Changes at Cigi
Oct. 9, 2012
by Leo Quigley
The demonopolization of the Canadian Wheat Board (CWB) at the end of the crop year (Aug. 1, 2012) has already had a ripple effect on Canada’s agricultural community, and one of the organizations impacted by the wave has been the Canadian International Grains Institute (Cigi).
Long respected as an agency that bills itself as having “worked with the agricultural community worldwide in the promotion and utilization of Canadian field crops,” the Winnipeg, Manitoba-based institute lost the funding provided by the CWB on April 1, 2012.
For Earl Geddes, who has been Cigi’s executive director for the past three years, the new marketing environment has meant a sea change in the way the institute provides programs to agri-industry and funds its operations.
To the institute’s credit, it had laid out a strategic plan in March 2010 to determine how it could best survive without the CWB.
“Part of that strategy was a sustainability plan given that, at some point, the CWB might lose its mandate or the government might stop funding Cigi,” Geddes said. “So we’ve been working since March 2010 in building commercial business agreements with international customers — for example, Warburtons Bakery in the U.K. that supplies bread products right across Europe.
“We do their harvest assessment work and a lot of their technical work right here at Cigi under a commercial agreement,” he said. “It consists of doing wheat analysis, flour milling analysis and the baking analysis. They have about 500 growers in Western Canada, and we’ll examine their harvest samples and work with Warburtons as they determine how to pull that grain into their system as they need it over the course of the next year.
“It’s a good commercial relationship both for Warburtons and ourselves,” he said.
Cigi also works with Saudi Arabia’s Grain Silos and Flour Mills Organization and, last year, had 12 millers for six months of training and are repeating the program this year. Geddes said he expects this program and other similar programs to continue into the future on a commercial basis.
“Cigi’s a very interesting place, and we’ve got expertise that doesn’t exist in any one institution any place else in the world. For example, there are Canadian wheat customers in Malaysia who will call Cigi and say, ‘We’re having trouble using Canadian flour in our steam buns process. Can you help us out?’ So we’ll send somebody to Malaysia to spend time in the processing plant and help them resolve the problem,” he said.
Check-off on wheat, barley
Finding funding to replace the CWB’s major contribution of roughly 70% of costs has also been a success with the establishment of an interim check-off on wheat and barley delivered to licensed elevators in Western Canada.
The check-off program, which follows from Bill C-18 (the Marketing Freedom for Grain Farmers Act) will be administered by the Alberta Barley Commission and will be used to fund Canada’s Western Grains Research Foundation, the Canadian International Grains Institute and the Canadian Malting Barley Technical Centre at the “same level of funding they received through the previous arrangements.”
The new check-off is temporary, however, and is set to last up to five years.
Beyond that time frame, the legislation says: “It will be up to the grain industry to have developed and administered its own check-off, if it considers this to be a priority for the sector.”
The new voluntary check-off will specifically support:
•research activities into “new and improved” grain varieties;
•promotion of the marketing and use of grain grown in Canada; and
•technical assistance relating to the use of grain grown in Canada.
The check-off will be deducted at point of sale and will appear as a deduction on the cash purchase tickets issued to farmers when they deliver grain.
“This will be done in a manner that is fully transparent so that farmers can see the full amount of their support to grain research,” the advisory said.
According to the legislation, the check-off “will not apply to imports, producer-to-producer sales, sales of feed and/or exports not delivered through licensed facilities. It will apply to sales of wheat and barley grown in Manitoba, Saskatchewan, Alberta and the Peace River region of British Columbia and delivered to licensed facilities issuing cash purchase tickets.
“Producers will be able to request refunds of their check-off dollars,” the statement said.
Also, the proposed regulations “will not impede the development of additional check-offs under existing provincial and federal regulation.”
No change in pulses
Geddes said the work the institute does with crops other than wheat and barley will carry on as usual.
“For example, in the pulse industry we’re working very closely with Pulse Canada in Alberta, Saskatchewan and Manitoba Pulse Grower groups on a four-year flour milling and flour utilization program working with pulses such as peas, beans and lentils.
“We have milled wheat and durum for hundreds of years and know everything about what’s inside a kernel of wheat and durum. But when it comes to lentils and peas, we do not have a good understanding. So we’re following some of the same milling protocols that we use with wheat and durum with pulses and identifying the various constituents of the flour streams, and we’re now in the middle of that project developing new prototypes in collaboration with international food and ingredient companies. We expect to see 30 percent of our activity focused on pulse crops over the next five years.”
He said the institute also works for commercial companies in developing industrial products and collaborates with food development centers such as the Alberta-based Food Processing Development Centre in Leduc in developing new products.
Also, Cigi collaborates with the American Association of Cereal Chemists on the establishment of various testing protocols to ensure commercial validity of the tests that are being used to determine the functional properties of field crops.
Staff levels at the institute since the change have stayed fairly static at about 36 people, Geddes said. He said not much will change “until we get a really good feel as to where the industry wants to go, because it is the industry that will direct Cigi over time.”
“However, it’s taking some time for the industry to get its legs underneath it and figure out how it wants to organize to provide us direction. In the interim, we have a Cigi board here that has added three farmers, because they (farmers) are going to be funding us directly. As well, we have two program advisory committees, one comprising seven farmers from Western Canada and the other a group of marketers formed by the Western Grain Elevators Association. Both groups have been set up to give advice and direction on Cigi’s programming activities.
This, he said, will suffice until there’s a larger council of some type.
“It’s an environment in which there simply hasn’t been an over-arching wheat council of some type, because the wheat board filled most of those roles,” he said. “We don’t sell wheat. That’s one of the key things that we’re able to roll into this new environment is this independence.
“Customers can come to us, knowing that we don’t sell the wheat. All we do is demonstrate what they can expect from the crop and how to utilize it properly. Cigi has gained a fair amount of respect internationally for that independence.”
For 40 years, institute programming had been very much influenced by the wheat board and, prior to the change, people in industry and government would often see Cigi and the CWB as “attached at the hip,” he said.
But Geddes said since the new strategic plan has been put in place, Cigi has become “very much its own entity and more focused on client service and expanding its commercial stability and footprint.”
“We’re quite a different organization now,” he said.
Based in Vancouver, British Columbia, Canada, Leo Quigley writes for a variety of national and international publications specializing in agriculture and transportation. He can be reached at Quigley@dccnet.com.