Murray Fulton
Professor, Johnson-Shoyama Graduate School of Public Policy

February 19, 2013

Game Changer for the Canadian Wheat Industry

Filed under: uncategorized — murray @ 4:48 pm

I was recently asked to speak at the Growing Canada’s Agricultural Economy: The Role of Trade conference that was held January 23-25, 2013 at the Château Laurier in Ottawa. The conference was organized jointly by the Canadian Agricultural Economics Society and the five ‘Enabling Research for a Competitive Agriculture’ (ERCA) policy research networks. Click here for a link to the conference program and presentations.

The subject of my talk was the need for a game-changer in the wheat industry. The problem facing the Western Canadian wheat industry is that wheat yields have not risen nearly as fast as those of corn, or even canola. And they are not expected to catch up any time soon. The cause of this problem is a lack of research funding. Generating more funding requires bold action that would see producers trade-off end point royalties and higher levies for a much more substantial role in breeding and crop development. Without such action the industry will continue its downward slide. With such action, the current reasonably strong producer groups can be greatly strengthened and a platform for private sector investment can be created.

For a copy of my remarks, please click here. For a discussion of my remarks in The Western Producer, click here (see page 5 of the January 31 edition and page 10 of the February 7 edition).

August 31, 2012

Provost’s Award for Outstanding Graduate Teaching

Filed under: uncategorized — murray @ 12:53 pm

The Provost’s Award for Outstanding Graduate Teaching is awarded annually at the U of S to recognize an outstanding teacher who demonstrates excellence in teaching courses at the graduate level. This year, Murray Fulton, Professor at the Johnson-Shoyama Graduate School of Public Policy, has been recognized for his contributions in the area of graduate teaching.

“When given the opportunity to nominate one of our faculty for this award, Murray was an obvious choice,” said Michael Atkinson, Executive Director at the Johnson-Shoyama Graduate School of Public Policy. “In the last 10 years, he has supervised 13 Masters students and 12 PhD students to completion, participated in dozens of supervisory committees and acted as a mentor to his students and fellow faculty members.”

Atkinson went on to explain how Fulton has been a leader in implementing new technology to enhance the learning experience. JSGS is a joint partnership between the University of Saskatchewan and the University of Regina, and Fulton has excelled at the challenge of engaging students remotely with the use of technology.

Fulton’s nomination was also supported by many current and former students. In response to one course Fulton had a hand in developing from scratch; one student described the class as an “absolutely amazing course.” The student went on to say, “Dr. Fulton is an inspiring instructor. It is obvious that he loves teaching. When moderating discussion in class he is fair, and really encourages input, but at the same time is clever in his ability to keep things on track and challenge students to actually contribute to the discussion.”

Another former student had a similar experience indicating, “Murray Fulton is one of the best professors I have ever had…. He had a great sense of humour as well as an obvious desire to teach and have his students succeed. This was the best course I have taken so far with the JSGS…and I thought it would be the worst.”

“My approach to graduate teaching echoes my experience as a graduate student,” explains Fulton in his statement of teaching philosophy. “Indeed, my goal is to have students remember their graduate student days as a time when they made their academic leap; a time when they reached the point where they understood the material well enough that they could begin to create their own models and develop their own insights.”

In recognition of receiving this award, Fulton will receive $2,000 that he will use to support work he has wanted to undertake around innovations in graduate teaching. In addition, he will be recognized at a Celebration of Teaching hosted by the Gwenna Moss Centre for Teaching Effectiveness.

For further details, click here.

February 16, 2012

Sources of Institutional Failure and Underinvestment in Levy-Funded Agricultural Research

Filed under: uncategorized — murray @ 2:08 am

Julian Alston and I recently completed a paper on “Sources of Institutional Failure and Underinvestment in Levy-Funded Agricultural Research.” Julian presented this paper in Australia at the Australian Agricultural & Resource Economics Society (AARES) meeting in Fremantle, Western Australia, February 7-10, 2012. Click here for a copy of the paper.

