News
Senate urges action on ag inputs

June
17, 2008

The Canadian Senate's standing
committee on agriculture recommends the federal government step in to address
the rising costs of farm inputs, and to raise rural affairs' profile in
national policy.

In separate reports released Tuesday
— one on rural poverty, the other on the cost of farm inputs — the committee
respectively called for the government to create a new federal department of
rural affairs to implement many of its recommendations, and for changes to
federal farm programs to help farmers deal with rising costs for inputs such as
fertilizers.

Rural affairs

It's no surprise to rural residents
that Canada's rural populations are shrinking,
the Senate committee said, noting rural Canada's share of the national population
has dropped to below 20 per cent for the first time in Canada's history in the most recent
census.

Furthermore, the committee said in a
release Tuesday, "most of the resource-based industries such as
agriculture, forestry and fishing are in decline. Young people are leaving
rural Canada for school or work in the cities
and not returning. Meanwhile, those left behind — mostly seniors — watch as
schools, churches and businesses close down around them."

The committee held two years' worth
of meetings on rural poverty across the country in developing its report,
titled Beyond Freefall: Halting Rural Poverty.

The committee said a new rural
affairs department would drive the implementation of many of its 68
recommendations, which include:

• compensation to farmers for providing
  environmental stewardship services, as has already been put into practice
  in the pilot Alternative Land Use Services (ALUS) program;
• revising the Farm Families Options Program to
  "bring enhanced income stability to low-income farmers;"
• a new early learning and childhood education
  program "sensitive to rural realities;" resources for
  co-operative vocational schools in rural Canada; student loan and grant
  funding "sensitive to rural needs;" more university and college
  programs in rural Canada; and
• moving 10 per cent of the federal public service
  "out of the big cities and into the regions."

Ag input prices

The Senate committee's report on
farm input prices noted fertilizer prices as among the "areas of significant
concern for the committee," reporting that some fertilizer products that
have risen in price by as much as 240 per cent in four years.

Seed costs, the committee said, have
risen by as much as 80 per cent, while diesel fuel prices in some regions are up
more than 50 per cent over the previous year.

"As a grain producer I know
that the only way a farmer can remain competitive and survive is by keeping the
input costs down," said committee deputy chair Len Gustafson, a
Conservative senator from Saskatchewan.

"Canadians farmers have to
compete in the international marketplace. If the farm sector in Canada is to
survive, then the federal government will have to play a more forceful role in
monitoring and containing farm input costs."

Among the committee's
recommendations are:

• revising federal farm programs to help cover
  rising costs;
• examining the level of concentration in the
  fertilizer industry in Canada;
• examining current support levels for
  publicly-funded research, particularly on the cost-efficient use of farm
  inputs;
• having the federal finance department examine
  the level to which commodity traders in hedge and pension funds are
  distorting prices;
• funding for a program to help Canadian
  agri-retailers upgrade their security measures and safeguard fertilizer
  and pesticides from criminal misuse;
• having the federal agriculture department review
  how government regulatory measures may put the agri-food industry at a
  competitive disadvantage; and
• providing the agri-food industry with forums to
  discuss regulatory needs of new input products, and facilitate approval
  for products already sold in other countries.