Know what’s in your grain contracts and make sure they protect and reward you as much as they protect and reward the buyer.
That was advice from a seasoned sunflower marketer, speaking at CropConnect, to farmers thinking about contracting the crop.
It makes a lot of sense because farmers can end up on the delivery hook with grain companies that can squeeze them ruthlessly unless their contract offers some protection.
That advice was also being given to Canada about the North American Free Trade Agreement by former Prime Minister Brian Mulroney, who agrees with the federal government’s policy that no deal is better than a bad deal with the U.S. Any contract that lets the U.S. squeeze Canada at will isn’t worth signing.
Mulroney almost let the 1988 Free Trade Agreement fail, he says, when the U.S. appeared to refuse to allow Canada to protect its interests. He’s sure the present Liberal federal government has some items it’s also committed to, and it has said that is the case.
Like a farmer dealing with a grain company, Canada is a much smaller and weaker entity than the United States. That could make somebody argue that the smaller player can’t expect to force demands on the bigger player, and that any deal should be taken as better than no deal, especially if the small player is dependant on the bigger player.
It’s heartening to see the Justin Trudeau government, fronted by Foreign Affairs Minister Chrystia Freeland, refusing to be panicked by the Donald Trump administration’s belligerence and hectoring. It must be an anxious situation for Canada’s trade politicians and negotiators to stand up to — and ignore — frequent attacks and insults and belittlements from Trump.
However, so far they seem to be sticking to their guns and refusing to be baited into tit-for-tat rhetoric, something journalist and former Republican White House aide David Frum has praised.
As well, Freeland and Trudeau have said they won’t sign on to a bad deal: no deal is better than a deal that enshrines an unfair situation.
So they’re playing for time and refusing to be buffaloed.
At CropConnect, I and a handful of other journalists got to talk with Mulroney after his speech to farmers, and I asked him about what U.S. demands Canada can never accept.
He wouldn’t tell the Trudeau government, to whom he is occasionally an adviser, what they can’t do, but he told us a story about how he took the 1987 free trade negotiations to the point of failing over a demand he wouldn’t drop, despite U.S. insistence.
According to Mulroney, he told the Americans he needed a dispute settlement mechanism that would prevent the dice being loaded against Canada if a trade fight began. Former President Ronald Reagan’s chief of staff, James Baker, told Mulroney he couldn’t do it. Mulroney was willing to let the whole thing fail (Reagan’s limited ability to approve the deal was expiring in a few hours), and threatened to use his shamrock power to move the president if Baker couldn’t deliver the deal.
It got delivered.
It’s good to see that the present Liberal government has a similar toughness when approaching the NAFTA renegotiations.
It’s like being a farmer dealing with a grain company: you’re supposed to be partners, and if both sides can’t protect themselves and prosper, there’s no deal to be made.