OTTAWA – Input costs faced by Canada’s farmers are not out of line with costs faced by their competitors, a senior Agriculture Canada official recently told MPs.
“Our bottom line on fuel, chemicals and fertilizer is that we feel Canadian producers are getting comparable prices to their competitors,” said Tom Richardson, director general of the farm income policy and program section.
“We don’t see any kind of systemic discrimination in the prices producers pay.”
He was offering the department’s analysis of why prices for those three inputs have soared this year, raising the ire of some farmers and raising input costs as a political issue.
Read Also
Land crash warning rejected
A technical analyst believes that Saskatchewan land values could be due for a correction, but land owners and FCC say supply/demand fundamentals drive land prices – not mathematical models
The Commons agriculture committee has launched public hearings into the matter.
Richardson said he was not commenting on whether the prices are justified, whether there is sufficient competition or whether prices should be lower. He only offered evidence that price increases are not unique to Canada.
Differences in fuel prices mainly are the result of different tax levels, he said.
Fertilizer prices have been soaring because demand is up as farmers expand production to capture higher market prices.
Chemical pricing levels are more difficult to explain, but for many of the more popular chemicals, prices are lower in Canada than in the United States, said Richardson.
Cheaper than in U.S.
“In many cases, the reality is that Canadians are paying less than their American competitors.”
He cited a study which compared herbicide prices in Ontario and Michigan. It showed Roundup prices more than 47 percent lower in Canada.
MPs, who earlier had heard evidence from Canadian Federation of Agriculture head Jack Wilkinson about the impact on farm profits of escalating input prices, seemed skeptical at times.
Ontario Liberal Murray Calder wondered how farmers can know if there is collusion between suppliers to set prices higher than necessary.
“Always a question to ask is how do you prove people are getting together,” said departmental official Allan Asselstine. “We can’t prove it or disprove it.”
Next week, MPs begin to call representatives from the manufacturers to explain their pricing policies.
