March 21, 1929

PRO

Archibald M. Carmichael

Progressive

Mr. CARMICHAEL:

I will come to that later. The average price for the year 1925 was $1.25 per bushel; and for the year 1926, $1.08. During 1927 there was considerable wet, damp and tough grain. The weather conditions were very adverse in our province during that year, and the average price received was only 97 cents per bushel. We will not take any one year, but we will add the four of them together and take the average of the average prices of the four years. The total is $4.51, and dividing that by four we get an average price of $1.12f for the four years during which the pool operated. The same publication tells us that the average price of the 1928 crop was 77 cents a bushel.

Topic:   GRADING OF GRAIN
Subtopic:   WHEAT-INSPECTION, SHIPMENT AND PROTEIN CONTENT-REFERENCE TO COMMITTEE ON AGRICULTURE
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LIB

Malcolm McLean

Liberal

Mr. McLEAN (Melfort):

How does the hon. member know?

Topic:   GRADING OF GRAIN
Subtopic:   WHEAT-INSPECTION, SHIPMENT AND PROTEIN CONTENT-REFERENCE TO COMMITTEE ON AGRICULTURE
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PRO

Archibald M. Carmichael

Progressive

Mr. CARMICHAEL:

My hon. friend will have to ask the Department of Trade and Commerce.

Topic:   GRADING OF GRAIN
Subtopic:   WHEAT-INSPECTION, SHIPMENT AND PROTEIN CONTENT-REFERENCE TO COMMITTEE ON AGRICULTURE
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LIB

Malcolm McLean

Liberal

Mr. McLEAN (Melfort):

Who is the

author?

Topic:   GRADING OF GRAIN
Subtopic:   WHEAT-INSPECTION, SHIPMENT AND PROTEIN CONTENT-REFERENCE TO COMMITTEE ON AGRICULTURE
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PRO

Archibald M. Carmichael

Progressive

Mr. CARMICHAEL:

I shall have to refer my hon. friend to a department of the government for the authority. It is printed by F. A. Acland for the Department of Trade and Commerce.

The average price over the four-year period was $1.12$ and in 1928 the price was 77 cents. The difference, which is 35$ cents per bushel, represents the loss on the 1928 crop. If you take that on the total crop of 511,444,000 bushels, you have a figure amounting to more than $175,000,000.

Topic:   GRADING OF GRAIN
Subtopic:   WHEAT-INSPECTION, SHIPMENT AND PROTEIN CONTENT-REFERENCE TO COMMITTEE ON AGRICULTURE
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LIB

James Malcolm (Minister of Trade and Commerce)

Liberal

Mr. MALCOLM:

Does my hon. friend attribute the loss in price on last year's crop to the administration of the act, or does he give any credit to the frost of the season and a lower grading on account of the frost?

Topic:   GRADING OF GRAIN
Subtopic:   WHEAT-INSPECTION, SHIPMENT AND PROTEIN CONTENT-REFERENCE TO COMMITTEE ON AGRICULTURE
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PRO

Archibald M. Carmichael

Progressive

Mr. CARMICHAEL:

If the minister had caught my remark, I attributed the loss to two things: first, the unscientific grading of

1152 COMMONS

Grading of Grain-Mr. Carmichael

our wheat, and, second, the ineffectual administration of the Canada Grain Act. Those two factors are responsible for the loss of $175,000,000 to the farmers of the three prairie provinces. That is seven times the amount that we will realize from the so-called, much approved Robb budget of this year.

Topic:   GRADING OF GRAIN
Subtopic:   WHEAT-INSPECTION, SHIPMENT AND PROTEIN CONTENT-REFERENCE TO COMMITTEE ON AGRICULTURE
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LIB

James Malcolm (Minister of Trade and Commerce)

Liberal

Mr. MALCOLM:

Does my hon. friend argue that we could devise a method of grading-the hon. member for Qu'Appelle (Mr. Millar) spoke of protein content- that would give an additional $175,000,000 to the farmer for a frost-affected crop?

