Manitoba potato monopoly...update [updated]

What do you expect when you set up a producer monopoly where the big players get to call the shots and the little guys have to play by their rules or have the government force them to destroy their crops?  Me, I don't expect good things for the little guys.  Turns out, I'm not wrong.  I'd noted last year the problems with the Manitoba potato monopoly (see here here and here).  The Manitoba Co-Operator (one of the main ag newspapers in Manitoba) is now onto the story.  Some excerpts:

They allege the provincially regulated marketing board has an unspoken, long-term strategy to squeeze out small growers and concentrate the $33-million table potato industry in the hands of a few large commercial operations.

“Nobody has ever said, eliminate small growers,” said an inside source who spoke on condition of anonymity. “But their actions show it. There’s a master plan here. The master plan is for five growers.”

That’s hard to prove or disprove because Peak operates behind a veil of secrecy.

...

While small, unregistered growers garner media attention, a less-known and much larger dispute occurs below the radar. It’s between Peak and its own commercial growers.

Producers are retiring their quota and leaving the industry, alleging discrimination against smaller operations and favouritism for large ones.

Dutka cited a case in recent years in which a large, southern Manitoba potato farm was caught illegally using herbicides to artificially enhance the col-our of red potatoes. Although the required $10,000 penalty was paid, Dutka says it was recorded on the marketing board’s records as a donation, not as a fine. The affair was hushed up and he never did learn what happened to the potatoes.

Dutka believes the penalty would have been different for a small grower. “He would have had to destroy his whole crop. He would have been tied to the wall.”

In other examples, Peak doubled the minimum quota for new growers from 3,000 bags to 6,000 several years ago. This pressured some smaller producers to either double their storage or drop out and grow under the former fouracre allowance.

Peak in 2007 increased a producer’s maximum allowable quota from 60,000 bags to 100,000 bags.

...

While small, unregistered growers garner media attention, a less-known and much larger dispute occurs below the radar. It’s between Peak and its own commercial growers.

Producers are retiring their quota and leaving the industry, alleging discrimination against smaller operations and favouritism for large ones.

Dutka cited a case in recent years in which a large, southern Manitoba potato farm was caught illegally using herbicides to artificially enhance the col-our of red potatoes. Although the required $10,000 penalty was paid, Dutka says it was recorded on the marketing board’s records as a donation, not as a fine. The affair was hushed up and he never did learn what happened to the potatoes.

Dutka believes the penalty would have been different for a small grower. “He would have had to destroy his whole crop. He would have been tied to the wall.”

In other examples, Peak doubled the minimum quota for new growers from 3,000 bags to 6,000 several years ago. This pressured some smaller producers to either double their storage or drop out and grow under the former fouracre allowance.

Peak in 2007 increased a producer’s maximum allowable quota from 60,000 bags to 100,000 bags.

...

“You just know you’re basically being disadvantaged every step of the way,” said one [small grower]. But few are willing to speak on the record for fear of being penalized.

“I know if I were to speak up and my name were made public, they’d be right on me,” said a grower who did not want his name used.

The climate of fear is real, said Erin Crampton, a Winnipeg green grocer. It’s confirmed that Peak recently hired a compliance officer to inspect shipments, decide who’s bypassing Peak and pass the information on to the board.

“There have been numerous occasions of strong-arming by Peak and inspectors coming in. There’s a lot of feeling that they’re a great big bully when it comes to the potato-marketing side of it. They’re scared that Peak will retaliate further,” said Crampton.

It is illegal to grow and sell a potato in Manitoba without getting permission. And it's your potential competition who'd have to give you that permission. And if you complain, there's no chance of getting permission. Ridiculous.

Update: See Laura Rance's column as well. She asks whether Peak is a marketing board or a private club. I think the word is "cartel".