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United Grain Growers (Agricore United)
United Grain Growers (UGG) was a prairie-wide Agricultural Marketing, handling, and supply company from 1917 to 2001. The UGG name, like that of its successor Agricore United, was a familiar sight on grain elevators and other facilities across the prairies. Today Agricore United remains (in its own words) “Canada’s leading farmer-directed agri-business.” The company’s head office is in Winnipeg. UGG was formed in 1917 by the merger of two earlier farm co-operatives, the Grain Growers’ Grain Company (GGGC) of 1906 and the Alberta Farmers’ Co-operative Elevator Company of 1913. Combining the businesses of its predecessors, it both marketed farmers’ grain and operated a growing network of country and terminal elevators through which that grain was handled. It also inherited small farm-supply and livestock-marketing businesses. Additional services were added and expanded as the company grew.
At first UGG faced criticism from farmers who were advocates of farmer co-operation. Like its predecessors, it did not pay patronage refunds, which was considered a co-operative principle. Its extensive farm-supply activities also undercut local co-operative associations that were spreading and organizing themselves in the 1920s and 1930s. Activists charged that UGG was not a true co-operative. Criticism abated in the 1930s, largely because UGG joined with other co-operatives, particularly the three prairie wheat pools, to make common cause in educational programs and agricultural lobbying. Meanwhile the company continued to expand: at the end of 1917 it operated 332 country elevators, 184 coal sheds, and over 200 warehouses. UGG continued to build and purchase elevators through the 1920s, reaching 468 in total by 1932. This number declined during the Depression, but the company expanded again in the 1940s to 1960s. UGG made major purchases from the Gillespie (1943), Reliance (1947), Midland and Pacific (1954), Canadian Consolidated (1959), and McCabe (1968) grain and elevator companies. The system peaked in size in the 1960s with over 800 elevators. A period of consolidation followed, and by 1990 the company operated country elevators and annexes at 276 points.
UGG had begun with terminal elevators at Fort William and Port Arthur. In 1925 it bought a controlling interest in a terminal in Vancouver, and in 1927 it constructed a new terminal at Port Arthur. As the company grew and purchased facilities from other companies, it acquired additional terminals, expanded their capacity, and undertook a series of modernizations from the 1950s until the 1980s. Livestock was a growing business over the years. The farm-supply business evolved: machinery, lumber, fruit, and vegetables disappeared, while feeds and especially fertilizers and crop-protection chemicals increased in importance. The company also took over and continued the publication of the Grain Growers’ Guide, renamed Country Guide in 1928. The Public Press, a UGG subsidiary responsible for the Guide, also purchased a number of other farm publications over the years, notably Canadian Cattlemen (1953).
UGG’s feed operations were consolidated into a new company, United Feeds Ltd., in the 1960s and 1970s. Other operations were consolidated and centralized in Winnipeg in the 1970s. The company became increasingly involved in the marketing of various agricultural crops, including non-Canadian Wheat Board grains, export grain, and domestic feed grain (1974), as well as specialty crops such as corn, sunflowers, and lentils (1978). In the 1980s the company continued to expand in the livestock business and to create selective new enterprises such as Farm Decision Resources, a research and consulting agency. Meanwhile it restructured, streamlined, and downsized less profitable activities. Field services were reduced; oilseed and pet-food interests were shut down or sold; the printing division and Public Press were sold in 1991 (although Agricore United retained the company’s most popular titles until 2003).
UGG had a number of well-known presidents and managers, who were important figures in the agriculture industry. These included T.A. Crerar and John Brownlee; one of the best known in later years was A.M. (Mac) Runciman, a farmer from ABERNETHY. Runciman was president of UGG from 1961 to 1981, a key period in the company’s transformation. While UGG was governed by farmer-investors from across the prairies, it emphasized business more and philosophy less than did the other farmer-controlled co-operatives of the same era. Under Runciman’s leadership, UGG became known as a critic of centralization and government regulation, and an advocate of more flexible, market-oriented policies in grain marketing and transportation.
At first UGG continued to participate in joint ventures with other farmer co-operatives. In 1970 it joined with the three prairie wheat pools to form XCAN Grain Ltd., although UGG’s participation lasted only until 1974. Over time the company converted more to an investor-driven model, and it was restructured legally and financially a number of times. In 1965 its charter was amended to provide for greater capitalization and for more shares to be held by any one shareholder. The company was reorganized in 1992–93 in preparation for a public share offering: its shares are now publicly traded on the Toronto Stock Exchange. After this conversion, UGG was no longer generally recognized as a co-operative.
In 1997 UGG concluded a strategic alliance with US-based Archer Daniels Midland (ADM), which grew to the point where ADM was reported to own more than 20% of Agricore United in 2004. Further change came as the company strove to expand in the face of changing conditions in the agribusiness sector. Competitors Alberta Wheat Pool (1923) and Manitoba Pool Elevators (1925) merged in 1998 under the name Agricore. In 2001 UGG acquired Agricore from its shareholders in exchange for 20 million shares in UGG; Agricore became a wholly owned subsidiary, absorbed in 2003. Agricore United retained a substantial element of control by farmer-members. As of 2004, twelve of fifteen directors of the company were elected by farmer-members who did business with the firm; the other three were elected by shareholders, including strategic partner ADM. A minimum of two of the twelve elected directors must be from Saskatchewan.
In 2004 Agricore United had 87 licensed primary elevators (1.2 million tones storage capacity), of which thirty elevators with 356,000 tonnes capacity were in Saskatchewan.
Brett FairbairnPrint Entry
Further ReadingColquette, R.D. 1957. The First Fifty Years: A History of United Grain Growers Limited. Winnipeg: Public Press; Earl, P. 2000. Mac Runciman: A Life in the Grain Trade. Winnipeg: University of Manitoba Press.