May 17, 1955 (22nd Parliament, 2nd Session)


Hazen Robert Argue

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

Mr. H. R. Argue (Assiniboia):

Mr. Speaker, I rise at this time to express grave concern over the extremely small final payment for wheat announced yesterday and grave concern for the whole future of the wheat-producing area of western Canada. Ever since 1945 the price of wheat has been relatively stable. The wheat board has paid the western wheat producers a final price for each crop year since 1945 of something in excess of $1.80 a bushel, and usually about $1.83 a bushel. But with the final payment announced yesterday, for the first time since 1945 the price of wheat to the producer has fallen far below $1.80 a bushel for No. 1 northern basis Fort William.
With the final payment announced yesterday the total price for wheat amounts to only $1.56 a bushel. This more than 25 cents per bushel drop in the price of wheat to the wheat producer is causing grave hardship 50433-242J
in western Canada, is meaning a tremendous loss in purchasing power by western farmers and, as we all can see, is reflected in widespread unemployment and in a recession in many of the industrial areas of Canada.
Since 1945 the policy of the wheat board and the government in reference to wheat has been approximately as follows. In the beginning of each crop year an initial price of $1.40 per bushel was paid; the following February an interim payment of 20 cents per bushel was made; and in December of the same crop year a final payment was made, usually between 20 cents and 25 cents a bushel. Now not only have the payments fallen off drastically but the payment is made at a later and later date. In the 1953-54 crop year there was a delay in the making of the interim payment from February, the usual time, until December and a delay in the making of the final payment from December until May or June of this year when the farmers are likely to receive their cheques. The interim payment for the 1953 crop was reduced from 20 cents a bushel to 10 cents a bushel and, as I have said, the final payment was reduced from an average of 20 to 25 cents a bushel to an effective final payment of 6-2 cents per bushel.
This same thing can be illustrated in another way. When the 1950-51 wheat pool was wound up and the final payment was made there was a surplus on hand of $106 million. For the 1951 crop there was a surplus of $115 million, and for the 1952 crop there was a surplus of $123 million. This time the surplus, which has always averaged more than $100 million in the period I have referred to, is reduced to just over $25 million. The reduction of $80 to $100 million in the surplus representing money that cannot be made available to farmers as a final payment is not only very serious as far as the prairie provinces are concerned but is very serious indeed as far as the whole Canadian economy is concerned.
The drop in the price of wheat is reflected in a drop in farm net income. I have in my hand the latest figures for farm net income. They show that during the period from 1951 to 1954 there was a drop in farm net income of 48 per cent or from $2,154 million in 1951 to $1,125 million in 1954. A very substantial part of the 48 per cent drop in farm net income is directly attributable to the falling off in the price of wheat and the

reduction of wheat board payments. Let no one go away with the impression that I am opposed to or critical of the wheat board method of marketing grain. We continue as always to support the wheat board method of marketing grain, and even though the price of wheat should fall even lower the wheat board method will remain the best possible method because it gives to each producer of wheat in the prairie provinces exactly the same price as his neighbour receives for the one-year period. The wheat board cannot guard against all severe fluctuations in the price of wheat but it can and does give to the farmers within a 12-month period the same price for wheat, and that in itself is a very important and worthwhile accomplishment.
I believe the Canadian government should establish a sound price for wheat based on the principles of parity. I have mentioned in the past how the government is behind other nations of the world in so many fields, and I regret that I am able to point out this afternoon that the farmers of Canada are guaranteed the lowest price for wheat of wheat producers in any wheat producing country in the free world. I hold in my hand a table of guaranteed prices for the various countries taken from the Alberta Wheat Pool Budget of March 25, 1955. Here is how the prices go:
Guaranteed price per bushel of
Country wheat
Turkey $3.21
France 3.04
Tunisia 3.03
Germany 2.83
Spain 2.81
Argentina 2.80
Japan 2.61
Greece 2.40
Belgium 2.29
United Kingdom 2.20
Sweden 2.10
United States 2.06
Australia 1.57
Syria 1.54
Canada 1.44
These prices are expressed in terms of United States currency. The Canadian wheat producers get from their government the worst treatment, in the way of a guaranteed floor price, of the wheat producers in any important wheat producing country in the free world. It is for that reason I say our farm organizations are justified in asking for an adequate support price for wheat, and in asking that parity prices be established.
From time to time we have asked the Minister of Trade and Commerce (Mr. Howe) what was happening to the Canadian export market for wheat. Time and time again the minister has replied that all was well, that

