lity of grain exported on Certificate. Matters have now reached a climax. According to the rules governing the inspection of grain in the State of Illinois-
" No. 2 Hard Winter Wheat shall Include all varieties of Hard Winter Wheat of either or both light and dark colours, dry, sound, sweet and clean, and may contain not more than 25 per cent of Soft Red Winter Wheat, and weigh not less than 59 pounds to the measured bushel."
Large quantities of No. 2 Hard winter wheat, 1915 crop, Chicago inspection, have been sold and shipped in the last few months. A very large proportion of this wheat was neither dry, nor (sound, nor sweet, nor did it weigh 59 pounds per bushel, nor even was it in any degree hard on its arrival in this country. Evidence in support of these statements is provided in Appendix A accompanying this communication.
This is what they have to say in regard to Canada, and I am sure it will be of interest to hon. members of this House and the country generally:
Prior to 1912, serious complaints were made against Canadian grading, but the Dominion - Grain Act of 1912 and the administrative ar-'rangements ancillary thereto, have effected very great improvements so that all European buyers have now confidence in Canadian certificates, and though a great number prefer trading on sample or on standard, they acquiesce in the system of grading and its concomitant " certificate final," as established by Canadian law and carried out by Canadian practice. Therefore in this brief historical review no mention need be made of the communications between European buyers and Canadian representative bodies.
One very important fact which has greatly enhanced the reputation of Canadian grading is this. Both in the United States and Canada a large proportion of the crop is sold before it is reaped. The buyer should be in a position to rely upon the grading rules current at the time the deals are made; in other words, the grain when it is reaped should be graded on its intrinsic merits according to rules which should not be changed from season to season. Canadian law and practice embody this principle. When the weather has been bad during harvest in Canada and the quality of the crop has therefore been depreciated, the statutory grades have nevertheless not been changed, and buyers have obtained grain of the quality they expected and had a right to expect.
With regard to trading in the United States, they say:
The merits or demerits of a system of grading are not ascertained on a crop harvested under favourable conditions. Between the crops of 1908 and 1914, trade with European buyers in United States grain languished. Then came the exceedingly favourable harvest of 1914, and an exceedingly large trade in United States grain, due, among others causes, to the fine quality of the Hard Winter wheat. Even then there was cause for complaint as to irregularities in grading, of which evidence is provided in Appendix "A", but on the whole buyers were satisfied. In that state of mind they made large purchases of the 1915 crop,
and it is important to note that the first arrivals of that wheat were satisfactory. Attention is called to a sample included in the set sent herewith, drawn from a bulk specially certified as New Crop. Such wheat would today command a ready sale on our markets for millers in the United Kingdom much desire to keep such wheats in their current mixtures, and doubtless the quality of these early arrivals induced buyers on this side to greatly increase their purchases. By the later export of grossly inferior and improperly graded wheat, some United States shippers have secured an immediate advantage, for the system of grading and trading on " certified final " appears to protect them from loss of monetary advantage on contracts then existing but the loss of good repute is serious and deplorable. Buyers cannot be fleeced with impunity. A buyer suspicious and unwilling, cannot be a satisfactory source of profit to the seller. For past years Canadian wheat has realized substantially higher prices in European markets than the corresponding grades of United States wheat, and the climax has now been reached in this further sense, that European buyers are restricting their present purchases of graded wheats almost exclusively to Canadian produce.
What more favourable condition than that could we wish to have in Canada? This favourable condition is not only cited by the Corn Associations of the United Kingdom, but is reflected in the markets of Italy, France, Belgium, and of all other countries in which our wheat comes in competition with that of the United States. This, to my mind, is Canada's great opportunity. That the grain producers of Canada have reached the goal to which they have been pressing year by year, steadily if somewhat slowly, is proved by the statement of the Corn Associations of the United Kingdom: that future European purchases will be made almost exclusively in Canada, for the simple reason that European buyers like our wheat and flour, and the way in which we handle the business. That is something of which we can be justly proud; and that is the reason why, within the past thirty days, the Canadian grain merchant who has had wheat at the Atlantic sea ports, available for immediate shipment to the markets of the world, has been able to sell his grain at a high premium. Would it be wise, now that ,we are in sight of this commanding position in the English market, to adopt the resolution before the House, and have our wheat go through American channels, and run the gauntlet of their methods of grading and trading, as described in the report I have just read to this House? Furthermore, in my judgment *it would be a mistake for us to be entangled in any international agreement which might recoil on us in our preparations for the
blessings of peace at the close of this war. For who will deny that, so long as this war continues, the Canadian producer will enjoy the position of advantage he has had during the last sixty days in the markets of the world? In my humble judgment, no class of people will profit more by the present conditions, as described by the corn exchanges of Great Britain, than the producers of grain in the prairie provinces of Western Canada.
