Ottawa lacks clear strategy for agri-food
New measures needed to stabilize industry, writes Sylvain Charlebois.
This past week has been pivotal for economic indicators. The Bank of Canada has opted to maintain its benchmark interest rate steady, while recent data revealed that inflation in the U.S. is accelerating again.
The U.S. economy appears robust, which sharply contrasts with Canada, where there is an anticipatory hope for a “soft landing” — a scenario that includes avoiding recession while achieving full employment.
However, the economic data from Canada indicate significant headwinds in productivity and wealth creation. There is widespread speculation about interest rate adjustments across North America.
The U.S. Federal Reserve is contemplating an increase, which has already begun to exert downward pressure on the Canadian dollar. This has weakened significantly and might dip below 70 cents against the U.S. dollar by early May. This depreciation could make imports, including food, more expensive.
Amid these economic tremors, Canada has unveiled its new budget after two weeks of exhaustive discourse, featuring over $20 billion in new expenditures.
The Trudeau government is persuading Canadians of the diminishing necessity for provincial involvement, positing that Ottawa alone can fulfil its promises. This centralized approach is also evident in measures related to the agri-food sector and food security.
Despite the national school food program, the budget was silent on new measures to stabilize or nurture our agrifood economy. Food inflation is on a down trend, yet per capita food expenditures are also falling.
The average Canadian now spends approximately $248 monthly on food at retail outlets, a significant drop from the $339 needed to sustain a healthy diet. This reduction is evident in a shift toward cheaper, nutritionally deficient alternatives — a trend previously unseen in Canada.
The root cause extends beyond food prices alone.
The cost of living, primarily housing, has prompted many Canadians to economize at the grocery store. In response, the Trudeau government has focused intensely on housing policies in recent weeks, though the strategies employed are open to debate.
What is glaringly missing is a definitive, actionable vision for Canada's agri-food sector. The national school food program should have been an integral part of the Sustainable Canadian Agricultural Partnership, which concludes in 2028.
Logically aligning what we cultivate with what children eat in schools seems straightforward, yet Canada complicates food-related initiatives. This inconsistency extends to support for food banks and food rescue organizations.
Three years ago, Ottawa formed a Food Policy Advisory Council to shape Canada's agri-food vision, but its impact has been minimal, with many members resigning and low attendance at meetings.
Contrastingly, the United States is poised to introduce a new Farm Bill to legislators, a $1.4-trillion initiative over five years that will dictate the future of its agriculture and nutrition policy.
This amount dwarfs Canada's entire national debt and equates to $820 per American annually, compared to a mere $17 per Canadian. The U.S. policy, including the Supplemental Nutrition Assistance Program, demonstrates a profound commitment to supporting its agri-food sector in line with national interests.
We may disagree with their vision for agriculture and agri-food, but at least they have a clear vision. Meanwhile, Canada is still grappling with how to protect the antiquated supply management regime at all costs, particularly through the controversial Bill C-282. We just do not take our agri-food priorities seriously.
While it would be unfair to attribute all our challenges to the Trudeau government alone, it undoubtedly possesses a unique opportunity to define a forward-looking vision for the agri-food sector.
Its commitment to environmental stewardship could play a pivotal role, but Ottawa should also consider extending its influence over provincial domains where it can meaningfully impact agriculture and food security.
However, one should not hold their breath for transformative outcomes from the budget. It appears unlikely that significant advances will emerge.