Canada's largest grain handler Viterra ripe for foreign takeover

International capital is circling around Viterra Canada's largest grain handler just waiting to gobble it up now that it has become more valuable after the Canadian Conservative government has broken the monopsony of the Canadian Wheat Board. Viterra itself is now itself part of the global conglomerates involved in grain handling. Viterra has operations in the U.S. New Zealand and Australia and even China and has expanded into areas such as food processing.

A UK paper reports that a Swiss firm Glencore PLC has made a bid of 5.5 billion dollars for Viterra. The Wall Street journal also reports that the huge U.S. based agribusiness Cargill Inc. is also interested in buying Viterra.

On Friday Viterra share surged almost 25 per cent. Viterra will also benefit by the eliminationof the Wheat Board control over marketing western wheat and barley.

The formation of Viterra itself is the culmination of the complete destruction of farmer controlled Pools that were begun during the depression and even before to protect farmers from the power of giant grain buyers such as Cargill. However, first the Alberta Wheat Pool and the Manitoba Wheat Pools were merged and privatized as Agricore and finally the Saskatchewan Wheat Pool also ended up privatized as Viterra which is a merger of Sask. Wheat Pool and Agricore. For more about the Pools see this article. and this. Now all these farmer-controlled institutions are replaced by Viterra the sort of giant that farmers in the early part of the century were protecting themselves from! It is only fitting that the company be taken over by another competing giant to help form an oligopoly that has the power to dictate prices to farmers. For much more see this CBC article.

Wheat Board supporters protest on Parliament Hill

 A group of farmers opposed to the Conservative government's bill to end the Wheat Board monopoly on marketing wheat and barley in western Canada protested on Parliament Hill yesterday. Drew Baker the farmer who led the rally said: "On our own, we will have little power to negotiate with big American companies, and that concerns me." The U.S. has long challenged the Wheat Board monopoly as giving Canadian farmers an unfair advantage in global marketing.
     Where the U.S. complaints have always failed , western farmers themselves have now achieved what the U.S. and the grain marketing giants have long desired, an end to the Wheat Board monopoly. Farmers have done so by voting in large numbers for the very Conservatives who promised as part of their platform to end the monopoly. A  Wheat Board organised vote later showed that a majority of farmers actually support retaining the system.
     The board is run by directors elected by farmers. Only two of the elected board members favor the changes in the government bill. The remainder support the retention of the single desk system as it is called. The system gives the farmers collectively considerable power to negotiate good prices for grain sales.
      The government legislation would also dismiss the farmer-elected directors of the board. The board had been controlled by members elected by farmers since 1998.
       The Wheat Board has launched a lawsuit challenging the government's bill. The suit claims that the bill violates the Canadian Wheat Board Act. The Wheat Board Act specifies the minister cannot change the system without holding a vote of Prairie grain farmers. The  Agriculture Minister Gerry Ritz promised during the latest election campaign a vote would be held. The only vote held was by the Wheat Board itself. The Conservatives claim that the abolition of the monopoly was a prominent part of the campaign platform and since they were elected with a majority they already had a mandate to change the system. For much more see this article.