Gov’t must assure quality in crop data collection

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Published: September 12, 2013

Markets need information like fire needs oxygen; one can’t survive without the other.

Buyers and sellers make decisions based on their understanding of supply and demand based on a constant stream of information.

The data in crop markets comes in many forms, including weather, seeded acreage reports, yield forecasts, seeding and harvest progress, the location of stocks, transportation data, domestic consumption and export pace.

Markets function most efficiently and fairly when the information is accurate and widely available. Prices are fair when they are a reflection of true supply and demand.

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Publicly available, government-produced information is especially important for the smallest players in the market: farmers who do not have the advantage of the private information that grain companies, processors and major traders can amass through their own handling systems or expensive advisory services.

One need only look to developing countries for examples of how farmers are disadvantaged by inadequate or unreliable public crop data.

So there is growing unease about apparent erosion to the publicly available information on Canada’s grain market.

Last year, the Canada Port Clearance Association, which co-ordinated grain shipments through Vancouver and Thunder Bay, closed down, ending a daily report on ship lineups at port that provided a window on grain exports.

As of Aug. 1, the Canadian Grain Commission no longer does mandatory in-bound weighing and inspection at grain terminals. Without first hand data, it can’t produce its weekly report on grain movement and exports.

Now, Statistics Canada proposes to end its September crop production farmer survey in favour of a mathematical model using remote sensing satellite data to generate crop size forecasts.

The agency says it won’t have to contact farmers for a survey during a busy season and will save $50,000 to $75,000 a year.

It says it will implement the proposal only if the survey and satellite data this year agree, indicating the latter is accurate. Other farmer surveys about seeding decisions and post harvest production would continue. We don’t know the impact of these changes yet.

The grain commission has begun to replace some of its reports by working with grain handlers, but has nothing yet on exports. It hopes to eventually provide weekly data on grain movement and exports that are an improvement over the old reports.

There is the potential that using new technology could improve Statistics Canada’s production reports. Analysts now complain that the delay between when farmers are surveyed and when the report comes out can lead to out-of-date information if there is a shift in the weather. Also, there is always the possibility that the data can be skewed if farmers are not truthful when surveyed.

Using satellite data to confirm the accuracy of the survey data or to provide more frequent updates through the growing season would be a welcome addition to Statistics Canada crop data.

However, to rely entirely on satellite data run through a computer model to generate a production report that can have a major effect on grain prices seems risky.

Also the remote sensing and computer model have generated yield outlooks for major crops such as wheat, but how accurate will it be for minor crops such as beans or canaryseed?

The proof of the pudding will be in the eating.

However, the objective in all these changes must be to improve the quality and availability of crop data, rather than simply fill a hole.

The Conservative government has delivered on a promise of marketing freedom, and now farmers must hold it to account to provide the accurate, unbiased data that make markets fair.

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