Markets & Marketing

As far as cereal market development is concerned, it was not exactly a banner year for milling wheat. Toxin issues continue to reduce the quality of the crop available for sale as milling wheat. From a potential supply of close to 25,000 metric tonnes, GEC was able to purchase approximately 3500 metric tonnes with approximately 1400 metric tonnes carried over from the previous year. The remainder, 4980 mt was purchased as feed wheat.

Quality problems related to wet growing conditions downgraded the remainder with the balance of milling wheat destroyed, salvaged for fuel, stored, or marketed through the feed trade.

This has been a mixed blessing as acres diverted to soybeans have resulted in less local cereal production for the existing livestock market and a short local supply. On the other hand, the expanding fish industry has created greater local demand for feed wheat. Both these events appeared to have stabilized markets somewhat for livestock feed crops. Demand for cereals will be supported as one large Atlantic business in Moncton N.B. is investing in new feed mill technology and equipment.

Another important factor which is strengthening local demand has been the increased presence of the large grain companies throughout the Atlantic region. GEC has developed successful business relationships with all of them and is thus able to react to the evolving export orientation of the PEI cereal and oilseed industries. That is, whenever a commercial opportunity exists, GEC can supply a large quantity of product at a competitive price. Through relationships with the local transportation industry and Halifax Elevator system, GEC has virtually doubled its capacity in the last decade.

GEC has also participated actively in a number of studies completed over the last year involving the identification of new geographic locations, markets, and food processing opportunities for local cereal and oilseed crops. A pearled barley soup mix being explored for further development by the P.E.I. Federation of Agriculture is an example of such a product.

Competition for many markets is stiff when all aspects are considered. Approximately 1700 metric tonne oats were delivered to all three GEC locations. Sometimes the freight remains a disadvantage. For example island oat growers experienced excellent growing conditions for that crop this year. There is a potential to access a lucrative market for food grade oats in Ontario and the eastern states. However, the higher freight and handling costs associated with delivery to those markets negates most of the benefit, relegating an otherwise high quality product to the local feed market as the only viable alternative.