About us
Investor relations
Credit ratings
The CWB has a direct, unconditional guarantee on its debt from the Government of Canada. The CWB has the following credit ratings on its debt:
| Term | Long term | Short |
|---|---|---|
| Moody's | Aaa | P-1 (Aa) |
| Standard & Poor's | AAA | A-1+ |
| Dominion Bond Rating Service Ltd. | AAA | R-1H |
Additional information regarding the CWB's ratings can be found in each rating agency's rating reports at the following Web sites:
Advantages of CWB notes
The CWB Notes offer many advantages, including:
- flexibility with a wide range of maturity dates;
- safety with an excellent credit quality and guarantee from the Government of Canada;
- liquid secondary market (flexibility to buy or sell your notes on the market); and
- regular offering of new notes into all markets.
- In addition to these, the CWB is 0% Bank of International Settlement risk weighted, placing the CWB among the best rated and lowest risk investments in the world.
All information included in the Investor Relations section of this Web site is provided for information purposes only. It is not intended to provide financial or other advice and does not constitute an offer to buy or sell CWB financial products. If you require more information or would like to invest in the CWB, please contact one of our dealers directly.
Investor Relations information contained on the CWB Web site is subject to change without notice.
Funding programs
Canadian Commercial Paper Program
Domestic Medium-term Note Program
The CWB is an active borrower in the domestic and international capital markets. The CWB borrows to finance current operations, credit receivables and programs such as the cash advance programs.
The CWB maintains five borrowing programs - the Canadian Commercial Paper Program, the U.S. Commercial Paper Program, the Euro Commercial Paper Program, the Euro Medium-term Note Program and the Domestic Medium-term Note Program. CWB debt is issued through a select group of financial institutions that act as agents on behalf of the corporation. However, the Euro Medium-term Note Program and Domestic Medium-term Note Program are available to all financial institutions.
Investors interested in one of the CWB's borrowing programs are welcome to contact our dealer network directly.
Description of issuer
Overview
The Canadian Wheat Board (the CWB) was established in 1935 by the Canadian Wheat Board Act, an Act of Parliament of Canada (the Act).On 11th June, 1998, the Parliament of Canada enacted legislation to amend parts of the Canadian Wheat Board Act. Under the amended Act, the CWB continued to be a corporation governed by the Act but, on 31st December, 1998, the CWB ceased to be an agent of the federal government. However, all CWB borrowings, both principal and interest are unconditionally and irrevocably guaranteed by the federal government of Canada.
The corporate objective of the CWB is to "market in an orderly manner, in interprovincial and export trade, grain grown in Canada". Subject to regulations under the Act, the CWB markets wheat and barley purchased from western Canadian producers for the best possible price both within Canada and globally. Under the Act, the CWB is the only entity in Canada empowered to market for export, and for domestic human consumption, wheat and barley grown in Manitoba, Saskatchewan, Alberta and the Peace River area of British Columbia.
