning of the pool period and are adjusted throughout the pool period as the CWB makes additional sales and as the market prices dictate. The CWB’s recommendations are based on relative market returns expected for each grade during the current pool period.

The CWB has recommended that an increase be made to the initial payments for designated barley as sufficient sales have been made since the initial payments were set on August 1, 2009.

The objective of this regulatory action is to adjust the initial payments for the base grade of designated barley which is Select Canada Western Two-Row. The initial payments for the other grades of designated barley are then adjusted by Order in Council.

Description and rationale

Section 26 of the Canadian Wheat Board Regulations establishes the initial payments to be paid upon delivery for grains delivered to the CWB. The amendment adjusts the initial payments for the 2009–2010 pool period for the designated barley pool account. Comparing the proposed initial payments to those set on August 1, 2009 for the base grades, the CWB has made sufficient sales to recommend an increase of $26.50 per tonne for designated barley.

The higher initial payment will represent increased revenues to barley producers for their deliveries to the CWB. The initial payment adjustments to all grades in the pool account, including the base grade, would represent approximately $40 million in additional grain receipts for barley producers. Producers will receive these additional receipts in one of two ways. For grain deliveries on the day that the increase becomes effective and thereafter until the end of the pool period on July 31, 2010, producers will receive the higher initial payment. For grain deliveries during the pool period, but prior to this amendment coming into force, producers will receive an adjustment payment per tonne, equivalent to the difference between the initial payment prior to the increase and the new initial payment.

The increase in the initial payments should not create the risk of a deficit in the pool account. A minimum 35% safety factor for unpriced grain has been used to account for market uncertainties. Although the increase in the initial payment increases the risk of a deficit compared to no increase, the actual risk to the federal government is minimal.

The initial payments established by these Regulations relate to the returns anticipated from the market and thus transmit market signals to producers. There is no environmental impact of this amendment.

Consultation

Initial payment levels have been recommended by the CWB. The Department of Finance has been consulted and concurs with the recommendations.

Implementation, enforcement and service standards

The schedules come into effect on the seventh day after the day on which they are approved by the Governor in Council.

There is no compliance and enforcement mechanism. These Regulations govern payments made to grain producers for deliveries made under the Canadian Wheat Board Regulations.

Contact

Marcia Armstrong
Grain Policy Division
Agriculture and Agri-Food Canada
1341 Baseline Road
Ottawa, Ontario
K1A 0C5
Telephone: 613-773-2709

Footnote a
S.C. 1995, c. 31, ss. 2(1)

Footnote b
S.C. 1995, c. 31, s. 4

Footnote c
R.S., c. C-24

Footnote 1
C.R.C., c. 397

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