Targeting supply management, official with the Macdonald-Laurier Institute says Canada is losing global market share
Canada has what it takes to be a world agricultural superpower but is held back by an out-of-date federal agricultural policy, according to a public policy think-tank.
It has the third largest amount of arable land per capita in the world, which is more than double most of its competitors.
It has good quality soil, which is a distinct advantage over the heavily degraded soil in the most populated countries.
And nine percent of the world’s renewable fresh water supply makes it one of a few countries that is not experiencing water shortages.
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“Canada stands out as one of the best endowed nations on the face of the Earth,” said Brian Crowley, managing director of the Macdonald-Laurier Institute. “In spite of all this great endowment, we are losing market share in every major agricultural product except pulses.”
The tendency is to blame Canada’s reduced competitiveness currency risk and sprawling geography, which results in big distribution costs.
Crowley said there is another culprit.
“Canada’s ag policy is a product of six decades of food surpluses when productivity didn’t matter or was even discouraged,” he told the Canadian Global Crops Symposium.
“If the more likely prospect in the future is not food surpluses but food scarcity, it is more than time to rethink this policy approach.”
Ninety percent of total government spending on agriculture and food policy goes toward price income support when the economic benefit for dairy and poultry supply management is included in the calculation.
The Organization for Economic Co-operation and Development says Canada’s market support for agriculture accounts for 20 to 25 percent of gross farm income on average, which is well above competitors such as the United States and Australia.
Crowley said Canada’s agricultural policy focus needs to shift from income support to expanding productivity and exports.
The United States has signficantly outpaced Canada in productivity gains in just about every agricultural commodity and in the food manufacturing and food processing sectors, he added.
On the export side Canadian exporters are confronted by trade-stifling tariff and non-tariff barriers.
For example, the two factors combined amount to 300 percent on Canadian pork shipped into Japan.
He said it is why it is critical Canada be included in any Trans-Pacific Partnership agreement. If Canada is left out and the U.S., as rumoured, signs a side agreement with Japan, the impact on Canada’s livestock sector would dwarf the impact of U.S. country-of-origin labelling.
“It is absolutely vital to Canada’s interest, and we simply cannot allow supply management to stop it,” said Crowley.
sean.pratt@producer.com
