Farmers are lying to Statistics Canada about their seeded acreage, their yields and their stored production. Some producers actually take pride in this. In the end, it could backfire.
To be sure, it’s annoying to get the calls from Statistics Canada as they do their various crop production surveys.
Unlike private industry surveys where you can just hang up or tell them to shove it, StatsCan survey callers make it sound mandatory. I’ve never heard of any ramifications for a producer who refused to respond to Big Brother, but the calls aren’t easy to brush off.
It is pretty easy, however, to lie, or at least be selective about the truth.
Many producers hold the view that StatsCan reports just hurt prices. When buyers find out how much is seeded or what the yields are or how much is produced, it just gives them an excuse to drop the price.
Therefore many producers make up data that they think will make the market more bullish.
Brian Clancey of Stat Publishing is a well-known private-sector market analyst. In the most recent Pulse Market Report written for Saskatchewan Pulse Growers, Clancey notes that this is the second year in a row that Canada will probably sell more lentils than were supposed to be available.
Clancey says the sales statistics are going to show that when this marketing year started we had 125,000 to 175,000 more tonnes of lentils on hand than Statistics Canada thought.
While his article in Pulse Market Report was polite, Clancey readily admits that the discrepancy is probably the result of producers providing inaccurate survey information.
It appears that enough producers have been “underestimating” their lentil stocks that the lie is now apparent. Oh well, the lentil market is still bullish. If the “lie” has helped producers, what harm has it done?
The harm is that the industry will eventually lose confidence in the StatsCan numbers. If that happens, the trade will make its own estimates.
Up until now, StatsCan numbers have been considered the best information source available. Producers, buyers and export customers all see the same information at the same time.
If StatsCan wasn’t doing surveys or if the surveys lose credibility, you can bet that the industry will make its own estimates. But those will not be shared with farmers.
The StatsCan process has a number of flaws. Too much time expires from when farmers are surveyed and when the information is compiled and released.
Another problem is that producers are expected to have a myriad of numbers on the tip of their tongue. In all fairness, producers should be given more time to compile their numbers before answering a survey.
And the people doing the surveys should be more knowledgeable. Many of them haven’t got a clue about what they are asking.
Most importantly, more effort is required to explain the importance of a non-biased source of information. Countries such as China are often vilified for cooking up production statistics to manipulate world markets. We’re supposed to be above that sort of activity.
On most commodities, most of the time, StatsCan numbers are still regarded as the best information available. Unfortunately, the surveys are unpopular and underappreciated. Without support from primary producers, the system is in peril.
Kevin Hursh is a farmer and consulting agrologist based in
Saskatoon. He can be reached at [email protected]