Canada’s food processing sector is being stifled by labour shortages, a lack of investment and policies that discourage innovation, says a document from an Ontario think-tank.
The document, prepared by the George Morris Centre in Guelph, Ont., said other problems include chronically low incomes for farmers, lagging productivity in the food manufacturing sector and managers that don’t measure up.
The criticisms are part of a draft food policy proposal that was discussed at focus groups this summer.
“Managers at both farm and processing levels lack management skills and in many cases seem not to understand the value of having them upgraded,” said the summary sent to focus groups. “The fundamental result of these factors is that the sector has too little labour available (and) it needs better training for its labour and better management skills.”
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The analysis portrays the agriculture and food sector as something of a world backwater lagging in investment for equipment and capital innovation, pursuing trade policies that benefit protectionists rather than exporters who can expand the industry and saddling industry with regulations on marketing and product approval that deny Canadian farmers and companies the ability to innovate.
“Policy needs to work toward a clear vision of the sector we want to create,” says the overview report.
A revised policy proposal reflecting focus group feedback is to be ready by autumn. It is meant to develop a food industry policy that encourages profitability at all levels after years of low farm incomes.
The initial analysis suggests Canadian regulations that restrict farmer marketing options should be reconsidered and bureaucratic rules that govern food labelling and farm input availability should be improved to integrate more with foreign product assessment.
The report reiterated complaints about the performance of bureaucracies that regulate pest management products and veterinarian drugs while acknowledging some progress at the Pest Management Regulatory Agency under new management.
“Given that Canada is, in the case of pesticides, a fundamentally minor use economy, the cost of regulation is a disincentive for suppliers to invest in research and even to register products in this country,” it said.
The working paper for focus groups also questioned Canada’s tendency to deal with corporate concentration by regulating big players and subsidizing smaller competitors, particularly if they are farmer owned or a co-operative. Support for farmer or co-op projects was a central part of the government’s policy in 2004 and 2005 to encourage increased packing plant capacity during the BSE closed-border crisis.
The centre’s report noted there is a history of distrust between sectors of the industry that must be overcome.
