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October 9, 2012

Growing Forward 2: a re-shaping of public policy at what cost?
By Doug Chorney

Farmers and the general public should be seriously pondering the long-term effects of the federal-provincial-territorial Whitehorse agreement on Growing Forward 2 signed last month.

As producers get over the initial shock of the obvious – the realization that the government consultation process was nothing more than window dressing, that the new AgriStability program is only going to provide half the protection as the present one, and that AgriInvest has been chopped by one third – a picture is be ginning to emerge in my mind of what the future may hold.

Primary production is a risky business – but an absolutely necessary one – and governments in the past have long recognized this. Even the most astute farmer cannot prepare for the consequences of bad weather, commodity price drops, or trade issues – and government programming has evolved over the years to try and mitigate the effects of these problems so that food production in our country could remain strong.

I am concerned about what will happen when the current high grain prices cycle back down (as they always do), or when floods, drought or the effects of climate change threaten to put many producers out of business. I fear there will be no effective backstop that will keep farmers in the business of producing food.

Business risk management programming was that backstop. But now, governments have decided that BRM programs – AgriStability in particular – mask market signals and inhibit innovation.

The new Growing Forward 2 framework, with its undefined plan to drive innovation and competitiveness at the cost of less BRM support, fails to explain how innovation and competitiveness could serve an industry experiencing distress. Investing in R and D that farmers might not be able to adopt due to financial uncertainty doesn't get the industry further ahead.

Instead, we could be looking at a decline in primary agricultural production that may well leave Canadians wondering how to access a safe, secure food supply.

Some industry observers would have the public believe that farmers were getting rich on AgriStability – buying up land, new machinery, and new buildings – and making more money than most other Canadians.

In fact, it is the need to remain competitive in an ever-changing marketplace that has necessitated an increase in farm scale and an embracing of new technology and productivity – which require significant investment by farmers. Suggesting that this somehow makes them rich shows a lack of understanding of primary production; suggesting this can be done through AgriStability is quite preposterous.

I might add that the investment in and the use of new technology is one of the biggest strengths of agriculture. The very nature of independent farm operators who are able to quickly adopt new technology without cumbersome process puts food production well ahead of most other industries. Here in Manitoba , we see great efforts to diversify farm income and try new crops, with soybean production held up as a great example of this effort.

Canadian farm debt numbers speak loudly to this issue of farmer investment. The farm debt has risen to over $66 billion, according to Statistic Canada 2010 data.

Anyone who has been enrolled in AgriStability can tell you that when qualifying for a payment, there is absolutely no financial flexibility to start expanding the farm! It is usually a case of survival to the next production cycle and a hope of restoring profitability for t he enterprise.

Furthermore, consecutive years of declining margins – as has happened before in crop production and is happening now in livestock production – gives farmers almost no protection, let alone allowing for unnecessary expenditures.

Producer s and farm groups knew that revisions were coming to the AgriStability program, and we were hoping that we could work with governments to make it more effective for us and more palatable for them. After all, we were certain that the concept of sector supports was here to stay – as a cornerstone tool that could ensure a vibrant and profitable future for food production and food producers in this country.

Our young farmers were counting on a commitment to these principles. Instead, they got a gutted program that is about nothing more than pulling supports in the interest of budget cutting.

Farmers and all Canadians need assurances that public policy will reflect the critical importance of food production and food producers in this country. A safe, secure food supply and the one-in-eight jobs linked to the agri-food industry are riding on it.

Doug Chorney is a farmer from East Selkirk, Manitoba, and president of Keystone Agricultural Producers, Manitoba's largest general farm policy organization. It represents over 7,000 farm families and 23 commodity groups throughout the province.


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