Panelists at the Canadian Federation of Agriculture’s annual general meeting in Ottawa discussed how the recently announced framework could mean a new era for agriculture’s relevance in Canada and what producers must do to get their voices heard by the government.

The NPF will succeed the current Sustainable Canadian Agricultural Partnership (SCAP) and involve negotiations with sector leaders ahead of the 2028-33 period.

As Greg Meredith, former deputy minister of the Ontario agriculture ministry, put it, there has never been a better time for Canadian agriculture to be framed as a growth opportunity.

He said the current government’s action on canola has suggested a renewed commitment to agricultural priorities.

“That was a really important step, from my perspective, to tell the sector, to tell me, to tell agriculture that there’s an opportunity to get back on the front bench with this government.”

He said the attention on agriculture has not always been common among governments.

“As deputy minister (for agriculture) I felt it. As deputy minister in economic development and trade, I felt it. In labour skills, immigration training and other ministries that I was deputy of, I felt it,” Meredith said.

“Agriculture was not job one.”

He also said the message of unity across government jurisdictions could help unite sector voices.

“Find the common interest and push on it,” Meredith said.

“I think this prime minister is listening.”

Stan Vander Waal, president and owner of Rainbow Greenhouses Inc., called the NPF an “opportunity for us to kind of reinvent ourselves in agriculture.”

“When our back’s against the wall, that’s often the time we get creative about how we deal with things, and that’s where I see us right now, when we look at this Next Policy Framework,” Vander Waal said.

“When I think of some of those challenges and I think of the opportunities that are up ahead, it’s like, if we face it with optimism, that’s where the opportunities really flow from.”

‘Fundamental consensus’

Part of this process will involve finding common ground between industry and government. Vander Waal said one challenge in similar discussions is agriculture’s occasional tendency to splinter and fail to present unified goals.

He said that while governments may be good at engaging different groups, in the end they will generally prioritize the one with the best chance of growth.

“They’re focused on trying to represent a big cross-section of farmers. So, what are the common objectives? When we talk about growth, that’s a common objective. We talk about profitability, that’s a common objective.”

Managing specific tactical problems are not necessarily common objectives.

Marvin Slingerland, senior vice-president of agriculture at MNP, also emphasized the importance of the agriculture sector staying unified throughout consultations.

“Find that base of common interest across all commodity groups, across all provinces and unify around that voice,” he said.

Slingerland warned that challenges can arise when many sector groups approach governments with different interests. This allows the government to pick and choose what to prioritize and then claim it is responding to stakeholders.

“Don’t get caught in that trap,” he said.

“Start off with the fundamental consensus and then lead the government where you want them to go. Governments do want to be popular and want to listen.”

Vander Waal said the agriculture sector should be prepared to make sacrifices if it wants to see new gains and ask the question of “what will we give up to get this?”

“I look at it as, we’re trying to make a deal,” he said.

“We’re trying to find (the) common ground between us and the government.”

If “the objective is growth and profitability, then let’s put on the table some of the things we’re willing to give up. Well, let’s also point out some of the things that we need to basically get us to where we need to be.”

Incentives wanted

Meredith expanded on the point by saying the discussion could go also include producers considering what they provide to the government.

“I don’t know that the conversation of engagement with2323w the government should be, ‘what can we give up and what do you give us in return?’ ” he said.

“I would start by (saying), ‘what are we giving you, besides food and feeding the gosh darn country, which is pretty important.’ There are all kinds of benefits that accrue from a healthy ag sector in this country.

“When Prime Minister Carney talks about reigniting the Canadian economy and generating growth and wealth for the country, this is a sector he should be starting with.…

“In my view, ‘what are you going to do for the government?’ is a question I think you should be posing to governments. What can we do for you if you get out of the way?”

He pointed to the current attention given to the cost of food in Canada and how farmers could help to address the issue.

“Let’s take a different perspective with governments and say, ‘let us solve these problems for you, but in return, we’ll need some other things.’ ”

Vander Waal and Slingerland both said new money allocated in the NPF should go toward advancing productivity and growth.

Vander Waal said he would like to see incentives encouraging farmers to take on new investments.

“Right now, I sometimes feel that … it’s the opposite,” he said.

Slingerland said he would encourage “a transformative tax policy to create investment,” such as the transferrable tax credits he sees in the United States.

“If you’re building a $10 million greenhouse, you might … be negative cash flow for two, three years, but you might have a $2 million investment tax credit that you can actually sell.”

