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The brave new world of Prairie wheat

A look at the research funding and marketing development behind this rotation staple

Wheat is a staple crop in most Prairie farmers’ rotations, and it’s not likely to be displaced any time soon. It’s still one of Canada’s most important crops, and contributes more than $11 billion to the Canadian economy every year. Although wheat prices may not always get farmers excited, the potential for the crop does, especially now that more investment is going into developing new varieties — including hybrids — and exploring new, international market opportunities.

“We see a tremendous opportunity in wheat going forward, and that’s why we are in the business of collecting a check-off and investing producer funds into research and market development,” says Tom Steve, general manager of the Alberta Wheat Commission. “Over time, we’ve seen diversification into canola and other crops which is a good for the long-term prosperity of farmers. But wheat acres are reliable year in and year out. Most, if not all grain farms grow wheat as part of their rotation, and we see a lot of opportunity because of investments that not only the provincial crop commissions are making, but we see a lot of private sector interest in investing in wheat. In fact, it might be wheat’s turn to take the centre stage.”

A single check-off from August

In January, the three provincial wheat commissions in Manitoba, Saskatchewan and Alberta signed a memorandum of understanding (MOU) to continue their support for wheat variety development and the Canadian International Grains Institute (Cigi) when the Western Canadian Deduction (WCD) ends on July 31, 2017.

The WCD, a transitional levy established in August 2012, to replace the previous check-off administered by the Canadian Wheat Board, ensured continued support for wheat research and market development until the western provinces could establish their own wheat commissions. The WCD collects $0.48 per tonne on all sales of wheat in Western Canada.

The Alberta Wheat Commission (AWC), Saskatchewan Wheat Development Commission (Sask Wheat) and the Manitoba Wheat and Barley Growers Association (MWBGA) said in a press release that they will absorb the responsibilities and financial obligations of the WCD from August 1.

“Fifteen cents a tonne of the WCD funds are allocated to Cigi and $0.30 a tonne goes to fund long-term, wheat varietal development research,” says Harvey Brooks, general manager of Sask Wheat.

After August 1, all the commissions will combine their provincial levies with the $0.48 that was the WCD into a single per tonne check-off. Saskatchewan and Manitoba are moving to a $1 per tonne check-off and Alberta to $1.09 per tonne, because Alberta has a slightly higher provincial check-off amount to begin with.

“We will continue to collaborate and co-ordinate regional research efforts because we recognize that wheat is broader than the provincial boundaries, and we need a regional approach,” says Brooks. “We’re facing common problems with disease and other agronomic issues, and this MOU demonstrates that there will be continuity of the research, variety development and market development efforts that are funded by Canadian producers.”

The wheat commissions are also among the funding organizations that are participating in the development of a Canadian National Wheat Cluster for submission to the next federal Agricultural Policy Framework (APF) that will succeed the current Growing Forward 2 (GF2) program.

“All the wheat-related funding partners have come together to organize themselves around putting in a proposal for a wheat research cluster,” says Brooks. “It’s being facilitated by the Western Grains Research Foundation (WGRF), and includes not only the Prairie wheat commissions, but also wheat grower organizations in British Columbia, Ontario, Quebec and Atlantic Canada. It’s a multi-provincial effort, nation-wide and we’re putting those efforts together to make sure that we have continuity on the wheat cluster when the current GF2 funding runs out in 2018.”

The group is also working with co-funders to request letters of intent for an Integrated Crop Agronomy Cluster, which recognizes that there are a number of agronomic research projects that apply to multiple commodities.

2016 a challenging year

2016 was a bitter sweet year for wheat producers. Although seeded acres were slightly down, yields were up, but many Western Canadian farmers didn’t get to take full advantage of their high yields. With endless summer rains and early snowfalls in the fall, a large number of farmers have quality issues in their wheat, largely as a result of disease.

Agriculture and Agri-Food Canada (AAFC) forecasts that wheat production in Canada will hit 29.1 million tonnes in 2017, which is down about 2.6 million tonnes from 2016, but will still rank as the fourth biggest wheat crop in 20 years. Spring wheat could be up by around six per cent, but durum acres will probably shrink as much as 15 per cent. This reflects the serious issues growers have had with disease over the past season, which will make good quality durum seed hard to find.

Despite the challenges of 2016, wheat is generating a lot of excitement these days. The fact that a Canadian researcher, Dr. Curtis Pozniak of the Crop Development Centre (CDC) at the University of Saskatchewan, is leading the team which has sequenced the bread wheat and durum wheat genomes, has helped spur significant investment into wheat breeding and research across the country.

A truly Canadian crop

Wheat is a truly Canadian crop, grown across every province. The Grain Farmers of Ontario (GFO) are investing producers’ check-off dollars into projects addressing four core priority areas: agronomy and production, weed, disease and insect pests, breeding and genetics, and crop utilization and crop quality.

