April 6, 1943

PUBLIC ACCOUNTS

MOTION FOB CONCURRENCE IN SECOND REPORT


Mr. W. A. FRASER (Northumberland, Ont.) presented the second report of the standing committee on public accounts, and moved that the report be concurred in.


NAT

Gordon Graydon (Leader of the Official Opposition)

National Government

Mr. GORDON GRAYDON (Leader of the Opposition):

Mr. Speaker, in view of the fact that the customary notice has not been given of this motion for concurrence I would respectfully say that we are not prepared to give approval at the moment.

Motion stands.

Topic:   PUBLIC ACCOUNTS
Subtopic:   MOTION FOB CONCURRENCE IN SECOND REPORT
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INTERNATIONAL CURRENCY

STABILIZATION OF POST-WAR CURRENCIES ON A BASIS OF GOLD


On the orders of the day:


SC

John Horne Blackmore

Social Credit

Mr. J. H. BLACKMORE (Lethbridge):

I desire to direct a question to the Prime Minister based upon a press dispatch from Washington, dated April 5. First, is Canada one of the thirty-four nations to whom, according to United States treasury secretary Henry Mor-genthau, has been communicated a broad plan for international stabilization of world currencies after the war on a basis of gold? Second, if so, when may this house expect the Prime Minister to submit this plan to parliament for discussion?

Topic:   INTERNATIONAL CURRENCY
Subtopic:   STABILIZATION OF POST-WAR CURRENCIES ON A BASIS OF GOLD
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LIB

James Layton Ralston (Minister of National Defence)

Liberal

Hon. J. L. RALSTON (Minister of National Defence):

The Prime Minister is unable to be present, but I will bring this matter to his attention. The question can be treated as notice.

Coarse Grains

Topic:   INTERNATIONAL CURRENCY
Subtopic:   STABILIZATION OF POST-WAR CURRENCIES ON A BASIS OF GOLD
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GRAIN MARKETING POLICY

ANNOUNCEMENT WITH RESPECT TO COARSE GRAINS


On the orders of the day: Hon. J. A. MaeKINNON (Minister of Trade and Commerce): Mr. Speaker, on Tuesday last I intimated to the house that I expected to be able to make a statement shortly with respect to the coarse grain situation. This matter has been fully considered and I wish to make a statement outlining the government's policy. Members of this house will recall that the government's programme for the 1942-43 crop year was a programme designed to stimulate the production of coarse grains and to remove any fear of a decline, in the. prices of these grains as a result of increased production. Minimum basic prices of forty-five cents for oats and sixty cent} for barley were guaranteed, with the Canadian wheat board instructed to purchase in the event that the market declined to these floor prices. At times last autumn the board had to purchase both oats and barley in order to prevent a further decline in prices, and it was only because of the development of a heavy feed grain demand from the United States and difficulty in making delivery that this situation has not continued. It was clearly stated last year that the ceiling prices of 51i cents on oats and 64| cents on barley would be maintained, and this part of the coarse grains programme has effectively contributed to the maintenance of our live stock programme. Since early in February, Winnipeg prices for oats and barley have been at or close to ceiling levels. In the meantime, United States grain markets have been advancing, and the difference between our prices and United States prices has widened considerably. The government were naturally concerned about finding a means to enable the western farmer to benefit from the United States market, and at the same time to maintain those price controls in the domestic market which are a part of national policy. Another problem arising from these circumstances which had to be considered by the government was the fact that exporters of Canadian feed grains were placed in a position to obtain more than a normal margin, had export permits been freely issued. The government is naturally concerned that the full American price less transportation, duty, and forwarding costs be returned to the western producer. The price ceilings on coarse grains in the Winnipeg market were imposed as part of our national price control policy, and were based on the highest prices recorded during the base period. With the price control policy in effect, it is important that domestic feeders who purchase coarse grains will be able to keep their feed costs in proper line with the prices received for the bacon, beef, dairy and poultry products which they are producing and upon which there are various ceiling and contract prices, in order to meet the needs of the United Kingdom and our own domestic food requirements. Without the ceiling protection, feed prices could and might rise to a level which would prejudice the effective prosecution of our extensive and vital live stock programme. It is of the greatest importance that any action taken at this time should not disturb the basis of live stock production. It is the considered view of the government, therefore, that the ceilings on oats and barley in the Winnipeg market must be retained. To the extent that coarse grains can be exported at prices above our ceiling levels, the government have sought to develop a workable basis which would give producers who sell coarse grains the advantage of any higher export prices on that portion of the total coarse grain marketings which go into export. With this principle in mind the government are instructing the Canadian wheat board to charge an equalization fee on the issuance of export permits to exporters of Canadian oats and barley. The equalization fee will, as nearly as possible, represent the difference between Canadian prices and United States prices, less transportation costs, United States import duty and forwarding costs, and with allowance for exchange. The equalization fee will not be fixed but will vary in accordance with the United States prices as compared with Canadian prices. The Canadian wheat board will set up two special funds into which equalization fees for oats and barley, respectively, will be paid. These funds, in turn, will be distributed at the end of the crop year on a pro rata basis to the growers who have delivered these grains since March 31. Naturally, the amount in either of these funds for distribution to farmers will depend upon the future margin between Canadian and United States prices and upon the volume of exports. By the method I have just outlined, the growers who sell their coarse grains will receive, in effect, a combined price, which reflects the ceiling price on that portion of their sales which has been disposed of in the domestic market, and the export price on that portion which has been disposed of in the export market. Coarse Grains



