Canadians like to think of this country as an agricultural superpower, where farmers grow vast amounts of food to help feed a hungry planet. The reality is much different – far from leading the world in agriculture, Canada is falling behind on many fronts.
Canadian farmers are still remarkable producers, accounting for more than $30-billion worth of exports annually. But they have become less productive, less competitive and more financially strapped than their counterparts in many countries. Meanwhile, nations like Russia, Brazil and even Kazakhstan are investing heavily in agriculture and becoming fierce competitors.
The trend lines aren’t promising. In the past 15 years, Canada’s share of the global wheat market has shrunk to 15 per cent from 23 per cent, and it has dropped from third to ninth in terms of total food exports. Russia recently surpassed Canada as the world’s third biggest wheat exporter, Kazakhstan has doubled its wheat exports, and Brazil has overtaken Canada as the largest agricultural power behind the United States and the European Union.
It’s not because other governments are outspending Canada on farm subsidies. While Canada ranks just below average among OECD countries in terms of producer support payments, it’s ahead of NAFTA partners the United States and Mexico. Canada is also one of the few Organization for Economic Co-operation and Development members to increase those payments in recent years, according to a 2008 study by the Paris-based organization.
In fact, government money has been flowing steadily to Canadian farmers for decades. Over the past 20 years, direct payments to farmers by the federal and provincial governments have tripled, and total spending on agriculture now tops $8-billion annually. Despite all that spending, farm incomes in Canada haven’t budged much in decades, and farm debt levels have soared. Farm incomes are rising in the United States, where farmers carry much less debt. The debt-to-income ratio for Canadian farmers is about five times higher than for U.S. farmers, according to researchers.
So what’s the problem? Almost any farmer will recite a litany of concerns – misguided government programs, the soaring Canadian dollar, outdated tax measures and regulations that are 10 years behind those of other countries. Many say Canada is stuck in the past, constantly tinkering with income support measures and ad hoc programs while U.S. farmers leap ahead in productivity, and producers in Australia, Argentina, Chile and Ukraine push aggressively into new markets.
“It’s quite apparent that we don’t have a vision for agriculture,” said Garnet Etsell, a turkey farmer in Abbotsford, B.C., who is also on the executive of the Canadian Federation of Agriculture. “We’ve got the resource base that’s needed to be a strong food supplier to the world ... but we sit back.”
Fear and frustration are so high that the CFA recently launched an effort to develop a national food strategy. About two dozen organizations representing farmers and food processors have joined so far, and the CFA is hoping to get consumer groups and government officials involved. The objective is to develop a long-term plan for the whole system – from field to table – by modernizing regulations, driving innovation and ensuring Canadian products are the preferred choice in international markets.
“When you really look at it, we don’t value food in this country, because it has been a land of plenty for so many years,” said Neil Currie, general manager of the Ontario Federation of Agriculture, who is co-chairing the project with Mr. Etsell. “I keep telling this story of meeting the equivalent of the deputy minister of agriculture from Sudan. Sudan doesn’t have food, they have subsistence farming at best. But they have a national food strategy because they value food. They know they need to plan for it because it’s not always there.”
Federal Agriculture Minister Gerry Ritz acknowledges Canada has fallen behind in recent years. “We were not really getting out there and doing the job,” he said in a recent speech to Parliament. “One of the first things asked by a lot of these countries when we got [out into emerging markets] is where have we been? The Australians, the Americans, the European Union, Brazil and some of the emerging economies like China and India are aggressive marketers, and are getting to be more so.”