Abstract

Commodity taxes (or levies) are used widely to finance commodity collective goods such as R\&D, promotion, public relations, market information, uniform grades and standards, and quality assurance. In this paper we develop heuristic and formal theoretical models to examine producer choices of rates of levies for financing agricultural R\&D programs, and the implications of matching government support, the justification for which has been questioned by the Productivity Commission. Previous work has emphasized the roles of characteristics of markets and the nature of the research-induced technological change as determinants of the choice of the levy rate and the total research investment. Here we build on that work in an analysis that emphasizes the roles of heterogeneous producers in collective decision-making processes when change is costly and a simple majority is not the usual criterion.  Our analysis implies that collective decisions will lead to underinvestment and high private and social rates of return, especially if supermajority rules effectively apply, which is consistent with evidence on existing levy-funded agricultural R\&D programs.

Operating in a Post Single-Desk Environment — Port Access and Competition in Grain Handling on the Canadian Prairies

Filed under: Public Policy — murray @ 2:02 am

I gave a seminar in the Bioresource Economics Policy Business and Economics department on February 3, 2012. The abstract for the seminar is presented below. Click here for a copy of the slides that I presented at the seminar.

Abstract

The removal of the CWB as the sole seller of grain from Western Canada will have a significant impact on the grain handling and transportation system (GHTS). Of particular concern is the pricing of port access at the West Coast. The grain handling industries in Western Canada are highly concentrated with the top four grain handling companies having 72 percent of primary grain handling capacity inland and 97 percent of the port capacity at the West Cost. The concern has been raised that these companies will not have an economic incentive to provide access to port facilities to competing firms such as the new voluntary CWB, producer loading facilities and producer-owned terminals. Without port access, these competitors will not be able to compete for grain at the country elevator level, which in turn will affect the price offered at the country elevator level. This paper examines the economic incentives for the existing holders of terminal capacity. The paper shows that generally the owners of port facilities will use their market power to restrict sales through their facilities by charging very high prices for port access. This behaviour has implications for competition on the country elevator level, where spatial could emerge, and for the significantly reduced farm gate prices that farmers receive. The paper also examines the implications of introducing competitive port access, as has been done in Australia in the wake of the removal of the AWB’s single desk powers.

November 14, 2011

Conference – Operating Successfully In A New Grain Marketing Environment: Issues Facing Farmers, Agribusiness and Government

Filed under: uncategorized — murray @ 2:48 pm

The purpose of this conference is to lay out key issues that farmers, agribusiness firms and government will face in the grain marketing, handling and transportation system that will emerge after the passage of Bill C-18. The status quo will not be viable. All participants in the system will have to respond and adapt. This conference examines the areas most likely to see change and provides an analysis of options for industry participants.

The conference is being held December 12 and 13, 2011 at the Saskatoon Inn in Saskatoon SK.

Click here for conference details.

November 13, 2011

Challenges Facing the GHTS in a Post CWB Environment

Filed under: Public Policy, Working Papers — murray @ 8:07 pm

On October 18, 2011 the Government of Canada introduced Bill C-18 to remove the Canadian Wheat Board (CWB) as the sole seller of wheat and barley produced by farmers in Western Canada. On the surface this legislation looks merely to introduce a change in the way that Western Canadian farmers market their grains. Deeper down, however, there is something much more fundamental happening. The changes proposed to the CWB represent a significant regulatory change in which administrative fiat would be replaced by market transactions.

While the shift in the structure of the GHTS is significant, it should not be assumed that this is the end of the changes. As is argued in this paper, there are numerous reasons to believe that the GHTS will suffer from a number of market deficiencies — in particular, high market concentration, externalities and the lack of provision of public goods. If a government’s role is to put in place a GHTS that is efficient in its operation and provides widespread benefits to its participants (perhaps at the behest of some of the participants that feel they are not benefitting), then it will be incumbent on policy makers to look at ways at addressing these market deficiencies.