Topic:   GRADING OF GRAIN
Subtopic:   WHEAT-INSPECTION, SHIPMENT AND PROTEIN CONTENT-REFERENCE TO COMMITTEE ON AGRICULTURE
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PRO

Archibald M. Carmichael

Progressive

Mr. CARMICHAEL:

According to the evidence produced before the agriculture committee I am quite satisfied that a method can be devised whereby the value of the wheat will go to the producer thereof, rather than to the milling interests or to the commission men, who are the middlemen in between the producer and the consumer. This is such a serious feature that I attribute a great deal of importance to it, much more so than possibly the hon. member for Willow Bunch (Mr. Donnelly) does. He tried to give the house the impression that the matter was of rather minor importance. It is of a great deal of importance and it is the chief cause of unrest in western Canada.

I should like to deal for a short time with the matter as it appears from the viewpoint of the farmer under perhaps three different headings: his lot and condition prior to the operation of the pool; his situation under the four years of pooling grain, and his situation during the 1928 crop season. I will deal more particularly with my province of Saskatchewan-the pool operated in Alberta in 1923, but the quantity of grain handled was so small that it did not have any appreciable effect on world prices. In 1924 we had really the inauguration of wheat-pool marketing on a large scale. Let us take the year 1923 and consider the lot of the individual farmer during that year. According to this publication the statistics were as follows:

Total world production. 3.818,000,000 bushels.

Western Canadian crop, 454,000,000 bushels. Price realized

Manitoba, 67 cents per bushel.

Saskatchewan, 65 cents per bushel.

Alberta, 65 cents per bushel.

When the individual farmer came to reckon up his accounts in the fall of the year, and pay for the expanse of handling the crop, the cutting, twine, threshing, hauling, different interest accounts and store accounts, he found that he was behind. He found that it cost him more to handle his crop than he realized from it, and in my particular section of Sas-

katchewan there was a great deal of unrest among the farmers. It was freely stated there that it cost in the neighbourhood of $1 a bushel to market that crop. I am not going to take that 'because it might be considered an extreme figure. An hon. member in this corner of the house told me that he kept close track and he found that it cost him 93 cents a bushel to handle that crop. Supposing we take the figure of 90 cents a bushel, which is well within the mark, and the farmer realized 65 cents; that is, he lost 25 cents on every bushel he produced. If he produced 2,000 'bushels of grain that year he lost $500. If he produced 3,000 bushels, he lost $750. If he produced 5,000 bushels, he lost $1,250. The more bushels he produced, the more he lost. Is there then, any reason for wondering that the farmer was very much discouraged? The morale of the fanner at that particular time was exceedingly low. In fact, many of them who were able to get out of the farming business did so. But those who had the desire to1 stick there were instrumental in bringing about the formation of the wheat pool which began operations the next year, 1924. Let us glance at the operation of the wheat pool during those four years. In 1924 the total world production was somewhat less than in 1923, less by 349,000,000 bushels and the western Canadian crop was less by more than 200,000,000 bushels. Some would be prepared to say that that accounts for the enhanced price. We will let them say so. These are the prices during the crop year of 1924:

Per bushel

Manitoba $1 24Saskatchewan

1 21Alberta

1 20

That is quite an advance over the prices of the previous year. Let me give the figures for the next year, 1925:

Bushels

Total world production.. .. 4,030.000,000

Western Canadian crop.. .. 372,000,000

That is, the total world production was con* siderably more than that of 1924 and also more than that of 1923, and the western Canadian crop in 1925 was considerably more than that of 1924. But how dto we find the prices?

Per bushel

Manitoba $1 22Saskatchewan

1 25

That is four cents over the price of 1924.

Alberta $1 19

Let us take the next year, 1926:

Bushels

Total world production.. .. 4,178,000,000

Western Canadian crop.. .. 385,000,000

Grading of Grain-Mr. Carmichael

Both greater than that of the preceding year. Yet when we look at the prices, they are as follows:

Manitoba $1 09Saskatchewan

1 08Alberta

1 05

It will be noticed that the price is still keeping up even though the world production is increasing each year. The figures for 1927 are

as follows:

Bushels

Total world production.. .. 4,204,000,000Western Canadian crop.. .. 457,000,000

Both greater again. That was the year of adverse weather conditions, and yet the prices were as follows:

Per bushel

Manitoba $1 06

Saskatchewan 97

Alberta 98

We can see that during those four years the farmer was receiving considerably more for his labour than he did during the year 1923. As a result, his morale improved considerably, and his financial standing in the community was enhanced to no little extent. This was all brought about by the orderly marketing of his crop through the wheat pool, and by the elimination of the middle man.

