ETHANOL is all the rage on the Prairies and in almost every agricultural area around the world.
Supporters believe ethanol is the vanguard of a bioproducts revolution that will rescue farmers from low incomes.
Ethanol is the most developed and easiest to implement technology in a wave of innovation that will yield biodiesel, bioplastics, textiles and other products now produced from petrochemicals.
Ethanol proponents say a mandated Canadian 10 percent biofuel blend would require about 20 million acres of crop production, reducing surplus grain production capacity, raising grain prices and creating jobs that would stabilize rural communities.
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The documented rural benefits of ethanol’s booming development in the United States show there is an opportunity for Canadian farmers.
But the way in which the opportunity is developed is critical to whether it truly benefits farmers or becomes just another industry benefiting from the labour of producers locked in commodity production servitude.
Farmers’ role in the ethanol industry must not be limited to being a supplier of grain feedstock. Ethanol demand might temporarily cause grain prices to rise, but that would encourage more grain production that would eventually pressure prices back down.
The laws of free enterprise will reward plants that seek to keep costs, including grain feedstock, as low as possible.
To fully participate in the rewards of this new industry, farmers must be able to share in its profits.
And that means ownership.
The past Liberal government had an ethanol incentive program that allocated $118 million to 11 proposals. Few farmer owned projects were approved.
Some money went to an oil company whose profits last year doubled to a record $2 billion, and some went to projects in Ontario that would rely for part of their corn feedstock on U.S. grain.
If the current government decides to support ethanol plant development, the programs must be designed to promote an industry that benefits rural communities and farmers.
There is no shortage of grassroots, farm-based proposals. They need government assistance because, after years of low or no farm income, money is tight in the country. But rather than deciding who wins and loses through a grant allocation process, governments should design incentive programs available to any group that meets criteria related to farmer and local investment.
Federal agriculture minister Chuck Strahl has promised a biofuel strategy and has indicated he realizes the need for farmers to be part of the production chain. He and his government must get the policy right because it has the potential to partly address long-term farm income problems.
If he gets it wrong, he’ll face more years of placard carrying farmers demonstrating on Parliament Hill for more support, while the benefits of the bioeconomy boom pad the profits of multinational corporations.
