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Copyright © 2001 Eastern Ontario Farmers Forum Inc. All Rights Reserved

Toughen up - use countervail

 

The unequal government support prices for crops give new meaning to the real estate mantra "location, location, location." With corn running in the vicinity of $2.25 a bushel, a crop farmer would be a lot better off in either Quebec or Michigan, the origins of cheap corn flooding the Ontario market and forcing the price below cost of production.

In the editorial "Recognizing Reality" in the December Ontario Corn Producer makes the case for its producers by attacking bureaucratic perception. Some people evidently say producers could have locked in when the price was higher, but says the editorial, and rightly so, that would have been a high stakes gamble. Had the crop failed and the price stayed high the farmer who sold his crop last February would have lost his shirt.

But some other things in the editorial are not reality. We’d like to know where that $500 cost of producing an acre of corn comes from. Somebody’s rental fees for the land must be very high.

What we find very unrealistic is the hand wringing at the end of the editorial. Price prospects for 2005 are below the cost of production and government needs to provide more assistance, says the editorial. Both Quebec and Michigan, who are flooding our markets, are more highly subsidized.

The reality is that the Ontario Corn Producers Association looks much like two years ago, before hundreds of eastern Ontario producers took their tractors on the roads. They chastised their politicians and their leaders for failing to negotiate a farm policy that would allow them to establish stability. Unfortunately, the reality is that corn producers in Ontario are further behind than they were two years ago. The safety net programs now in place will not protect them from two years of lower corn prices.

There is no point in lamenting that a Quebec farmer is guaranteed $4.95 per bushel for corn. Good for him. Lament rather that Ontario farmers are getting $2.30 a bushel and his organizations and governments are too timid to use the legal tools available to protect his market. We’re talking countervail. Michigan corn producers are dumping on our market. Dumping is defined as exporting a product into a country below the country’s cost of production and distorting that country’s market.

The corn producers association should do something about it. That’s reality, too.

What is also reality is the good money made in the food business. Galen Westen, the owner of Loblaw’s, is one of the 10 richest men in the country. His wife used to be Lieutenant Governor and did some of the finest charity work in the country. Your wife (or husband) too would have time for charity if you were paid decently for your product.

Here’s reality. One dollar’s worth of fries in a retail store or restaurant provides only a fraction of a penny to the farmer who harvested it. We have seen from the BSE inquiry before the Standing Committee in Agriculture that packers and chains never suffered. Their profits soared while farms pulled in their belts and tried to stave off bankruptcy. The Competition Bureau is toothless. The banks are fat. The politicians are not answerable to anyone and they can’t tell the contents of a honey wagon from the contents of a grain wagon. Everything is bull.

What’s at stake? The livelihood of the lower half of producers is at stake, which may not bother officials. Governments have often said that only two-thirds of the current producers are needed in this country. In Ontario, they could soon get their wish. Yet if those producers were in Michigan or Quebec they could go on producing and making some money. But not in Ontario, where farm policy consists of some "Buy Ontario" ads in various media during harvest.

If those producers go out of business, rural areas will be financially hurt. Together the 25,000 or so farmers who could be forced out of business pack a big financial clout. It won’t be just their income. It will be the income of many small businesses. That’s the reality.

Commodity boards and general farm organizations must convince governments the assumption our food supply is guaranteed is short-term folly. Convince them that short-term inconvenience is often the price of long-term prosperity. Show them reality. Maybe farm organizations aren’t up to the job.

— T. Meagher