EDITORIAL 2002
The long-anticipated
announcement of a new funding and support package for agriculture finally arrived
on June 20, and was welcomed by OCPA and other farm groups across the country.
But the flurry of news releases that such announcements inevitably bring carried
several common themes – what are the details? How will new programs be implemented?
Will they address the real and immediate needs of the sector? Can federal-provincial
agreements be reached that will allow sufficient flexibility to answer specific
needs and concerns?
A few weeks later, some things are starting to become clear. The Ontario government,
along with the governments of several other provinces, has committed its support
for the Agricultural Policy Framework agreement. And in a news release issued
on June 28, Helen Johns, Ontario Minister of Agriculture and Food, affirmed that
Ontario’s support extends to providing a 40% share for two years of ‘bridge’
or ‘transition’ funding for farmers as well.
That’s the good news – a sustainable future for the industry is absolutely
dependent on both short-term transition support and a long-term vision that will
provide increased opportunities and sound risk management. And both provincial
agriculture and food minister Helen Johns and federal agriculture minister Lyle
Vanclief are deserving of our congratulations: Minister Johns for her commitment
to working closely with her constituents and her determination to get the best
deal possible for Ontario’s farmers, and Minister Vanclief for his efforts
in moving the agriculture agenda forward as well as his recognition of the need
for more flexibility in the implementation of the program than had originally
been planned.
But, as the old saying goes, we have miles to go before we sleep. And while government
bureaucrats work out the finer program details, corn and other grain and oilseed
producers across Ontario continue to struggle with the low prices and subsidized
grain flow into the province that have already resulted in 5 consecutive years
of negative net farm income for grain and oilseed farms. With no end to the decline
in sight.
The problem is simple enough: the sector is in crisis as the result of U.S. agriculture
policy. It’s not a shortage of markets for the products: traditional uses
and expanding industrial/processing uses provide ample market opportunities and
options. It’s not Ontario producers’ inefficiency: Ontario’s cost-of-production
for major crops is equal or less than that of adjacent states. It’s not their
low productivity, either: Canada has outpaced the U.S. and the EU in farm production
growth, and Canadian farmers increased their productivity more than twice as fast
as the Canadian business sector overall in the period 1988-1997. In short, our
farmers are doing everything they can to operate their businesses in a fiscally
sound manner. And their efforts are working. But it’s simply not possible
to compete on a field this uneven.
OCPA and other grain and oilseed groups across Canada have urged the provincial
and federal governments to recognize the injury to the sector resulting from the
harmful impact of foreign policy, and to ensure that the transition, or ‘bridge’
funding recently announced be used to address proven hurts and demonstrable needs.
Questions regarding provincial allocations and the distribution of the recently
announced transition funds need to be settled quickly and in an equitable manner.
The traditional practice of basing provincial allocations of federal funding on
farm cash receipts from non-supply managed commodities would seem to be a logical
approach – that means at least 21% for Ontario. And as governments and farm
organizations agree, funds should be targeted specifically to those sectors most
in need as a result of current conditions.
And there must be a mechanism for getting money into farmers’ hands quickly
– many farm families have long been in urgent need.
The ongoing crisis in the grain and oilseed sector underlines the need for effective
agricultural policy for Canada. And basing such a policy on Canada’s strengths
– environmental stewardship, food safety and quality, enormous potential
in research and innovation, etc. – is a great place to start. But that’s
not enough. The Agricultural Policy Framework (APF) must also recognize that Canada
is a trading nation. Policies enacted by our trading partners will continue to
have a direct impact on our producers.
The new U.S. Farm Bill provides subsidies at historic high levels for American
producers through 2007 (see related story this issue). The impact on Canadian
(and other foreign) competitors will be devastating, especially in the grain and
oilseed sector. And though negotiations to address the issue through the World
Trade Organization (WTO) are underway, success – even if possible –
is a long way off. Until it is achieved, Canada’s APF must contain provisions
for offsetting the injury to our producers if the industry is even to survive
over the long term.