Although the upcoming changes to the CWB will mean the end of policy discussions about the CWB, they will not mean the end of policy discussions. The deficiencies that will be present in a market-oriented GHTS are not new. Indeed, they have been an integral part of the industry for over one hundred years and will be the focus of policy discussions for years to come.

To download a copy of the Working Paper on which this analysis is based, click here.

November 12, 2011

Podcast: Assessing the future of wheat marketing in Canada

Filed under: Public Policy — murray @ 1:25 am

Professor Brady Deaton at the University of Guelph has launched a website FARE-talk where he provides podcasts of interviews designed ”to provide an enduring conversation about contemporary topics relevant to food, agricultural, and resource economics.”

The October 20, 2011 podcast is titled “The Canadian Wheat Board (CWB): Assessing the future of wheat marketing in Canada.” As Professor Deaton outlines on the site, “In this podcast Dr. Murray Fulton and I discuss the Canadian Wheat Board (CWB). Specifically, we assess the current marketing arrangement under the CWB and changes that will occur if the CWB’s single-desk authority is removed. Murray reviews the history of the Canadian Wheat Board and anticipates a future without it. Murray ends the podcast by directing our attention to issues that will be of ongoing interest as future events unfold.”

To go to FARE-talk, click here.

September 12, 2011

Ag Research and Global Food Security

Filed under: Public Policy — murray @ 2:42 am

A colleague of mine, Richard Gray, has been doing research on agricultural research and its implications for food security and food prices. This short video nicely captures his conclusion that agricultural research funding needs to be substantially increased if the world is to escape rising food prices.

May 20, 2011

Co-operative Restructuring

Filed under: Co-ops — murray @ 7:12 pm

I had a request recently for a paper I co-authored a few years ago on the restructuring that was underway in the co-operative sector in Canada and the United States. The paper suggested a number of lessons that co-operatives might find useful as they attempted to deal with the significant changes that were occurring in the economy and society. Since these lessons would appear to be applicable today, I have presented them below. The full text of the paper can be found here.

(1)       Be careful about letting power accumulate in the hands of the CEO and senior management

(2)       Board members need to be properly prepared and equipped if they are to participate effectively in decision making in what is an increasingly complex world

(3)       There is a need to create an identity that members can buy into and embrace

(4)       This identity, and the strategies that go with it, must be aligned with the interests of the members and the interests and the ability of the co-operative

(5)       The co-operative and its activities must be structured so as to provide members with a sense of ownership and trust

(6)       Develop a sense of realism about what a co-operative can and cannot do

(7)       Make sure that decisions are not based on the latest business school prescriptions or are undertaken on “faith”

(8)       Instead, undertake the required research before entering into new ventures or activities

(9)       Identify and tackle the key structural issues that the co-operative is facing

(10)    Retain flexibility so that the co-operative can reposition itself as events change

January 21, 2011

Potash Back in the News

Filed under: uncategorized — murray @ 11:44 pm

Potash is back in the news this past week when it was announced that Cargill was selling its shares in Mosaic, one of the world’s major potash companies. The sale of these shares could make Mosaic a take-over target. The sale could also signal that Mosaic itself is now open to undertake acquisitions, something it has not done historically. Regardless of the what happens as a result of the Mosaic announcement, it is clear that there is likely to be considerable activity in the potash industry in the next while. In December, a Russian billionaire announced the merger of two Russian potash companies. Although it is impossible to say who the merger partners might be, expect to see additional mergers as firms rush to position themselves in what many analysts expect will be a highly profitable industry.

See the following links for more on these developments:

Russian MergerGlobe and Mail, December 20, 2011

The Mosaic AnnouncementGlobe and Mail, January 18, 2011

What This Might Mean for MosaicGlobe and Mail, January 18, 2011

Saskatchewan Government ReactionGlobe and Mail, January 19, 2011

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