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FEBRUARY 15, 2018 | WWW.PRODUCER.COM | THE WESTERN PRODUCER
WPEDITORIAL
OPINION
Loss of market information terrible trend for farmers
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dam Smith, considered the father of modern economics, explained that an invisible hand will guide the marketplace if consumers and producers are free to make their own choices about what to buy and sell. Then the market will settle on an equilibrium that is beneficial to all. But what if the buyer has more information than the seller? What results is not equilibrium, but an economy tilted in favour of those who have the most information. That isn’t healthy. It’s not to say that situation will unfold entirely with the Canadian Oilseed Processors Association’s decision to end its weekly crushing reports, but we can start to see the slope, and it’s slanted against farmers. The COPA report gave crushing numbers and capacity of utilization — matched against the previous year — of canola and soybeans. These are important technical signals of the marketplace that farmers can use to determine whether to sell or hold their grain. Farmers can use the information to confirm their market analysis based on the spread of basis points. It’s the incremental loss that smarts. COPA will still produce a monthly report. Monthly statistics are published by Statistics Canada, and the Canadian Grain Commission produces a report on grain movement. Yet the timeliness of the weekly COPA canola crushing report made it more relevant. By the time the monthly numbers come out, it may well be that the markets opportunity presented by the numbers has passed. A COPA spokesperson said the organization decided to streamline its priorities, and the weekly report was a low priority. No doubt. The loss of this timely market information puts Canadian farmers at a disadvantage compared to farmers in the United
States, who have more timely data. Ken Ball, a senior commodity futures adviser at PI Financial in Winnipeg, told the CNS news agency that Canada has “dramatically less amount of timely, current, pertinent information compared to what we get on the U.S. markets.” That matters. COPA’s members include Archer Daniels Midland, which is reported to be in talks to buy Bunge (also a COPA member), Louis Dreyfus, Richardson (which recently pulled its funding from oilseeds groups), and Viterra (which was bought by Glencore in 2012). You can see what’s going on — fewer, bigger companies, less information and pressure to acquiesce through removal of financial support. Consolidation throughout the agriculture industry should not be coupled with less information for farmers. At that point, the invisible hand starts to close on producers and crushing takes on a whole new meaning. The federal government has largely stayed silent on massive mergers in the industry, allowing companies worth tens of billions of dollars to swallow up companies also worth tens of billions of dollars, so long as certain divisions are sold off to maintain some degree of competition. The age of globalization has ushered in this economic climate, but farmers shouldn’t be handcuffed with less information. If these giant companies must merge, key markets information must be made available to farmers on a timely basis as part of the stipulations of government approval. That must be a condition of every merger agreement in the agricultural sector.
CRAIG’S VIEW
WOMEN ON BOARDS
Bruce Dyck, Barb Glen, Brian MacLeod and Michael Raine collaborate in the writing of Western Producer editorials.
This debate over gender balance really detracts from the conversation we’re trying to have about the importance of diversity and ways to make it better. I want to know that I’m there for my skills, experience and value, and I know that’s the case with this position. HANNAH KONSCHUH, NEWLY ELECTED DIRECTOR TO ALBERTA WHEAT COMMISSION, PAGE 17
New agricultural programs expected ahead of schedule CAPITAL LETTERS
KELSEY JOHNSON
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ttawa is getting ready to roll out the Canadian Agricultural Partnership ahead of its April 1 implementation deadline. The Canadian government and the provinces agreed to the fiveyear CAP when agriculture ministers met for their annual federal-provincial-territorial meeting last July. The agreement, once implemented, will replace the current $3 billion Growing Forward 2, which is set to expire at the end of March. Agriculture Minister Lawrence MacAulay was set to announce
new details about the CAP framework and its programs Feb. 13, after deadlines for this issue, as part of the Agriculture Day in Canada celebrations in Ottawa. In November, the federal minister promised to open applications to the various federally funded programs in early 2018 to give producers and bureaucrats time to get the necessary funding in place before April and avoid funding gaps. “Of course, when the consultations started, one of the first things I was warned about was to make sure that we did not have the lapse that we had previously, because it hurts,” MacAulay told the House agriculture committee Nov. 30. “It hurts innovation and it hurts research. It hurts all the programs done under Growing Forward 2 that now are under the CAP program,” he continued, adding Ottawa “will be able to roll out money after April 1 to make sure we have continual flow.”
The federal programs, valued at $1 billion combined, include the previously announced AgriMarketing, AgriCompetitiveness, AgriInsurance, AgriDiversity, AgriInnovate and AgriScience. More specifics about these programs were expected Feb. 13. A review of CAP’s business risk management programs is also underway after MacAulay appointed a special producer advisory committee. The committee is expected to release an interim report later this spring with its final findings expected to be presented at the ministers’ annual meeting this summer. New details around the Canadian Agricultural Partnership isn’t the only agriculture-related announcement expected. Innovation Minister Navdeep Bains was expected to announce Ottawa’s long-awaited picks for federal supercluster funding promised in the 2017 budget. The
details were expected Feb. 15. Two agriculture-related projects are on the short list: one that deals with Smart Agriculture and the other focusing on plant proteins. Both proposals are said to have caught Ottawa’s attention and rumour goes the federal government is expected to fund at least one. Canada’s agriculture industry was invited to compete for some of the nearly $1 billion in federal funding earmarked for businessled innovation projects aimed at bolstering Canadian economic growth within select industries. The federal government has flagged this country’s agriculture industry for its economic growth potential. Ottawa has said it wants to grow the sector’s exports to $75 billion by 2025. Industry has said federal innovation funding would help the sector meet that target. MacAulay has repeatedly said innovation funding is a key part of the agriculture industry’s future
potential. Canada’s agriculture sector, he has insisted, has to be on the cutting edge. Meanwhile, Feb. 13 happens to be Agriculture Day in Canada with producers and industry groups descending on Ottawa to chat farming, trade and the future of the sector. The day’s activities include a keynote speech from Saskatchewan’s Murad Al-Katib, President of AGT Food and Ingredients Inc. and chair of the Agri-Food Economic Strategy Table. Al-Katib is heavily involved in the plant-protein related supercluster proposal. He also served as an adviser during Ottawa’s fasttracked review of the Canadian transportation system, whose related legislation remains under Senate consideration.
Kelsey Johnson is a reporter with iPolitics, www.ipolitics.ca.