Summary of stakeholder feedback – Licensing feed mills consultation

The Canadian Grain Commission held a consultation from February 9 to April 9, 2015, on a proposal to license feed mills in western Canada.

43 formal submissions were received from a diverse range of stakeholders including 53 feed mills, commodity and producer organizations. The discussion paper was accessed over 1400 times on the Canadian Grain Commission web site during the consultation period.

The Canadian Grain Commission will report the feedback received to the Minister of Agriculture and Agri-Food. All stakeholder comments will be taken into consideration during the next steps in this process, which will include a second consultation on a more focused proposal for licensing feed mills.

We thank all stakeholders who submitted their comments to us.

Major feedback themes

  1. Purpose and benefits of licensing
    • The majority of respondents (with the exception of some commercial feed mills) support licensing large commercial feed mills, recognizing small and on-farm feed mills operate differently than large commercial mills.
    • Grain sector stakeholders feel that licensing feed mills would create more stability in the feed sector and give grain producers confidence when they grow and deliver their grain to feed mills.
    • Payment protection is seen as an advantage by some feed mills in encouraging producers to deliver grain to them.
    • Some stakeholders advocate that all businesses that purchase grain (on or off-farm) and/or handle grain as part of their business model be licensed. This would foster fairness and create a level playing field.
  2. Potential impacts on feed sector
    • Many commercial feed mills feel licensing feed mills is unnecessary explaining that sufficient measures are already in place to ensure producer payment. Examples include long-term relationships between feed mills and grain producers which already instill confidence in grain producers and help build on repeat business; and a history of feed mills paying grain producers in both lean and abundant times.
    • Some respondents feel introducing additional fees and reporting requirements to feed mills would put further strain on an industry operating with tight profit margins, and that operational barriers should not be created for the sector.
    • Some respondents question why additional licensing and compliance requirements are being considered when feed mills are currently licensed by the Canadian Food Inspection Agency.
  3. Potential impacts on producers
    • The Canadian Grain Commission repeatedly hears that the costs of licensing would be passed on to grain producers.
    • Some stakeholders indicate that some feed mills may choose not to purchase grain directly from producers to avoid licensing and buy from grain companies or brokers instead.
    • Some respondents feel that producer payment protection would further enhance the existing system providing increased stability in all transactions and commercial relationships.
  4. Recommended approaches to licensing
    • A few submissions suggest the Canadian Grain Commission perform a comprehensive cost-benefit analysis to ascertain that the benefits of licensing feed mills outweigh the costs to individual entities and the industry.
    • Groups that support licensing feed mills want to ensure that including feed mills in the current Payment Protection Program would not negatively affect that program.
    • Stakeholders suggest that the producer compensation fund would be beneficial to this and future licensing initiatives.
    • Some respondents express concern that Bill C-48 may affect licensing feed mills and suggested that the Canadian Grain Commission ensure that licensing efforts are not weakened by the Bill.

Next steps

  1. The Canadian Grain Commission is currently reviewing the results of this engagement and will consider feedback received when developing a formal proposal to license feed mills.
  2. The Canadian Grain Commission will develop a proposal with specific details regarding licensing thresholds, licensing and compliance requirements and costs and benefits.
  3. Stakeholders will have the opportunity to comment on the detailed proposal through further consultations in the coming months.