November 14, 1940 (19th Parliament, 2nd Session)

LIB

James Garfield Gardiner (Minister of National War Services; Minister of Agriculture)

Liberal

Mr. GARDINER:

Oh, yes; they will be
tabled as soon as they are in shape for tabling.
What about wheat? The position has been stated quite fairly by both the leader of the Cooperative Commonwealth Federation and the leader of the Social Credit party in so far as crop returns and storage are concerned. I did not go to Britain with authority to make an agreement on wheat. The duty of selling wheat has been entrusted by this house to a wheat board. It is not the duty of any minister to market wheat, but that of the wheat board which under the act reports to the Minister of Trade and Commerce.
Both the Minister of Trade and Commerce and the chairman of the wheat board asked me to discuss wheat and instructed their representatives in Britain to facilitate the discussions in every way possible. I wish here to state that I and those with me appreciated the assistance received from the very competent staffs of the Department of Trade and Commerce and the Department of External Affairs, including the high commissioner. In so far as wheat was concerned the assistance of Mr. Biddulph was indispensable. No official could know his job better or carry it out with greater courtesy and efficiency.
To illustrate Canada's wheat position to Britain I used certain figures, as follows:
Million
bushels
Wheat carried forward from previous years into 1940-41 and now in
storage 282
Canada's crop in the year 1939-40... 561
Stocks in sight to dispose of at August
1st, 1940 843
Canada will probably consume in
1940-41 130
Canada therefore has for sale 713
In the 14 years before the war, Canada sold to the United Kingdom
an annual average of 90
Canada exported to the United Kingdom in calendar year 1939 132
Canada exported last year to all countries, except the United Kingdom which it is now open to her
to sell 25
Canada exported before the war to countries now blockaded, an annual average of 35
The wheat carried forward from previous years covers the amount in the elevators of Canada at August 1, 1940, because I was dealing with the storage situation.
The United Kingdom imported 230 million bushels of wheat in the year 1938-39. It appeared, therefore, that Canada could meet
the entire demands of the United Kingdom for wheat for the next three years out of her present stocks of 843 million bushels. Canada realized, of course- these were the representations made-that the United Kingdom would want to buy wheat also from countries other than Canada. But it appeared that in recent months about seventy per cent of the United Kingdom purchases had been of Canadian origin, and I suggested that the United Kingdom might think it desirable to maintain this percentage. On this basis it appeared that the United Kingdom would want to take about 160 million bushels of wheat a year from Canada.
With regard to the future, I examined the prospects first on the demand and then on the supply side. On the demand side, assuming that the blockade would not be lifted for two more years, Canada expected to be able to dispose of 160 million bushels a year to the United Kingdom, and to raise the consumption within Canada for food and feed from 130 million to 160 million bushels a year. During this two year period it thus would be possible for Canada to dispose of 640 million bushels at home and to the United Kingdom. In addition, Canada expected that after the blockade was lifted it would be possible for her to dispose of 160 million bushels a year to countries now blockaded, or say 480 million bushels over a three year period. Thus during the next five years, assuming two years of blockade and three years of offensive warfare or peace, it should be possible for Canada to dispose of the following quantities of wheat:
Million
To the United Kingdom: bushels
5 years at 160 million bushels
a year 800
By internal consumption:
5 years at 160 million bushels
a year 800
To countries now blockaded:
3 years at 160 million bushels
a year 480
Total 2,080
On the supply side, Canada could expect to produce on an average 380 million bushels of wheat a year. That is her average for the last fourteen years and more than her average for the last five years, including the last two crops. Her total production in five years thus would amount to 1,900 million bushels. To this should be added the 280 million bushels carried over into 1940-41 from previous years, making a total quantity of 2,180 million bushels which it would be necesary for Canada to dispose of in the five year period.
It appeared, therefore, according to the above figures that Canada would have 2,180 million bushels of wheat to sell in the five
The Address-Mr. Gardiner

year period, and that during the same period she probably would be able to market 2,080 million bushels, leaving a carry-over at the end of that time of only 100 million bushels. Moreover, if Canada continued to be able to sell 30 million bushels a year to those countries outside Europe which were not being blockaded, instead of there being a surplus of 100 million bushels at the end of the five year period the demand for Canadian wheat would be 50 million bushels greater than the supply.
I did not consider, therefore, that Canadian wheat producers need be pessimistic, but may I say again that there is nothing in these figures which should induce Canadian wheat growers to increase their acreage this year. As a matter of fact there is very much in them upon which to ask farmers at least to go back to the acreage they had in the year previous to last year, which was 2,000,000 acres lower than the land sowed to grain last year.
Canada could supply Britain's needs and did not anticipate that unsold stocks would grow to excessive amounts. The difficulty, however, was that of financing the quantities of wheat which would have to be carried. About 800 million bushels of wheat would need to be financed, of which roughly half would be financed for two years at a cost of about 80 cents a bushel and the other half for one year at a cost of some 75 cents a bushel, if the present arrangement is continued. This would mean that the Canadian government would require to put out about $320 million on the two year arrangement and about $300 million on the one year arrangement, making a total of S620 million. The dominion government is obliged to pay the farmer any additional amounts received for the wheat. It is generally admitted that 70 cents advance at Fort William, which nets the farmer about 50 cents a bushel, does not cover his total costs of production and therefore does not maintain him as a contented producer. If he is to receive more money, it -must come from the sale price of wheat, or from the taxpayers of Canada, or from both.
Those were the representations made. We made it plain to the British government that we were there not to discuss an agreement but to get their opinions with regard to the wheat situation. I have received those opinions as a result of the representations made through officials of the department concerned, and I have presented them to the Minister of Trade and Commerce (Mr. MacKinnon) to be given consideration under his direction by the government of Canada. When

he is in a position to make the pronouncement he desires to make with regard to the policy to be followed as a result of them, he will make the announcement to the house.
I believe I have more than exhausted my time. I am sorry I had not time to deal with the situation as I saw it in Great Britain.

Topic:   VALUE OF EXPORTS OF CERTAIN CANADIAN AGRICULTURAL PRODUCTS AND FISH TO THE UNITED KINGDOM
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