Current research priorities emphasize projects related to phosphorus management to support GFO’s overall 4R nutrient stewardship strategy to address water quality in the Great Lakes. As of May 2016, GFO had approved four major projects about phosphorus management looking at the impact of cover crops, strip tillage and management zones on phosphorus losses, creation of a baseline ‘landscape sensitivity’ analysis in order to recommend phosphorus best management practices, and how diverse cropping systems affect phosphorus run off losses. The economic and environmental benefits of cover crops, improving nitrogen recommendations and developing new or bio-products from wheat and other crops for existing and emerging markets are also high priority for GFO.

Common research priorities

Wheat research priorities are similar across all the Prairie provinces, which is why there are so many collaborative partnerships and joint funding initiatives supported by the Manitoba, Saskatchewan and Alberta wheat commissions and other industry and government partners. “We are agreed on research priorities and we’re moving ahead, so it looks exciting for the near term but we do have a number of common challenges,” says Brooks. “Producers are looking for increased disease resistance from a number of perspectives. We’re investing further into fusarium and wheat midge research and management efforts.”

All three wheat commissions are involved in research into fusarium head blight (FHB) resistance and management, but for the MWBGA it’s a top priority. “Number one for us fusarium management, everything from varietal improvement to crop control measures, to agronomy, any ways that we can manage fusarium because it has such a significant impact on wheat in Manitoba,” says Lori-Ann Kaminski, research manager at MWBGA, which is also co-funding a project with the Manitoba Pulse & Soybean Growers that is assessing how different rotations affect FHB in the soil.

Wheat is an important rotational crop, which Kaminski feels will become increasingly important, as including cereals in crop rotations helps to combat herbicide resistance and disease problems in some other crops.

Keeping grain moving

Getting grain to the ports is as important as filling the bins, and there is a lot of work being done on the transportation file, following a one-year extension until this August of the provisions of the Fair Rail for Farmers Act, which was put in place during the transportation crisis of the 2103-2014 crop year. The provisions include the authority to regulate interswitching arrangements (between different carriers), set out level-of-service obligations for railway companies, and prescribe a minimum amount of grain to be moved by Canadian National Railway (CN) and Canadian Pacific Railway (CP) during any period within a crop year.

Brooks says he also expects an announcement early this year about the maximum revenue entitlement (MRE), which sets limits on the average revenue per tonne, for a given length of haul, that CN and CP can earn for shipping western Canadian grain. “The report of the Standing Committee on Transport, Infrastructure and Communities that was released in December appeared to signal that at this point, the Committee didn’t see any potential for removal of the MRE, which would be good news,” says Brooks. “The MRE is working, and it ensures that railways are well compensated and that farmers are not subject to undue rail freight prices.”

Cereals Canada a strong wheat advocate

The wheat industry has a relatively new advocate in Cereals Canada, a national, non-profit organization that brings together wheat industry stakeholders, such as farm organizations, grain handling, export and processing companies, and crop development and seed companies. Its mission is to enhance the competitiveness of the Canadian cereals industry by providing leadership on initiatives of common interest to the whole value chain, including innovation, market development and advocacy.

Cereals Canada focuses on market development and support, and participated — along with the Canadian Grain Commission and Cigi — in the 2016 Canadian Wheat New Crop Missions, which ran for seven weeks from the beginning of November to mid-December. The missions kicked off with sessions for Canadian millers, then went on the road to reach customers in 17 countries in Asia, Latin America, Europe, North Africa and West Africa. They include representatives from the whole value chain, including farmers and exporters to provide information about Canada’s wheat crop and provide feedback about what customers want back to the industry. “The feedback is shared back through the value chain, to farmers, and also to the research community, so our research efforts can be focussed on what both farmers and end-use customers are looking for,” says Cam Dahl, president of Cereals Canada.

While the Alberta Wheat Commission and MWBGA are Cereals Canada, the Sask Wheat board of directors has declined to join Cereals Canada.

Trade deals essential

Canada is a major wheat exporter, which means international trade agreements are vital. With the new U.S. administration already scrapping the Trans-Pacific Partnership and making noises about revamping other agreements such as the North American Free Trade Agreement, what will this mean for exports of wheat to the U.S. and other international markets?

“It’s important that our governments now move quickly forward with completing the trade agreement that we had started with Japan, and to look at other potential bilateral agreements because trade is critically important to us as an industry,” says Dahl. “As far as response to the election in the U.S., trade is important from both sides of the border. We are the U.S.’s best customer and I can’t envision the trade relationship between our two countries not existing, so I don’t think we should push the panic button yet.”

About the author

Contributor

Angela Lovell is a freelance writer based in Manitou, Manitoba. Visit her website at http://alovell.ca or follow her on Twitter @angelalovell10.

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