Farmers need more carbon tax analysis

Last week’s front-page story by Robin Booker was a substantial piece. After filing a series of requests through the federal Access to Information Act to determine what, if anything, the Canadian government had done to determine the effect of the pending carbon tax on farmers, Robin searched through a mountain of information to determine that ultimately, despite several attempts at producing reports, conclusive effects of the carbon tax on farmers were hard to find.

The Western Producer has long argued two things:

  • That farmers are price takers because any increase in costs are ultimately passed along to them and they do not get to pass them along. They are the end of the line.
  • That farmers have already done much of what can realistically be done to curb carbon and methane emissions.

It’s worth reiterating what Booker found in one 73-page report prepared by Agriculture Canada officials in December 2017 on the potential for farmers to adjust their practices to reduce carbon emissions. A report called “Climate Actions in the Agriculture Sector” was provided to deputy minister of agriculture Chris Forbes. It concluded that “using current technologies, significant reductions (in carbon emissions) would be only possible by scaling back production, which is not a practical, realistic scenario given increasing global demand for food and growth expectations from the Canadian agriculture sector.”

A carbon tax’s raison d’etre is to encourage behaviour change that results in a lower contribution to climate change.

Agriculture Canada seems to understand that is not realistic for farmers, yet we were unable to find the effects of the carbon tax on the cost of fertilizer. Farmers will not pay a carbon tax on fertilizer, but the process of making fertilizer will be subject to the tax, making it more expensive.

As well, we do not know the cost of moving grain by bulk rail.

And while farmers won’t pay the carbon tax on farm fuel, the cost of fuel is likely to increase.

There have been several reports for Ag Canada on this issue, but none have got to the bottom of the story.

There is room for one more report, fully public, at the very least determining the cost of fertilizer, rail transportation, fuels, heat and electricity on Canadian farms.

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