Prairie farmers face their most bleak financial year since the gloomy days of the export subsidy wars more than half a decade ago, the leaders of the three prairie pools have warned federal politicians.
“The Canadian Wheat Board’s pool return outlook for the 1998 wheat crop is about $140 per tonne or $3.80 per bushel at the farm gate,” the pools said in a plea to MPs made during an early-October lobby trip to Ottawa.
“After covering the basic costs of producing the crop (seed, fertilizer, fuel, crop protection, machinery repair), there will be very little left to pay taxes and provide for families. It is very unlikely that capital investments will be made at all.”
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So far, there has been little federal response to the growing clamor for recognition and action on the farm income issue, but they think that may be changing.
“I think maybe now, the message is finally starting to sink in,” Saskatchewan Wheat Pool vice-president Marvin Shauf said in an Oct. 14 interview.
The pools called on the federal government to freeze service fees, spend more money on safety nets and work with the provinces to develop a national disaster assistance program.
Already, in the face of low prices and continued subsidies by the European Union and the United States, wheat acreage has been cut to a 20-year low.
And the pressures are getting worse as Canadian farmers feel abandoned by governments while watching their competitors receiving billions of dollars in help.
“Prairie farmers are well aware of the fact that Canada cannot compete with the treasuries of countries like the United States and the EU,” said the PPI brief. “However, it appears that trade agreements, which were designed to allow the marketplace to function are not sufficient.”
The companies calculate that European farmers receive $175 (Cdn) in support for every acre planted. This year, they also receive a guaranteed price of $205 per tonne, well above market prices.
In the U.S., farmers receive $24 per tonne in direct support under the farm bill and Washington plans to ship out between $4 and $7 billion (U.S.) in additional subsidies this autumn, said the brief.
“In contrast, prairie farmers do not benefit from these kinds of support programs,” said the pools. “Farmers in Alberta, Saskatchewan and Manitoba received about $600 million in total federal and provincial program payments in 1997.”
They noted that in 1997-98, Canadian farmers paid more than $138 million in fees for government services and this year, fees are expected to rise for many services. Already, service fees are 28 percent higher than they were three years ago.
The pools urged Ottawa to use trade negotiations to pursue more open borders and an end to export subsidies.
They also suggested the federal government be more aggressive in standing up to American trade restrictions, such as the increased inspections of Canadian trucks started by some northern states this autumn. Ottawa should even consider trade action of its own against the United States.
The state tactics have been suspended while the two countries discuss trade grievances.
“We have to impress on the U.S. that Canada cannot and will not be used as the pawn in U.S. political battles,” said the pool brief. “We encourage the government to identify all possible actions that can be taken in the event (of) unfounded U.S. trade harassment, including the facilitation of legal challenges and investigating the potential for trade sanctions.”