I would like to point ou't that the enhanced prices given to the farmer were partly brought about by the pool method of marketing, and with all due respect to what my hon, friend from Willow Bunch has said about mixing, considerable profit did accrue to the pool members through the mixing of grain at the head of the lakes.

Here is another point that we who are interested in this matter should notice. There are approximately 5.000 country elevators scattered over the three prairie provinces. Approximately 1,000 of these are owned and controlled by the three western wheat pools, leaving 4.000 owned and controlled by the grain trade. In the province of Saskatchewan the wheat pool handles about 60 per cent of the wheat. There you have a rather peculiar situation. The pool handles about 60 per cent of our Saskatchewan wliea-t, and yet we have only 20 per cent of the elevators through which to handle it. They handle the larger part of the Saskatchewan crop through a small number of elevators at country points. Knowing the importance of having the wheat go through their own terminal elevators, every effort is made to get every pool member to ship his grain through his own pool elevator to his own pool terminal. I do not think I need amplify that point.

Hon. members know that at the head of the lakes the mixing privilege prevails. Con-78594-73

siderable mention has been made of mixing.

I need only to refer to what is called the Price, Waterhouse report of 1918 to give you some idea of the large profits that are made by the terminal elevators a.t the head of the lakes. In opposition to what one hon. member said as to the unimportance of this point,

I would like to emphasize its importance, and that is that pool wheat, in the opinion of pool members, should go through pool country elevators and go to pool terminals.

There is another advantage to be gained. In the 1927 crop year, we were paid li cents a bushel for every bushel we shipped through the pool elevator. If a man shipped 10,000 bushels of wheat through a pool elevator, he would get a cheque for $150, which is a nice little sum to get from the profits of these elevators. That makes the farmers naturally want to have their wheat go through their own elevators, but here is the unfortunate situation. There are not sufficient elevators to handle all the wheat which the pool members wish to market. In my own town last year the pool elevator was plugged to the roof practically all through the shipping season. Millions of bushels of pool grain must go through other elevators to get to the head of the lakes if it is to get there at all during the crop year. That brought about a situation where the pool had to make an agreement with the grain trade, and they did enter into an agreement whereby pool wheat would be handled by their country elevators, but on the strength of the 1927 amendment to the Canada Grain Act such wheat could be sent to pool terminals if the grower of the grain so desired. That is where the whole trouble comes in, That is where we have our quarrel with the administration of the Canada Grain Aclt. I am not particular whether the Minister of Trade and Commerce gets into the quarrel and takes the responsibility or not. The responsibility rests upon the Board of Grain Commissioners, and the board being a part of Ithe department, I do not see how the minister can very well entirely evade all responsibility. I have covered the four year period. Let us now look at the individual farmer during the 1928 crop year.

In the year 1928 also we had a large world production of wheat. I have not the complete returns, but the figure I have is that the world production, excluding Russia and China, was 3,780,000,000 bushels. If the totals from Russia and China are included, the world's production would probably be greater than in 1927. Our western Canadian production was over 513,000,000 bushels, but our price in Manitoba was 92 cents, in Saskatche-

1154 COMMONS

Grading oj Grain-Mr. Carmichael

wan 77 cents, and in Alberta, 75 cents. Let us see what that means. The 1928 Saskatchewan price was 44 cents per bushel less than the 1924 price, 48 cents a bushel less than the