National consultations on the NPF are expected to run until December 2027. The first phase of the process will be open until June 30.

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It should reflect regional differences, recognize early adopters and improve data and measurement.

The “what we heard” report was posted to Agriculture Canada’s website during the holiday season. It outlines the feedback from consultations, workshops and written submissions gathered between December 2022 and March 2023.

A final strategy was supposed to be released in late 2023, but the department now says it will be sometime this year.

Stakeholders said direct incentives to increase the adoption of best management practices and technology were critical. Farmers have to see the financial sense of changing practices.

“They emphasized that incentives needed to be long-term and should consider the cost of adoption, return on investment and the ecological goods and services provided. Furthermore, incentives and support must be made available to a variety of farm sizes, particularly to those who do not have the capacity to measure GHG emissions or carbon sequestration, or are unable to afford costly clean technologies,” the report said.

Both smaller and larger farmers had concerns.

Small and medium-sized farmers said they didn’t have large enough financial buffers if they attempted to implement a new practice and failed.

“Large-scale producers were concerned around their ability to remain competitive and profitable in global markets, competing against producers from other countries with different policy and programming support from their respective governments,” said the report.

“Small-scale producers who participated in the consultation noted their financial struggles and inability to access government funding and programming for a variety of reasons, including high cost-share ratios and disappearing local and regional infrastructure (grain terminals and abattoirs) vital for their survival.”

The need to recognize early adopters was often mentioned in the best management practices discussion. These producers have already tackled change but can’t access current government programs. The report said these producers should be viewed as mentors and leaders and their success publicized to encourage others to follow suit.

The loss of agricultural land was also mentioned, particularly by respondents from Ontario and British Columbia. Participants were concerned about who was buying land and why, and the discussion included increased calls to better regulate foreign ownership of farmland, the purchase of farmland for non-agricultural purposes and the overall consolidation of agricultural land in fewer hands.

Respondents noted data gaps and the lack of a cohesive, consistent measuring policy around agri-environmental data collection and analysis at all levels.

Nationally, there were concerns about how agriculture is modelled in the National Inventory Report. Regionally, the data is fragmented and drawn from many sources, which makes it difficult to develop comprehensive, valid data sets.

“And at the local level, producers need tools to measure and collect data on their farms, helping them make production decisions and more informed investments. Overall, there was a strong call for a data strategy to collect, manage and communicate data on GHG emissions, biodiversity, water, soil health and resilience, with solutions to address the data and measurement challenges developed with the sector and various stakeholders at different levels to effectively measure change,” said the report.

The report is based on 420 responses; 41 percent of those were producers while six percent represented producer or industry associations.

—Karen Briere writes for the Western Producer from Saskatchewan.

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China’s 2020 pork output fell 3.3 per cent from a year earlier, to 41.13 million tonnes, after plunging 21 per cent in 2019, the National Bureau of Statistics said.

But some analysts said they had expected a much bigger fall in 2020 after African swine fever (ASF) ravaged China’s breeding stock in 2019. China’s stock had fallen by an estimated 60 per cent by mid-2019 after the disease hit China in mid-2018.

The reading is “quite high, higher than I expected. In November, we probably expected a 10-15 per cent decline,” said Pan Chenjun, senior analyst at Rabobank.

Xiao Lin, analyst at Shenzhen-based Win & Fun Investment, also said she had expected a bigger decline of between five and 10 per cent in 2020 output.

Policy support and incentives helped revive the sector by unleashing more than 200 billion yuan (C$39.3 billion) in investment.

China slaughtered 527.04 million hogs in 2020, the data showed, down 3.2 per cent from the same period a year earlier.

Output in the final quarter of 2020 jumped to 13 million tonnes, according to Reuters calculations based on the data. That is up 21 per cent from the 10.74 million tonnes produced in the same quarter a year ago and higher than 8.4 million tonnes in the third quarter.

Despite the jump in output, pork prices have risen significantly from the end of November, reaching 47 yuan (C$9.23) per kg last week, almost level with a year ago.

“That’s the signal that there’s a very big shortage,” said Pan, adding that demand had not increased significantly.

The data also showed China’s pig herd rose to 406.5 million head at the end of December, from 370.39 million at the end of September.

Beef and lamb output rose slightly in 2020, by 0.8 and one per cent respectively, the data showed, while poultry output grew by 5.5 per cent.

— Dominique Patton is an agriculture and commodities correspondent for Reuters in Beijing.

