Viterra-Bunge merger means less money for Sask. farmers: Grain Growers

A major agricultural association wants the government to rethink its approval of the Viterra-Bunge merger.

The federal government gave the move the green light earlier this week, but Kyle Larkin, executive director of the Grain Growers of Canada, said he expects the deal will hurt farmers over the long term.

Read More:

• Concerns abound on the prairies over Viterra-Bunge merger approval
• Ag groups oppose Viterra Bunge merger, Scott Moe ‘watching very closely’
• Competition Bureau raises concerns over Bunge-Viterra deal

While the deal did come with conditions – such as divesting six grain elevators in Western Canada and a $520 million investment commitment from Bunge – Larkin said the conditions don’t go far enough to address the impact the move will have on competition.

“What we were looking for was for the new company to have to divest their 25 per cent stake in G3,” he said.

“That 25 per cent stake in G3 by the combined new Bunge would have a serious impact on the prices that producers get when they are selling their crop.”

Larkin said he expects the merger will cost farmers $770 million annually.

Transport Canada gave approval for the merger on Tuesday along with a list of conditions. (CJME file photo)

“Which means that producers across Saskatchewan and across the country, to be frank, will be losing thousands of dollars a year in lower prices for their crop,” he said.

Larkin added that he is also worried about its impact on the planned canola crushing facility in Regina, because Bunge already has canola crushing assets not too far from where the project is being proposed.

“The question you have to ask – and the question that I would ask the new company – is will they truly build another canola crushing plant so close to assets that they already have?” Larkin said.

“For your average private company, the answer would be no. That wouldn’t make sense.”

Larkin said that if the project doesn’t go ahead, it would mean less money for canola producers in Saskatchewan.

On top of that, he said the weakened competition in the market because of the merger will mean producers will see less cash in their pockets.

“What that means for Saskatchewan producers, in general, is they’re going to be paid less, not only for their canola but also other crops such as such as wheat and barley,” Larkin said.

“It’s going to have major impacts on the livelihoods of farmers in the tens of thousands of dollars for individual producers.”

Pointing to the conditions of the merger, and specifically the divestment of six grain elevators, Larkin says its not enough.

“That’s peanuts in the larger conversation here,” he said.

“Them having to divest six grain elevators of their choosing – that’s the information we have right now – is peanuts in the wider conversation of things,” he said.

“While that may lessen a bit the impact of this merger, I am certain that this is still going to have impacts on the livelihoods of producers and the lessened competition across the prairies.”

Larkin said his organization is extremely disappointed with the final decision from the federal government and is urging Ottawa to reconsider.

In a statement from the Government of Saskatchewan, it said, “It is critical for Canadian producers, Viterra and Bunge to have certainty on this acquisition ahead of the 2025 crop year. In that respect, the Government of Saskatchewan appreciates the timing of the final ruling from the federal government. ”

“Our priority is ensuring Saskatchewan producers continue to be competitive with access to key global markets.”

For Jake Leguee, board chair of the Saskatchewan Wheat Development Commission, the merger comes as a disappointment.

“We were hoping that a lot of the concerns that we raised, and that were raised by the Competition Bureau quite some time ago now, would have led them to make a different decision,” Leguee said.

Leguee said the terms and conditions attached to the deal don’t go far enough to protect the interests of farmers and competition within the grain handling industry.

“One of the biggest issues, that as far as we can tell hasn’t been addressed, is the Port of Vancouver. We’re going to see increased concentration there, which is the primary way that most of our exports leave the country,” Leguee said.

Leguee also highlighted issues with G3 and the canola crushing sector.

“Less competition is never really a good thing for producers. The players get bigger; we have fewer options,” he said.

Bill Huber, president of the Saskatchewan Association of Rural Municipalities also expressed concern over the merger and what it means for producers.

On Thursday’s Evan Bray Show, Huber voiced concern about the efficacy of the restrictions, such as the requirement of keeping Viterra’s head office in Regina for at least five years while employing at least 200 people.

“Those are short-lived things. Two years can go by pretty quick. Five years comes and goes and those things disappear from our province,” Huber said.

The Saskatchewan NDP also pointed to the canola crush plant in its criticisms of the deal.

NDP Leader Carla Beck said the merger puts the project at risk, along with head office, agriculture and value-added jobs.

“The federal and provincial governments should not have rolled over and let this anti-competitive merger go through. They should have stood up for Saskatchewan, instead of selling it out,” Beck said in a statement.

The federal government’s approval of the Bunge-Viterra deal puts Saskatchewan jobs and farmers at risk. Less competition means lower incomes and fewer opportunities.

The Sask. Party should have stood up for Saskatchewan, not sold us out. pic.twitter.com/n7txYykWgJ

— Carla Beck (@CarlaBeckSK) January 16, 2025

In a statement, the Government of Saskatchewan said its priority is ensuring producers in the province “continue to be competitive with access to key global markets

The provincial government said it is evaluating the terms and conditions attached to the federal government ruling with an aim to prevent any negative impacts on competition in Canada’s grain and oilseed sector.

–with files from 980 CJME’s Lisa Schick and Daniel Reech