1925 price, 31 cents a bushel less than the

1926 price, and 20 cents a bushel less than the 1927 price, when we had a great deal of inferior grain which had to be reconditioned and put through the drying elevators. That represents a tremendous loss to the agriculturists. I pointed out earlier in my remarks that it represents an average loss to the farmer of 35f cents a bushel on the movement of the 1928 crop. Bringing it down to the individual farmer, I have figured it out on a basis of 90,000 pool farmers, with an average production of a little over 2,000 bushels, and taking this loss of 35J cents a bushel means a loss to each pool member, and by the way, that is the farmer I am particularly interested in in this connection, of over S700 for the 1928 crop year. Now if we apportion the $25,000,000 saving as outlined in the Robb budget among the 90,000 pool farmers, do you know, Mr. Speaker, what it would amount to? It would amount to just a little over $13 a year to each one of these pool farmers who had stood a loss of over $700 in the movement of the 1928 crop. How long a time, then, and how many more of the so-called beneficial Robb budgets would we have to have for the pool farmer to make up his loss in one year? It would take just about fifty-five years, and that is a little too long for most of us to wait.

The hybrid ticket has been mentioned, and it is not necessary for me to dwell on that The intention of the 1927 amendment to the Canada Grain Act was to give the producer of grain the right to designate to what terminal elevator his grain should go. The grain trade seemingly has been able to circumvent that intention. Thus far they have been enabled to do so by means of the agreement which they were able to force-[DOT] I might almost use that expression-from the pool officials. I use the expression "able to force " from them, because the agreement was not consummated until just before the movement of the 1927 crop began. Here were the farmers throughout the country with grain to move and no agreement consummated between the pool and the trade. The trade was able to say: Here is what we will give you; take it or leave it. In that way they forced the agreement on the pool authorities, and after getting them in that corner the trade tried to make it a six-year agreement. It was finally adjusted on a three-year basis, which means that the agree-

ment operated for 1927 and 1928, and will operate for 1929, when it terminates. I presume that if during that time the trade realize as much out of our grain as they did in the 1928 crop year, they will be able to lie low for a while thereafter. I hope, though, before the movement of the 1929 crop we will have some action.

The Board of Grain Commissioners are coming in for a share of criticism to which they are certainly entitled. They are a body of men well paid, and apparently well qualified to administer the Canada Grain Act. And yet they have failed to administer it properly. Resolutions have been passed by at least two of our farm bodies in t'he west. I have before me such a resolution passed by the Saskatchewan section of the United Farmers of Canada assembled in annual convention last month. The resolution reads:

Whereas the present board has demonstrated its inability to supervise in any manner the operations of country elevators, and for all practical purposes has ceased to fulfil the purpose for which it was originally appointed;

And whereas the producers of grain have lost confidence in the present board;-

Omitting part of the resolution I direct the attention of the house to the following words:

Be it resolved that this convention demands the removal of the present Board of Grain Commissioners.

That, Mr. Speaker, is the almost unanimous opinion of the farmers of western Canada today; they are demanding the removal of the Board of Grain Commissioners. They are not charging them with dishonesty; neither has any member of this house, so far as I know; they are simply charging them with failure to carry out what they were appointed to carry out. In a word, the commissioners have failed to administer the Canada Grain Act property. The public of western Canada has lost confidence in the board, and no matter what amendments might be proposed to the act, no matter how far in the agriculture committee we might investigate the board, it is my opinion that we cannot bolster up that public opinion any longer to tolerate the administration of the act by the present board. The demand is insistent that a change be made in the personnel. If the Minister of Trade and Commerce wishes to be fair to public opinion in the west and to what,

I believe, he knows to be fair himself, I think he will agree with me that it is time that the wishes of the agriculturists of the prairie provinces should be considered and the required change made.

Grading of Grain-Mr. Dunning

The motion before the house is, of course, that this report be concurred in. The report calls for enlarged powers in order that the committee may consider and report on the subject of storage, shipping, mixing, inspection and grading of grain. They are all very good, they all should be considered. But from that report has been left out the most essential part so far as the farmers of western Canada are concerned; there is no mention of the committee taking into consideration the administration of the Canada Grain Act. I am of opinion, Mr. Speaker, that this omission should be made good, that the committee should investigate the administration of the Canada Grain Act. But I am not prepared to admit that the action which we are looking for by the Department of Trade and Commerce should be deferred until such investigation is made. No matter how much investigating may be carried on, no matter how dense a smoke screen may be thrown around the activities of the Board of Grain Commissioners in the course of the investigation by the committee on agriculture, I am of opinion that this investigation would not restore public confidence in the present members of the Board of Grain Commissioners.

