Farmers face tilted market

Looking across the southern border has always created a sense of frustration for farmers on the Canadian Prairies.

American farmers have long had it better. Americans’ provide more financial support for their producers. Average farm acreage in Canada has always been larger than in the U.S. neighbouring states because margins were smaller north of the border.

The current China-United States trade problems as they relate to agricultural products is no exception. The negative effects on agricultural commodities in Canada will not see the same level of compensatory subsidy or assistance as in America.

In Canada, we are being punished by China for defending the rule of law. American farmers are being hurt, at least in part, for supporting a political leader who believes in trade wins rather than agreements. But U.S. President Donald Trump also believes in using the public treasury to defend sectors injured by his actions.

The U.S. Market Facilitation Program, designed to assist producers injured by the Chinese tariffs, is now worth north of US$15.9 billion. This week the first, and biggest of three payments arriving in farmers’ bank accounts.

At a minimum, it is $15 per acre, up to $150. For farmers who couldn’t plant because of wet conditions this spring it is $15. Hogs are $11 per head, dairy is 20 cents per hundredweight. It is similar to the tariff-fight subsidies paid in 2018, but based on the 10-year average, rather than 2017 sales. That pushed payments higher because it includes the ag-commodity bubble and years where the U.S. sold more farmed products to China. For example, in most of Montana, the payment is $15; North Dakota $15 to $57; Idaho $15 to $30; Minnesota is as high as $76. Visit producer.com for the list.

There are three compensated categories. Non-specialty crops such as alfalfa, barley, canola, corn, oilseed crambe, dried beans, dry peas, cotton, flax, lentils, rice, millet, mustard, oats, peanuts, rye, safflower, sesame seed, chickpeas, sorghum, soybeans, sunflower, triticale and wheat. Specialty crops, mostly berries, fruits and nuts, and hogs and dairy.

Farmers may claim $250,000 for each, up to $500,000 and this year can claim it without limits of their income, provided 75 percent of it comes from farming.

Canadian farmers compete in a global market distorted by subsidies. That old free-market to the south was never free, Canadian farmers have been paying for it every day.

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