Competition matters more than ever for prairie farmers

By Bill Prybylski

Cargill's plan to acquire grain handling assets that Parrish & Heimbecker bought only months ago has pushed grain sector consolidation back to the forefront. The transaction follows a series of major changes in Canada's grain industry, including the Bunge-Viterra merger and P&H's acquisition of GrainsConnect. Together, these developments raise an important question. What does continued consolidation mean for Canadian farmers?

Bill Prybylski is the President, Agricultural Producers Association of Saskatchewan (APAS)

For producers, competition is not an abstract economic concept. It determines where we deliver grain, how many bids are available, the services offered in our communities and, ultimately, the prices we receive for our crops.

APAS supports a competitive and efficient grain handling system. Investment in infrastructure, export capacity and logistics is critical to maintaining Canada's position as a reliable supplier of agricultural products. Companies must be able to grow, invest and compete globally. But growth through consolidation warrants scrutiny when it has the potential to reduce producer choice.

The Competition Bureau's review of grain industry transactions shows why strong oversight matters. A fair, competitive and transparent marketplace depends on it. Regulators must examine these deals rigorously and independently, and ensure producers retain meaningful marketing options and bargaining power.

This transaction also reinforces the importance of the federal government's ongoing work on competition throughout Canada's food supply chain. That work should continue, focused on market power and value distribution across the entire chain, and on the troubling gap between the commodity prices farmers receive and the prices consumers ultimately pay.

Competition also depends on transparency. Canadian grain farmers operate at an information disadvantage compared to many of their international counterparts. Countries such as the United States publish timely export sales data. Canadian producers lack the information they need to fully understand global demand and market conditions. Canada should implement timely export sales reporting. It would sharpen price discovery, strengthen supply chain planning and give farmers real insight into market demand.

Producer confidence is also shaped by the contracts used to market grain. As the industry consolidates, we must modernize grain contracts for greater clarity, predictability, transparency and balance. Those changes are what allow producers to manage risk safely and make informed marketing decisions.

We must also bolster the Canadian Grain Commission. The CGC remains Canada's only farmer focused agency. It must strengthen that focus and stay vigilant in enforcing essential safeguards around grading, dockage, payment protection and grain transactions. Maintaining them is essential to preserving producer confidence as the major grain companies continue to grow.

The reality is that Saskatchewan farmers operate in a global marketplace. We have little influence over global commodity prices, transportation costs or international markets. The one thing producers deserve is a competitive domestic grain handling system that provides meaningful choice and fair market opportunities.

Consolidation is not automatically good or bad. But every transaction deserves careful examination through the lens of its impact on farmers. A strong agricultural sector depends on producers remaining active and protected participants in a marketplace dominated by international companies.