Farm income projections haunt Ont. government

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Published: March 22, 2007

TORONTO – For a provincial government facing an October election in Canada’s largest agricultural province, farm income projections for 2007 could hardly have been good news.

Agriculture Canada projects that rising costs and declining profits in sectors that use high-priced grain for feed will drag Ontario’s realized net income down to a negative $200 million this year.

Gross market receipts are projected to be more than $9 billion.

To win re-election, the Liberal government will need to hold many of the rural seats it won in 2003’s election. Unfortunately for the government, an economically depressed countryside does not usually translate into voters happy with the status quo.

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However, Ontario agriculture minister Leona Dombrowsky said those projections are too pessimistic.

“There are reasons in Ontario why we can be hopeful,” she said.

“I think particularly the news with respect to the U.S. second rule being contemplated in the United States will have an impact on the ability of our cattle over 30 months to cross the border. It is our hope that will happen this year and I believe that is going to have a significant positive impact.”

Dombrowsky said a provincial government commitment to promote buying Ontario-produced food in the province will create markets and raise prices.

As well, she said that based on feedback from the industry and a March 8 recommendation from the minister’s Strategic Advisory Committee, the government is going to push aggressively for regulatory reform in the province and across Canada.

She said she has talked to federal agriculture minister Chuck Strahl, and the issue will be on the agenda for an April federal-provincial ministers’ meeting.

Dombrowsky cited meetings with pork producers who complained that restrictive rules on veterinary drugs available in Ontario are making them less competitive with other jurisdictions where those products are allowed.

The minister said she will promise and promote regulatory reform that makes life easier and business more profitable for farmers.

“The current regulatory requirements are costing them money,” she said.

The advisory committee that prepared the report on reforming policy to help agriculture made eight recommendations, many of which will be familiar to anyone who has followed the debate about the need for “smart regulations.”

“These recommendations will likely carry the greatest currency with stakeholders,” the report said.

It also offered proposals to target aid to biofuel development, encourage the organic sector, brand Ontario farm products and promote Ontario products to domestic consumers.

But for all the talk of promoting prosperity through innovation and promotion, Ontario Federation of Agriculture president Geri Kamenz quickly said some old-fashioned solutions are also required.

The provincial government should increase agriculture spending in its budget March 22.

“We can’t win the innovation race from the hole we are starting from,” Kamenz said in a statement issued after the advisory report was published with enthusiastic comments from the government.

“Our industry needs strategic investment to jump start those sectors of agriculture that have not been profitable.”

He said several of those sectors, notably grains and oilseeds, have designed risk management programs that would give them stability, but they need provincial financial support to function.

Dombrowsky has been negotiating with farm leaders over details of a proposed new provincial companion program, but she said last week Ottawa’s vague new promise of support without details has complicated the ability to act.

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