Low production and low prices in 2005-06 have left the Saskatchewan Mustard Development Commission with less money to spend on research.
Figures presented during the commission’s annual meeting last week show that 2005-06 revenue from the commission’s producer checkoff declined by 31 percent from the previous year.
The commission collected $123,919 and returned $2,719 to producers in refunds, for net revenue of $121,190. The previous year, net revenue from the voluntary checkoff was $173,364.
Commission director David Pederson said the big drop in check-off revenue was due to two factors: a decline in volume, which was accompanied by a drop in price.
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According to Agriculture Canada, mustard seed production was 43 percent lower in 2006, while prices in 2006-07 were down by about 10 percent.
Unlike most producer checkoffs, which are based solely on tonnage, the mustard commission also takes price into account.
Its checkoff is set at 0.5 percent of the value of the farmgate sale as submitted by the buyer, a system Pederson described as more affordable.
“You don’t want to pay the same levy when you’re getting 10 cents a pound as when you’re getting 20 cents,” he said. “So the amount you collect is partly a function of price, and the price really sucked.”
Based on budgeted 2005-06 revenue of $161,600, the commission had planned to spend $75,000 on research and development projects, but due to the reduced income it was able to direct only $39,652 for that purpose.
In its budget for 2007-08, the commission is projecting net check-off revenue of $147,500.
“I hope that’s a really conservative figure,” said Pederson.
Spending on research projects is budgeted at $71,100, which includes projects ongoing from previous years. About $20,000 remains uncommitted.
