Organic grain growers are bewildered by reports they are failing to meet market demands.
A new study by Canadian Organic Growers shows that despite soaring demand for organic goods in grocery stores, the number of certified growers on the Prairies has remained stagnant and organic production continues to represent less than one percent of total agricultural output.
Those are worrisome findings for Laura Telford, executive director of Canadian Organic Growers, who said supply is not keeping up with demand, which is growing at a double-digit pace.
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“It seems to be the farmers that are holding us back. They are really reluctant to transition,” said Telford when asked to interpret the results of the group’s annual survey that showed 1,700 certified organic farmers in the prairie region in 2005, down slightly from 2004 levels.
She said government programs are needed to encourage more farmers to make the transition into organics to boost supply to adequate levels.
Dwayne Woolhouse, the Organic Crop Improvement Association’s 2006 farmer of the year, said that is a bad idea.
“We don’t need more farmers. Not out in Saskatchewan anyway,” said the grain grower from Assiniboia, Sask.
Adding more production would only further depress already disappointing prices, he said.
“The prices aren’t good. A lot of farmers are not selling.”
Dwayne Flaman, who grows organic flax, lentils, peas and wheat on his farm in Vibank, Sask., doesn’t see the overwhelming demand Telford and others speak about.
“It’s getting harder and harder to market our grain as the years go on,” he said.
Flaman’s regular buyers tell him they are not looking for grain right now. One of them said farmers are overproducing.
A case in point is the French small green lentils languishing in Flaman’s bins.
“I used to get phone calls every year saying, ‘Do you have these?’ Now I can’t move them. They’re almost becoming worthless.”
The 33-year-old farmer is considering getting out of organics. The only thing keeping his operation afloat is his conventional cattle herd.
Flaman is irked by reports of a shortage of supply amidst what he sees as slumping demand and lackluster prices.
“As of this week I was ready to pack it in,” he said.
Simon Weseen, organic trade and market analyst at the University of Saskatchewan, suspects low-cost grain producers such as China, Eastern Europe, Argentina and Brazil may be filling demand that used to be supplied by Canadian product.
Another factor to consider is that much of the soaring demand for organics is at retailers like Wal-Mart for items like fruits, vegetables and dairy.
“That is not the demand that we’re really satisfying with the types of products we produce here,” said Weseen.
Woolhouse contends there is more to slumping prices than those two factors.
Buyers are also undercutting growers, preying on new entrants who jump at wheat prices slightly higher than the conventional prices they are used to seeing, rather than holding out for a more adequate return.
He said the industry needs some type of price discovery mechanism so growers have a better idea of a reasonable value for their grain.
Weseen said there is a service available through the University of Saskatchewan at organic.usask.ca/
pricedata.htm that lists the yearly high, low and weighted average price for organic commodities.
Price data is compiled by the Saskatchewan Research Council, which receives funding from the university, the Organic Agriculture Centre of Canada and Saskatchewan Crop Insurance Corp.
Results for 2006 are expected to be posted some time in February.
