Finding Efficiency Through Trade Policy Change

“Give me a level playing field and we can compete with the world’s best”

I heard this quote last September 22nd at a meeting for hog farmers set up by Ontario Pork. It was one statement that I classed as optimism in a room that was overwhelmingly negative. I can completely understand why negativity abounded at this meeting, every farmer in that room faces a very uncertain future but I want to focus on the positive.
While our farm at home is one of the many hog farms that faces that uncertain future I have a calming belief that I will still farm. I truly believe that agriculture is set to take the stage as the most important global industry as we will seek for ways to feed the growing population around the world. I also believe that Canada’s role in alleviating the global food crisis will hinge on our willingness to liberalize inefficient policies that abound in Canadian ag policy.

I chose to open with that quote from the meeting because I feel that Canada would thrive in a world of free competition, there is no nation in the world better suited for agricultural production. When you couple our natural resources with our comprehensive infrastructure of supporting businesses and extensive research and knowledge bases, Canada has the potential to be an agricultural superpower. If we were ever allowed to compete in a free market, Canadian farmers would thrive. That being said, if we want a free market then we should become leaders for others around the world: step up and eliminate policies in our own country that harm producers in other regions. This attitude may not be popular with producers in certain sectors of Canadian agriculture that benefit from protectionism but I want you to consider this simple fact: Canada can produce more food that it can ever hope to consume; is it not our responsibility to explore how to make our system more efficient in hopes of feeding people around the world.

As a person coming from a free market industry, we have shown that we can compete with the world’s best. Canadian hog producers are among the lowest cost producers in the world and I firmly believe that in a world of free competition we would not be suffering right now. This feeling is probably shared by a US dairy producer facing financial ruin. It stings when you work to be a world leader in terms of efficiency, only to see your hard work destroyed by protectionist policies of your trading partners.

While my feelings on trade liberalization are probably not shared by many in the agricultural community we must consider that we are an incredibly small portion of the population and I don’t feel that it is socially responsible when we benefit at the expense of others. Consider the supply managed industries: not only do they harm the Canadian consumer; they also harm producers in other nations. Is it fair that Canadian dairy producers are making a profit because of protectionism when farmers across the border in Michigan are in danger of losing their livelihood? This problem even exists within our own borders here in Canada. Hog producers in Ontario are struggling to survive while producers in Quebec benefit from provincial subsidies and then dump their product into Ontario. If we as Canadian producers ever tried to do to other trading partners what Quebec producers do to Ontario producers we would be hit with a trade challenge the minute our goods crosses our border and the practice would have to stop.

On a larger scale, we must consider that in the global population is going to grow to 9 billion within the next 40 years with the majority of this growth coming in developing nations that lack the ability to feed themselves. While production efficiencies are important, they are only part of the equation. Efficiencies will also have to be found through the liberalization of trade. Canada has an opportunity to be a world leader in this regard. While there would be much pain for producers here in Canada in the short term if protectionist policies were eliminated, in the end it would benefit both the Canadian producer and consumers.