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Wade Sobkowich, executive director of the WGEA, said the organization’s membership of major grain-handling companies are concerned their competitors could get a leg up if improper federal subsidies are provided.

He said he understands that rail access is an important service to the community of Churchill, but clear divisions must be made on what support Ottawa will provide. “That has to be clear — that federal funds are not going to private companies,” he said.

The WGEA represents grain handling companies responsible for hauling about 90 per cent of Western Canada’s bulk grain exports.

The Hudson Bay Route Association (HBRA), a supporter of the northern rail line and the port at Churchill, doesn’t see a problem with such funding, if certain conditions are followed.

HBRA second vice-president Wayne Bacon said the federal government has in the past subsidized shipments on the rail line by $9 per tonne in the days following the end of the Canadian Wheat Board’s monopoly on Prairie wheat and barley.

With that incentive, he said, even large shippers such as Richardson International used the Churchill line.

“I don’t think it can be specific funding just for, say, two or three different companies to use, but I think if it’s open for anyone to use, I don’t see the problems.”

Bacon, who also operates Northern Lights Railway and farms near Kinistino, Sask., said the reopening of the Churchill rail line and port could be a boon to local short lines through central and northern Saskatchewan and Manitoba.

Government incentives are going to be critical in the early going, he said, to find capable people to operate the facilities.

But Sobkowich said the situation can become complicated if subsidies are paid to an enterprise that will then compete with existing export terminals.

“If the government is propping up the rail line to get grain for export, it gets pretty messy to try and figure that out.”

Large grain companies have excess capacity at Thunder Bay, Ont., he said, and federal money that supports a company that will draw business to Churchill, away from existing terminals is unfair.

WGEA members are interested in using their own terminal spaces at Thunder Bay and the West Coast, and have no assets in Churchill, he said.

“The future of the (Churchill) port for grain exports, the opportunities are probably limited,” he said.

However, Bacon said he thinks grain companies will take advantage of Churchill, especially if there is a freight rate subsidy. He added he found it difficult to find space for producer cars at Thunder Bay.

Arctic Gateway Group, a public-private consortium, has bought the rail line leading to Churchill, the Port of Churchill and a nearby petroleum storage compound. Arctic Gateway is made up of grain and pulse processor AGT Food and Ingredients and Fairfax Financial Holdings, which together own 50 per cent. Missinippi Rail Limited Partnership owns the other 50 per cent.

The sale price was not disclosed.

In a news release, the president of Fairfax said Ottawa has already promised long-term assistance, although details were vague.

“The government of Canada acknowledges the value and importance of our inclusive group and is supportive of our efforts providing a long−term support package through Western Diversification and Export Development Canada” Paul Rivett, president of Fairfax Financial Holdings, said Tuesday.

The facilities were bought from OmniTrax after the Denver-based shortline rail operator, owner of the railway and port since 1997, said it could not afford to fix the rail lines, which were damaged by flooding and washouts in 2017.

Since the sale to Arctic Gateway, repair crews have been dispatched with hopes of getting the line operational before winter.

— Terry Fries writes for Commodity News Service Canada, a Glacier FarmMedia company specializing in grain and commodity market reporting. Follow CNS Canada at @CNSCanada on Twitter.

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Strong U.S. sales this year of the highly profitable big trucks have helped offset lagging passenger car sales.

But it is not clear how much of the truck demand is linked directly to ample factory incentives and dealer discounts, or how far sales might decline without those subsidies.

A Reuters survey of Ford, General Motors’ Chevrolet and Fiat Chrysler Automobiles’ Ram truck dealers across the U.S. indicates stores are offering deep discounts on some of the country’s best-selling full-size pickup trucks.

“The walls are not crashing down on full-size trucks,” said Sam Fiorani, vice-president of global vehicle forecasting at AutoForecast Solutions in Chester Springs, Pennsylvania. Detroit-based automakers want to keep cranking out their high-margin trucks, he added, and “giving up a little of the profit is the cheapest way to do it.”

Stores are offering discounts of up to $12,000 on the 2018 Ford F-150, which remains the best-selling vehicle in the country, recording more than 80,000 sales in May (all figures US$).

Discounts run up to $13,000 on the 2018 Chevrolet Silverado and as high as $16,000 on the Ram 1500.

Average transaction prices for full-size pick-ups range from around $42,000 to $45,000, industry analysts and automakers say.

