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Canada Wheat Board case proceeds as contracts offered

WINNIPEG, Manitoba - A court challenge of the law ending the Canadian Wheat Board's marketing monopoly proceeded in a Manitoba court on Friday, while the government insisted it was full steam ahead on its open market plans and Viterra Inc began offering forward grain contracts.

The farmer directors of the Canadian Wheat Board who had launched the court challenge along with the CWB, pursued their case as individuals, even though the board is now under federal control and has pulled out of the case.

Legislation ending the CWB's 68-year-old marketing monopoly on sales of western wheat and barley became law late Thursday, allowing Ottawa to take control of the board from farmers who oppose the Conservative government's plans to create an open market.

The farmer directors continued to be represented by their lawyer in the court hearing.

Agriculture Minister Gerry Ritz told a news conference in Saskatchewan that the farmer directors' roles ceased to exist with the passage of the bill. "They're now on winter vacation," he said.

The government legislation provides for the removal of the eight farmer-elected directors, leaving the CWB in the hands of five government-controlled appointees.

Ritz issued a statement saying the Conservative government was working on "an orderly transition to market freedom which includes a viable, voluntary CWB."

"As of today, western wheat and barley farmers now have the freedom to forward contract for the delivery of wheat and barley to the Canadian Wheat Board or the buyer of their choice for delivery after August 1, 2012," the statement said.

Despite the legal uncertainty, grain handler Viterra started offering forward contracts on wheat, durum wheat and barley.

"Starting today, Viterra is pleased to offer bids to western Canadian wheat, durum and barley producers," said Chief Executive Mayo Schmidt.

CWB President Ian White also issued a statement saying the organization would still be there and would soon be announcing new programs for the next crop year.

"Amid all the change, one thing remains the same: the CWB will market farmers' grain. We will work to achieve the best prices for farmers and superior service for customers in Canada and around the world," White said.

On Wednesday, the CWB and its farmer directors had filed papers in the Manitoba court asking it to strike down the law on the grounds that the old law required a farmer vote before changing the marketing monopoly. A Federal Court last week had said Ritz had breached the law in not holding a farmer's vote, but it did not strike the law down, nor was it asked to do so.

The Friday court hearing in Winnipeg was on a motion asking the court to suspend implementation of the law until a decision is reached on whether to strike it down.

The motion asks that the suspension be retroactive to the moment the bill was signed into law. If that is granted, then the farmer directors, including Chairman Allen Oberg, would in theory be reinstated.

If the suspension is granted, however, Ritz said the government would still proceed with plans for the revamped CWB.

(The case is before the Court of Queen's Bench of Manitoba, Winnipeg Centre, Court File No CI 11-01-75257. It is between Canadian Wheat Board, Allen Oberg, Rod Flaman, Cam Goff, Kyle Korneychuk, John Sandborn, Bill Toews, Stewart Wells and Bill Woods; and Attorney General of Canada.)
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