Financing Authority and Statutory Guarantee
Under the Act and with the approval of the Minister of Finance, the CWB borrows money through three commercial paper programs and two medium term note programs. Although payment of principal and interest on such indebtedness is in practice made directly by the CWB out of grain sale proceeds, all borrowings of the CWB are unconditionally and irrevocably guaranteed by the Government of Canada. Any amount required to be paid pursuant to the guarantee is payable out of, and constitutes a charge on, the Consolidated Revenue Fund of Canada, the aggregate of all public moneys.General Operations
In each crop year, the CWB receives grain from farmers through the use of primary elevator companies acting as agents of the CWB. Although other options are available, the CWB's standard payment method is to make an initial payment at the time of delivery, which is set and guaranteed by the Government of Canada. If there are increases in the amount of the initial payment during the "pool" period, the increase is paid to all farmers who sold wheat and barley to the CWB before the increased initial payment became effective. The CWB then arranges for the transport, storage and sale of the grain in Canada and abroad. There are four separate accounts or "pools" for each crop year; wheat, durum wheat, barley and designated barley. Any balance remaining on such sales, over the initial payments, marketing, financing and administration costs of the CWB, is distributed to farmers after the crop year end. Losses over the history of the CWB have been rare. When losses do occur under the standard payment method, they are paid out in monies provided by Parliament.Sales
Sales of grain are made either for cash or credit. The credit extended to any country under the Credit Grain Sales Program cannot exceed certain limits established for that country by the Government of Canada. Most export sales are made directly by the CWB to the customer. The CWB may also sell grain to independent trading companies, which then export the grain under licence from the CWB. The CWB establishes prices for its grains on a daily basis, taking into account such factors as total exportable supplies in the world, relative supplies of Canadian grain by type, grade and quality, competitors' prices, foreign exchange rates, subsidies in importing and exporting nations, and variations in ocean freight rates.The CWB is one of the largest wheat and barley marketing agencies in the world with annual sales of Cdn$3-6 billion. Sales are spread out among more than 70 countries around the globe with some countries buying as much as two million tonnes of grain in a year and others less than 500 tonnes. The CWB's work on behalf of Western Canadian farmers has helped make Canada a major international wheat exporter.
Management
Under the Act, the CWB's business activities are directed and managed by a 15-member board of directors, including a President and a Chairperson. The Government of Canada appoints four of the fifteen directors on the recommendation of the Minister responsible for the CWB. Ten directors are elected by the grain producers of Western Canada. The Government of Canada, after consulting with the board of directors appoints the President, who becomes the fifteenth member of the board.Funding fact sheet
Click here to open the CWB funding fact sheet (PDF format 129 KB).
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Frequently asked questions
What does the CWB do with borrowed funds?
The CWB uses funds raised in its various borrowing programs to cover; producer payments, the advance payments program, credit sales and general administrative expenses.
Why does the CWB need to borrow U.S. dollars?
The primary purpose of borrowing U.S. dollars is to fund export credit sales. The CWB borrows U.S. dollars to cover the time lag between shipping grain under the export credit program and receiving payment for it.
Are the CWB's obligations backed by the Government of Canada?
All borrowings of the CWB are guaranteed by the Minister of Finance on behalf of Her Majesty in right of Canada. Therefore, CWB debt is regarded as the highest rated debt available in Canada with ratings equal to the Government of Canada and crown agencies. In practice, payment of principal and interest are made directly by the CWB out of grain sales revenues.
Is the CWB a crown corporation?
No. In 1998, the structure of the CWB changed from having 5 government appointed commissioners to a board of directors with 10 board members directly elected by the farmers and 5 board members appointed by the government. This changed the CWB structure from a Crown corporation to a Shared Governance Corporation.
What is the investment quality of CWB securities?
CWB securities offer credit ratings the same as the Government of Canada. The CWB is 0% Bank of International Settlement risk weighted making it one of the lowest risk investments, globally. Returns on CWB securities reflect the almost risk-free investment.
Does the CWB customize its securities to the requirements of institutional investors?
Yes; the CWB will endeavour to structure its medium term notes to respond to specific requirements of institutional investors who typically approach CWB. The commercial paper programs are flexible with regard to maturity dates and amounts.
What are the terms to maturity for CWB securities
The terms to maturity depend on each borrowing program. The domestic CP program (WBN) is 1 to 365 days, the USCP program is 1 to 270 days, the ECP program is 7 to 365 days and the medium term note programs are up to 15 years.
Where and how are CWB securities sold?
CWB commercial paper is issued through closed dealer groups. Medium Term Notes are open to reverse enquiry where any financial institution can be a dealer for a day (see the information for borrowing programs).
Can anyone buy CWB securities?
Yes. Anyone with a minimum of $100,000 CAD or USD (equivalent) can buy CWB securities. Potential investors should contact a member of the applicable dealer group.
What other currencies does the CWB borrow?
Under the medium term note programs and the ECP program, the CWB can borrow in any currency, subject to compliance with the applicable legal and regulatory requirements.