Topic:   GRADING OF GRAIN
Subtopic:   WHEAT-INSPECTION, SHIPMENT AND PROTEIN CONTENT-REFERENCE TO COMMITTEE ON AGRICULTURE
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LAB

Herbert Bealey Adshead

Labour

Mr. ADSHEAD:

Does the hon. member

think a smoke screen will be thrown around the investigation before the agriculture committee?

Topic:   GRADING OF GRAIN
Subtopic:   WHEAT-INSPECTION, SHIPMENT AND PROTEIN CONTENT-REFERENCE TO COMMITTEE ON AGRICULTURE
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PRO

Archibald M. Carmichael

Progressive

Mr. CARMICHAEL:

My experience has

been that more smoke than screen is thrown around whatever we undertake to investigate. Such a dense cloud of smoke is thrown around the real issue that it becomes more or less obscured as the investigation proceeds.

Topic:   GRADING OF GRAIN
Subtopic:   WHEAT-INSPECTION, SHIPMENT AND PROTEIN CONTENT-REFERENCE TO COMMITTEE ON AGRICULTURE
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LAB

Herbert Bealey Adshead

Labour

Mr. ADSHEAD:

Does not the hon. member think that some good suggestions may be made?

Topic:   GRADING OF GRAIN
Subtopic:   WHEAT-INSPECTION, SHIPMENT AND PROTEIN CONTENT-REFERENCE TO COMMITTEE ON AGRICULTURE
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PRO

Archibald M. Carmichael

Progressive

Mr. CARMICHAEL:

Yes, I think possibly some good suggestions may be evolved through such an investigation. But the best suggestion made in the course of this debate, and it has been emphasized over and over again, is that the board should be quietly but very definitely relieved of the position which it now holds, and another board, possibly of five members, put in its place.

Hon. CHARLES A. DUNNING (Minister of Railways and Canals): Mr. Speaker, I regard the Canada Grain Act as a unique piece of legislation. Nothing akin to it is to be found on the statute books of any other country, so far as I know. It has been evolved 78594-734

gradually out of a desire on the part of succeeding parliaments, without regard to which party was in power, to surround the marketing of the major raw product of this country with email safeguards as will ensure fair treatment of the producer by those engaged in the business connected with his product or in the transportation of it.

Legislation of this character is invariably difficult to administer, for the reason that in a measure it deprives men of the right to make the usual contractual relations with each other in connection with the ordinary buying and selling of commodities. I think it is correct to say that since there was first the Manitoba Grain Act-as it was originally called-down until to-day succeeding governments of whatever party have adopted the position of trying to find out so far as possible what the people of the three provinces particularly concerned thought should be done with respect to this act or to any amendment of it as the case might be. I think too that it may well be said that every government has shown a willingness to respond to the united judgment of the representatives of those three provinces with respect to the development of the act from time to time.

The act does show historically a development resulting from careful thought and careful study by the farmers themselves who are primarily affected, and by their representatives in this house, to whatever party they might belong. Furthermore, the act bears upon its face an historical record of the effect of investigations by, not one but by at least five royal commissions appointed either by federal authority or by the authority of one of the provinces primarily concerned. I had the privilege of serving as a member of one of those royal commissions some years ago. It was also my duty as an agent for my fellow-farmers to handle a great deal of grain during a considerable period of years, and I do deprecate in the very strongest terms the use of extreme statements and arguments which overshoot the mark, in attempting to secure redress in connection with a matter of this kind. Particularly do I deprecate the use oi figures such as those advanced by the hon. member for Kindersley (Mr. Carmichael) a few moments ago, when he stated in the plainest of terms, on the basis of some hypothetical calculation which he made, that, given a proper grading system, it would have been possible for the farmers of western Canada to have received $175,000,000 more for the 1928 crop than they did receive.

Topic:   GRADING OF GRAIN
Subtopic:   WHEAT-INSPECTION, SHIPMENT AND PROTEIN CONTENT-REFERENCE TO COMMITTEE ON AGRICULTURE
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PRO

Archibald M. Carmichael

Progressive

Mr. CARMICHAEL:

I did not put it that way.