This policy will, I trust, commend itself both to the producers and the domestic buyers of coarse grains as being fair. It assures the continuation of Canada's food production programme in so far as meat, dairy and poultry products are concerned. In regard to export markets the government are determined that the full advantage of these markets will be shared by producers marketing oats and barley on any surplus of these grains available for export, after the domestic requirements needed to maintain a full live stock production are adequately met. The clear object of these arrangements in regard to oats and barley is to ensure that the full export returns for these grains should go to the producer and should not accrue to the exporter or to the purchaser abroad. The situation in respect of rye is different. Out of a western crop of 23 million bushels, only about one million bushels are disposed of commercially within Canada, and a considerable part of that is for uses for which other grains are equally good. The government's object can therefore be achieved most easily in the case of rye, having regard particularly to economy and facility of administration, by permitting the price of rye to conform to export prices rather than by adopting the system of an equalization fee for the sake of a small and relatively nonessential portion of the crop. I am, therefore, authorized on behalf of my colleague, the Minister of Finance, to announce that he has discussed this matter with the wartime prices and trade board and that the ceiling on rye will be removed as soon as the Canadian wheat board has completed a survey of the market po*sition in that grain. At the present time there is very little difference between rye prices in Canada and the United States after taking into account transportation costs, forwarding costs, exchange and duty. On this basis it would not appear that there would be any substantial rise in Canadian prices of rye. If a substantial rise in price does take place, however, there will of course be a corresponding increase in the cost of rye to Canadian consumers. As already explained, the quantity of rye disposed of commercially within Canada is very small, and it is clear that most of what is consumed could be readily replaced by other grains. There may be a few cases of essential use, however, and the Minister of Finance has directed the wartime prices and trade board to make a thorough investigation of any claims that arise and to make appropriate arrangements for absorbing part or all of these increased costs where it can be shown that the consumption of this grain is essential.


CCF

Thomas Clement (Tommy) Douglas

Co-operative Commonwealth Federation (C.C.F.)

Mr. DOUGLAS (Weyburn):

The minister mentioned only oats and barley. Will this apply to flax? Will the minister explain also how the money collected by means of equalization fees will be passed back to the producers of coarse grains?

Topic:   GRAIN MARKETING POLICY
Subtopic:   ANNOUNCEMENT WITH RESPECT TO COARSE GRAINS
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LIB

James Angus MacKinnon (Minister of Trade and Commerce)

Liberal

Mr. MacKINNON (Edmonton West):

The statement does not refer to flax.

Topic:   GRAIN MARKETING POLICY
Subtopic:   ANNOUNCEMENT WITH RESPECT TO COARSE GRAINS
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CCF

Thomas Clement (Tommy) Douglas

Co-operative Commonwealth Federation (C.C.F.)

Mr. DOUGLAS (Weyburn):

It is being exported.

Topic:   GRAIN MARKETING POLICY
Subtopic:   ANNOUNCEMENT WITH RESPECT TO COARSE GRAINS
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LIB

James Angus MacKinnon (Minister of Trade and Commerce)

Liberal

Mr. MacKINNON (Edmonton West):

Yes. The money will be returned to the producers according to their shipments. This will be handled through the wheat board.

Topic:   GRAIN MARKETING POLICY
Subtopic:   ANNOUNCEMENT WITH RESPECT TO COARSE GRAINS
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CCF

Major James William Coldwell

Co-operative Commonwealth Federation (C.C.F.)

Mr. COLDWELL:

Proportionately?

Topic:   GRAIN MARKETING POLICY
Subtopic:   ANNOUNCEMENT WITH RESPECT TO COARSE GRAINS
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LIB

James Angus MacKinnon (Minister of Trade and Commerce)

Liberal

Mr. MacKINNON (Edmonton West):

Proportionately, according to their shipments.

Topic:   GRAIN MARKETING POLICY
Subtopic:   ANNOUNCEMENT WITH RESPECT TO COARSE GRAINS
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PC

Mark Cecil Senn

Progressive Conservative

Mr. SENN:

May I ask for the sake of clarity whether these regulations apply to grain grown in eastern C.anada or only to grain that comes under the Canadian wheat board?

Topic:   GRAIN MARKETING POLICY
Subtopic:   ANNOUNCEMENT WITH RESPECT TO COARSE GRAINS
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April 6, 1943