The same conditions obtain with respect to flour. Our exports of flour to Britain have been steadily growing year after year. I quoted the other day from the report of a commission appointed by the Government of Saskatchewan, to show how trade was increasing in the United Kingdom, and I would like to again draw the attention of this House to the opinions of that commission :
Canada's Increased Share of United Kingdom Imports.
It is of value to note the increasing quantity of Canadian exports of wheat and flour to the United Kingdom in the face of fairly constant aggregate annual imports of wheat by that country. The wheat imports of the United Kingdom are 196,000,000 bushels annually. This amount does not vary more than 8,000,000 bushels either way from year to year. During the five years ended March 31, 1907, Canada's wheat exports to the United Kingdom averaged
23.763.000 bushels annually. During the next five years, ended March 31, 1912, they averaged
49.893.000 bushels. For the corresponding periods Canada's flour exports to the United Kingdom averaged annually 750,000 barrels (representing 3,375,000 bushels of wheat) and
1.652.000 barrels (7,434,000 bushels) respectively of total imports of the United Kingdom averaging annually 6,646,000 barrels. Thus Canada already supplies rather more than one-fourth of the United Kingdom's wheat and flour imports. Roughly speaking, in these increases, Canadian wheat is replacing Russian wheat and Canadian flour is replacing United States flour. Whether the Canadian miller could continue to compete so successfully with the United States miller were the United States' duty taken off Canadian wheat is a question that only the event can prove. The commission sees no reason why in view of the protected home flour market he enjoys he would not be able to compete successfully.
Here we have a statement, made over a year ago, that Canada was supplying one-quarter of the flour that was being imported into Great Britain. I shall surprise this House, I am sure, when I state that whereas at that time we were exporting to Great Britain a little over 1,500,000 barrels of flour, we are exporting this year 3,500,000 barrels. The report of the commission goes to show that Canadian flour is replacing Russian flour in the British market, but we have the statement of the corn exchanges
that the wheat produced by the Canadian farmer is almost entirely replacing the wheat of the United States, which has been our competitor for so many long years. This Saskatchewan commission states that the producers in Great Britain like our flour and wheat, and also like our methods of handling them. If the Canadian farmer sees any advantage in having his wheat milled in the United States, or if the millers of the United States see any advantage in grinding Canadian wheat, there is nothing in the world to prevent that being done. It will only cost them one dollar for every thousand bushels of wheat they deal with.
What would happen, Mr. Speaker, were we to adopt the resolution of the hon. member for Assiniboia (Mr. Turriff) to allow our wheat to go into the United States markets to engage in the mixing process that has practically ruined their trade in the markets of the United Kingdom, according to the authorities I have read? At best, it could have the effect of using but a small proportion of our good wheat, and that wheat would be mixed with a large volume of the poor wheat of the United States, and then our wheat and our flour would have to come into competition with this product in the markets of the" United Kingdom. I ask you, would that be fair either to the Canadian farmer or to the Canadian people as a whole? Let me point out that the effect which this resolution would have on our whole crop is indicated by the following :
The want of uniformity in the system of grading must result in a lowering of the value of the whole crop, for buyers naturally base their prices on the poorest quality they may receive. Separate grading by the different ports tends to lower the grades in an endeavour to secure trade.
That is exactly what would happen to us should we adopt the resolution befbre the House. We should also lower our grades, and should have to meet the form of mixing employed in the United States. We have to-day a position of great advantage with our wheat, a position which we have won gradually by our own efforts.
Beyond question of doubt all these conditions justify us, having in view the interests of the farmers themselves, in rejecting this resolution, and thereby permitting these favourable conditions to continue.
The farmers of Western Canada have carried on their industry in a manner that has won for them a position of vantage and of respect. At the outbreak of the war, heeding the call of the Allies for increased production, they planted an .unprecedented