Grading of Grant-Mr. Dunning

Topic:   GRADING OF GRAIN
Subtopic:   WHEAT-INSPECTION, SHIPMENT AND PROTEIN CONTENT-REFERENCE TO COMMITTEE ON AGRICULTURE
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LIB

Charles Avery Dunning (Minister of Railways and Canals)

Liberal

Mr. DUNNING:

My hon. friend in answering a question made it clear that it was his intention to convey that impression. However, if he wishes to correct it I am quite prepared to let him do so.

Topic:   GRADING OF GRAIN
Subtopic:   WHEAT-INSPECTION, SHIPMENT AND PROTEIN CONTENT-REFERENCE TO COMMITTEE ON AGRICULTURE
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PRO

Archibald M. Carmichael

Progressive

Mr. CARMICHAEL:

I took the average

price of the four year average and showed what the total amount would be from the 1928 crop, deducting the price of the 1928 crop from that average.

Topic:   GRADING OF GRAIN
Subtopic:   WHEAT-INSPECTION, SHIPMENT AND PROTEIN CONTENT-REFERENCE TO COMMITTEE ON AGRICULTURE
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LIB

Charles Avery Dunning (Minister of Railways and Canals)

Liberal

Mr. DUNNING:

Yes; but my hon. friend said in reply to a question that in his opinion the difference was due to two things and two things only-unscientific grading and faulty administration of the grain act. Let me say to him that I have a great deal more faith in the western Canada pools than to believe that they would permit for a moment to exist a situation which if removed would allow them to get $175,000,000 more for the farmers of the west.

Topic:   GRADING OF GRAIN
Subtopic:   WHEAT-INSPECTION, SHIPMENT AND PROTEIN CONTENT-REFERENCE TO COMMITTEE ON AGRICULTURE
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PRO

Archibald M. Carmichael

Progressive

Mr. CARMICHAEL:

That is why we are doing so much talking.

Topic:   GRADING OF GRAIN
Subtopic:   WHEAT-INSPECTION, SHIPMENT AND PROTEIN CONTENT-REFERENCE TO COMMITTEE ON AGRICULTURE
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LIB

Charles Avery Dunning (Minister of Railways and Canals)

Liberal

Mr. DUNNING:

My hon. friend is not

speaking for the pools any more than I am, and I am satisfied of this: Having sold personally, or under my personal direction, more grain; for the western farmers than any organization outside the -pool, I want to assure the hon. gentleman that if there is any means of getting any such sum for the farmers of the west it is quite within the power of the wheat pool, and within the power of any other large organization controlling such a volume of grain, to get that sum in spite of any grading system. And the pool officers would be the first to confirm this statement. Why? If it is possible to get any such spread as that it is not only within the power of the pool to get it, but I am sure they would do so in a moment. They can ship that grain over, in spite of any grading system, and dispose of it in sample cargoes, without obtaining a certificate from the Board of Grain Commissioners. Normally it does not pay to do so-and why? Because there is in fact no such wastage as that depicted by my h-on. friend. That there is wastage and loss no one denies; I would be the last to deny it. In connection with varying types of damage to which the western crops are subject from time to time; with the necessary variation in standard samples from year to year; with slips in administration; with the ever present desire of -the grain trade to make as -much as they can: with all these things to contend with, undoubtedly there are, and always have been from the very inception

of the grain act, losses to farmers individually. But to take an average set of conditions over four years, disregarding, as my hon friend did, average world prices for the same four years, and merely to rest a case on the argument that we should have as much this year as our average of last year-[DOT]

Topic:   GRADING OF GRAIN
Subtopic:   WHEAT-INSPECTION, SHIPMENT AND PROTEIN CONTENT-REFERENCE TO COMMITTEE ON AGRICULTURE
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CON

Richard Bedford Bennett (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. BENNETT:

No, no; he did not say

that.

Topic:   GRADING OF GRAIN
Subtopic:   WHEAT-INSPECTION, SHIPMENT AND PROTEIN CONTENT-REFERENCE TO COMMITTEE ON AGRICULTURE
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March 21, 1929