We’re so used to them being twisted, perverted, distorted and contorted, our ag markets seem normal to us

I was flipping back through my notes from the past month and a common thread appeared when I saw these subjects:

* China and Russia suddenly expressing concerns with ractopamine and imposing various restrictions on beef and pork, even though scientists say there’s nothing to fear with the substance.

* China allowing more access to its market for Canadian canola seed, after some of its alleged concerns about blackleg have been alleviated. But tight restrictions still cap the amount of canola seed that can be exported to China.

* Moroccan millers hoping that Canada can get a free trade agreement with their country so that the U.S. doesn’t scoop the market because they already have a free trade agreement with the Yanks.

* Country of Origin Labeling. U.S. continuing to try to cling to the trade-distorting influence on foreign cattle and pigs of the legislation, regardless of WTO tut-tutting.

* Free trade with Europe: lots of little wrinkles in our present trading relationship that add up to lots of trade distortion due to complex sensitivity equations within the European Union.

* Getting into the Japanese and South Korean feedgrain markets: demand there is high and high-paying, but getting in is very complicated and daunting because of stringent government regulations.

At meetings, conventions and in interviews I’ve done in the past month, the underlying and overwhelming cumulative theme has been trade complications and the endless efforts Canadian ag industries and governments are undertaking to iron those out.

It can seem a little daunting to me, a poor, ink-stained scribbler, when hearing this litany of obstacles, barriers, complications, struggles, battles, subterfuges, snags and snarls. It’s interesting to write about, but golly – our humble little prairie farmer grows and raises stuff that gets sold into markets that are unbelievably complex.

But the other theme that has risen above the cacophony of my notebook and the sea of shed ink therein is this: working diligently, unheroically, doggedly, steadily, unromantically and unceasingly, we can make our markets come a lot closer to the way they should be, which is free and open.

That’s what our politicians, bureaucrats, diplomats, corporate officers, farmer representatives, marketers do every day, and over time it seems to wear down the folks who are trying to block us, especially if, like the Americans and Europeans, at least want to appear to be desirous of free trade and open markets. I posted my thoughts on this last week, but feel compelled to do it again, because looking back through my notes, boy does it become obvious how important it is to grind away at obstacles, rather than forget about them or think there’s always just a grand political bargain that’s going to be struck to clear them away. I expect there are many countries that just ignore the problems and walk away.

I can’t imagine it’s been easy work for the canola folks and government folks to push open the door for more canola sales. It’s easy for China to shut the door and – in a vast country and communist bureaucracy like that – hard to get them to ignore our little issue. But if you buzz in their ear enough, I imagine in the end they just want you to go away, so they throw you a bit of rotten fruit to dine on for a while. (Cynics will say the Chinese simply open and shut access whenever they have brilliantly assessed this will have the specific market impact they wish for, so our efforts probably mean nothing, but I think that’s too cynical. I don’t think they’re that brilliant, and I do think dogged work tends to pay off.)

Ditto working with the Europeans. They don’t like providing access to our crops and meat. If we get more in an upcoming FTA, that’ll be due to a lot of bargaining.

I realize that in this post that I am once more being extremely non-journalistic and actually praising things and being optimistic, but there you have it: I’m getting soft and weak with the growing weight of the 47 years I carry about on my bowed shoulders.

I can still see across the Jordan the Promised Land, can glimpse the realm of free markets that most prairie farmers have been promised from on-high, can sniff the scent of the Balm of Gilead that will soothe our sores!

Because, after all, all most farmers and traders want is free and open markets. It shouldn’t be that difficult, but it is, because many special interests benefit when obstacles are put in place.

Our ag markets now – I say returning to my journalistic pessimism and professional skepticism – are so twisted, perverted, distorted and contorted – and have been for so long – that we just accept them as reality. Trade is a complicated mess and always will be. We accept that it’s an endless war to just make them only semi-screwed up, rather than completely messed. So when we read all this stuff, it just seems normal. We can’t really imagine what truly open markets would seem like.

(The world’s economies and stock markets are beginning to enter this realm now: central banks have been so aggressively and massively distorting world investment and economic output – deliberately – for so long now that many have just accepted the “new normal” as actually being normal. They won’t know how to compute in a world that doesn’t contain ZIRP and QEternity.)

We need to denormalize weirdness in our markets, and hopefully all this diligent work by so many folks will help that happen.

At least a bit.


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