our markets were holding up well. As recently as last Friday the minister, in reply to a question asked by the hon. member for Humboldt-Melfort (Mr. Bryson) as to the drop in Canadian export sales of wheat, had this to say, as reported at page 3732 of Hansard for May 13, 1955:
We believe that our policy of selling for dollars is the proper policy for Canada. I know of no reason why we should sacrifice wheat which is the property of the producers of western Canada for the sake of the odd few sales we might get if we accepted a different currency.
On March 28 the minister, in reply to a question by the hon. member for Prince Albert (Mr. Diefenbaker), had this to say, as reported at page 2429 of Hansard for that date:
I think it is encouraging to find that, in spite of the offers of wheat made by the United States, Canada is selling more wheat than the United States has succeeded in disposing of by the various methods it has adopted.
Apparently not until yesterday did the minister realize what was happening in the world wheat export picture. What has been happening has been this. Canada's percentage of the sales of export wheat has been dropping every year since 1952-1953, from 43-2 per cent until now when it is running currently at 33-4 per cent. Even though there has been a substantial increase in the world trade in wheat, Canada has obtained practically none of that increase. The United States has obtained an increase of 64 million bushels to date in the current period; the Argentine, 14 million bushels; Australia, 12 million bushels, and Canada the very small increase of 2 million bushels.
It is clear from those figures that our government is going to have to adopt a different technique in the exporting of Canadian wheat if we are to hold our position in the export markets of the world. I suggest that position can be held only if the government moves away from its present position of demanding dollars and cash in return for the sale of every single bushel of wheat. Instead of criticizing the United States government for having made wheat available to countries that are short of cash, and short of hard currency I suggest the Canadian government should be adopting a similar policy which would result in the underdeveloped countries obtaining increased quantities of wheat, and which would obtain for Canada its traditional share of the world market for wheat. The government may not realize the very serious condition of agriculture in Canada, particularly in western Canada at the moment.
The Western Producer, published by the wheat pool organization, came to my desk yesterday. It is dated Thursday, May 12,

and in an editorial entitled, "Are Farmer Organizations on Their Toes?" in speaking about the dominion-provincial conference, I read the following:
In the circumstances, is it not highly significant that the dominion-provincial conference should be seized by the problem of unemployment which, bad though it may be, is no more than a symptom of the real disease, the core of which is the decline in agriculture.
And nothing is being proposed by the government today which will bring agriculture out of the deep depression it is now in, in western Canada, and which in turn would help to bring Canada out of the current recession.
Speaking about the disposal of agricultural surpluses, the Western Producer in the same issue, in an article entitled "The Surplus Problem", has this to say:
Agriculture today in Canada and elsewhere is confronted with many grave problems. Among the most serious, we suggest, is that posed by the inability to distribute surpluses and give farmers the green light to produce to the optimum in the knowledge that they will be assured of ready markets at fair prices. At a time when everybody admits that the food is needed and that a prosperous agriculture is the foundation for general prosperity this is not an unreasonable objective. On the contrary, to permit agriculture to slide into a depression might easily drag the whole economy down and thus gravely imperil the position of the whole non-communist world.
It is time that a concentrated effort by organized agriculture should be made to urge our own government to give top billing to consideration of ways and means for surplus food disposal.
I suggest to the government that instead of criticizing the action taken by the United States to get rid of their surplus agricultural products, the Canadian government should be co-operating with the government of that country, and should have similar policies to get rid of current agricultural surpluses in Canada.
Yesterday in his statement the Minister of Trade and Commerce pointed out how successful the United States has been in its current drive to make wheat available to soft currency countries. He pointed out that the government of the United States under this policy has made available 60 million bushels of wheat at a cost of about $200 million. Then, as reported at page 3782 of Hansard, he went on to say:
The purpose behind the surplus disposal efforts of the United States is to increase consumption in areas that cannot afford to buy wheat. Canada has no quarrel with that principle.
In other words, according to that statement by the Minister of Trade and Commerce, American policy does not affect our commercial markets for wheat but, in the words of the minister, increases consumption in areas that cannot afford to buy wheat.
That is what the C.C.F. has been advocating for many years, that our surplus agricultural products should be used to feed the hungry of the world, and that the government should not follow a policy of attempting to restrict production by enforcing stop-loss floor prices which ruin the farmers, or a policy of saying, "We will sell for cash, and for cash only, even if we lose a very substantial share of the international market for wheat".
The group of which I am a member believe in the principle of parity prices. We do not believe that parity prices are something that can be described as pie in the sky. We do not think that parity prices are something that is impossible of accomplishment. We think that parity prices, in the interests of all Canada, must be accomplished and must be provided. Until agriculture is assured of reasonable treatment, reasonable prices and a continuing steady share of the national income it will face recurring periods of drops in income. Farm income has dropped. 48 per cent in three years.
In order to overcome this recurring recession in agriculture, with its evil effects on the whole Canadian economy, the C.C.F. stand four-square behind the principle of parity prices. Parity to us is equity and justice. We do not support, as some other parties in this house do, notably the Social Credit party, a certain percentage of parity for any commodity which is less than 100 per cent, no matter by what formula it may be arrived at.

Topic:   FINAL PAYMENT, 1953-54
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