Domestically, Canada’s agri-food system is facing a lot of challenges, but the pressures aren’t from just within the country. Many newly-felt pressures are from external forces.
A new report from Agri-Food Economy Systems based out of Guelph, Ont., outlines these new pressures on agri-food policy in Canada. The list of those pressures in the report is long; but Al Mussell, from Agri-Food Economic Systems and co-author of the report, joined Shaun Haney recently to break down how Canada will contest the challenges.
“The first challenge is to enumerate and account for all of the changes that we’re being exposed to,” says Mussell. “Obviously COVID just completely side-swiped everything. Certainly long-term, nobody saw this coming.”
One of the goals of the policy report, that the authors, including Mussell, thought might get missed, is that Canada’s domestic ag policy has been particularly dependent on foreign policy and agricultural trade environments. The set-up for the situation goes back to the ’70s and ’80s, when there was ongoing turmoil with regards to programs, equity for different commodities, grains programs in Western Canada, supply management instruments in Eastern Canada… and the list goes on.
What ultimately brought us to the point where we could have fixed cost-share programs, federally and provincially, was really that we had some stability in terms of market access, first in North America, then at a global level. As a country, we couldn’t afford to be provincially fragmented anymore, says Mussell.
Exports are critical for Canada’s economy, and they’re necessary for our ag industry. Canada needs to develop an understanding of the problems with AgriStability policy, but more generally the larger problems that may affect 30 to 40 per cent of the industry.
“We’ve got agricultural capacity that vastly outstrips our domestic markets so we need to be able to trade,” says Mussell. Sufficient levels of investment in our supply chains helps to feed into that, based on the understanding that we’d have secure market access, but that’s starting to fray away from us, Mussell says.
Going into harvest this year, there will be enormous corn and soybean stocks in the U.S. but since they have subsidy support, and Canada’s grain prices are based on U.S. grain markets, Canada may get into a sticky situation. Canada doesn’t have the treasury to support a subsidized system so we have to have another approach — to insulate ourselves without getting into a subsidized system and without the reverberation from our southern counterparts says Mussell.
Independently, Canada doesn’t necessarily have the capacity to refuse a powerhouse like China if a proposed trade deal is not in our favour, but perhaps by forming a coalition with like-minded ag trade partners, Canada would be able to say no. The right set of allies may serve as a stopper to the erosion of rules-based trading and pursuing bilateral and multilateral trade routes may be key to our future success.
One of the key takeaways from the report is that industry sectors will need to plan for existential threats, where if they planned for the risk of collapse, what would they be prepared to do. For example, the horticulture industry is too dependent on foreign workers and needs to have either a new labour strategy or a back-up cropping plan to form up against the effects of COVID-19.