All three companies are spending furiously — GM and Fiat Chrysler to help sell off carryover 2018 trucks to prepare for redesigned 2019 models, and Ford to sustain its long-held sales crown.

A supplier fire that temporarily shut down production of the F-150 last month “changed the game,” said Jeff Schuster, senior vice-president of forecasting at LMC Automotive in Troy, Michigan.

The supply halt nudged Ford’s crosstown rivals “to ratchet up incentives on the current models to go after weakness at Ford,” he said.

Deals advertised on the companies’ official websites range from rebates and low-interest loans to ultra-cheap lease rates, but they are not telling the whole story.

Ford, for instance, advertises a $2,000 rebate and a $500 financing credit on sales of certain F-150 models.

But James Collins Ford in Louisville, Kentucky, is offering discounts of up to $12,215 on the 2018 F-150 XLT SuperCrew 4×4.

The price cuts are even steeper at a number of GM and Fiat Chrysler dealers.

Quirk Chevrolet is selling the 2018 Silverado 1500 Double Cab at $13,000 off sticker. Gurnee Chrysler Dodge Ram Jeep outside Chicago is marking down the 2018 Ram 1500 Harvest Crew Cab 4×4 by up to $16,000.

— Paul Lienert is a Reuters correspondent covering the U.S. auto sector from Detroit.

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The amount that state agencies guarantee to buy at pre-set prices will double to 190 billion rupees (C$3.7 billion) for a five-year period ending in 2021-22, government spokesman Frank Noronha said in a tweet.

India is the world’s biggest edible oil buyer and frequently imports pulses, or lentils, because many Indian farmers tend to swing from one commodity to another depending on government incentives, leading to oversupplies one season and shortages in the next.

The government has been seeking ways to encourage farmers to invest in those commodities.

“This will help in protecting the farmers producing these commodities from making distressed sales during peak arrival periods and to provide remunerative prices with a view to encourage higher investment and production…” Noronha said.

Prime Minister Narendra Modi has been trying to cut India’s edible oil import bill of more than US$10 billion a year, but consumption has far outpaced demand in the country known for its love for deep-fried food.

India imports vegetable oils mainly from Indonesia, Malaysia, Brazil and Argentina. Pulses are bought from Australia, Russia, Tanzania, Canada and the U.S.

— Reporting for Reuters by Krishna N. Das.

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The Canada Organic Trade Association on Wednesday released data showing 5,053 certified organic operations in Canada, accounting for 2.43 million acres of land, at the end of 2015 — a 1.5 per cent increase in acres from 2014.

Over half of Canada’s organic operations are in Quebec, Saskatchewan and Ontario, COTA said, with 63.8 per cent of organic acres in pasture, down slightly from 65 per cent on “significant increases” in vegetable and root crop acres, and in fruit and nut acres.

Of Canada’s certified operations in 2015, 4,045 are considered “primary producers” with another 294 now in transition, plus 618 organic livestock operations and 1,542 organic processors, manufacturers and retailers. (Organic “operations” may fall into more than one of those categories, COTA noted.)

Canada, however, also imported at least $652 million worth of organic products in 2015, a total COTA said is up 37 per cent from 2012.

Furthermore, organic retail sales in Canada are now worth $4.7 billion annually, representing a 13.6 per cent increase per year since 2007, COTA said.

“Our organic agricultural production in Canada cannot keep up with the exponential growth of the demand, this is resulting in an increased reliance on import organics,” COTA’s Ottawa-based executive director Tia Loftsgard said in a release.

“Our government must introduce incentives to encourage farm operators to transition to certified organic agriculture,” Loftsgard said, noting both the European Union and U.S. already have programs and policies that “incentivize” farmers to transition to organic.

Those programs fit into “Green Box” criteria at the World Trade Organization and thus would be allowable subsidies under the WTO’s Agriculture Agreement, COTA said.

The Canadian Organic Standards call for farmland to be managed according to organic practices for a three-year transition period before a harvested crop can be marketed as “organic.”

Some provincial governments have previously offered supports to organic producers during the transition period. Quebec, for one, recently extended its organic agriculture conversion support program to the end of March 2022.

The latest numbers from COTA, Loftsgard said, also show the organic sector “continues to rely on the voluntary disclosure of data by certifiers and provincial organizations. In 2016 we finally have universal participation, resulting in the most rigorous production data yet.”

That said, “year-over-year change and inconsistencies remain a risk until a national mandatory data system has been implemented.” — AGCanada.com Network

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