Canadian farmers on the losing end of trade deal
‘Essentially, CETA will be eroding the market for areas that have been generally viable’
Our federal government is pushing Bill C-30 through the parliamentary process toward its passing as quickly and quietly as possible. This is the legislation required to implement the Comprehensive European Trade Agreement (CETA).
It could be that they are afraid that too many more people may discover just how negative some aspects of this deal really are. Many European countries may not ratify it for some time. It was developed largely in secret with very little objective information available to the public until it was released. Meaningful public consultation since then has likely been just camouflage. Promotion of this agreement has centred around improvements in GDP and more total dollars of exports, which is predicted will generate more jobs. I have seen very few credible figures on good jobs created versus good jobs lost by previous trade agreements (e.g. NAFTA). Our balance of trade with countries involved seems to have become worse.
It is possible that CETA could provide some increased export potential for certain agricultural commodities (e.g. pork, beef, grain). Unfortunately, it will surely shrink the market for others (e.g. milk, poultry and eggs). Essentially, CETA will be eroding the market for areas that have been generally viable for Canadian farmers, the economy and the public purse and expanding the market for others that have historically been much more problematic. CETA is unlikely to help those producers much.
For decades, agricultural commodities that have little or no strategy for competing in the marketplace have suffered from prices that have been below the cost of production too much of the time. Beef, pork and now grain farmers (with the abolition of the Canadian Western Wheat Board) are essentially “price takers.” The main strategy in these areas is “hope” and that has not proven to be a sound business practice. CETA is not going to change that.
For years, the beef industry has been fraught with a high percentage of farmers needing additional income to survive. This may include producing other agricultural commodities, off farm income including jobs sometimes with both spouses working to maintain struggling beef enterprises, huge stress and worse over enough resources to meet family requirements, family discord and disruptions. Bankruptcies (even a large Alberta feedlot is exiting the business recently), huge turnover of individuals, government bailouts, lower operational efficiency because of time constraints and resources to access available technology, etc. occur regularly.
The processing industry has evolved to even more domination by fewer and more powerful enterprises. Beef farmers depend on competition between these packers to generate a sustainable price. CETA will not help these farmers accomplish this. Any price increase, which might occur as a result of more trade, will be offset by increased (over) production that will drive the price down again. This is the way the unregulated (free) market always works.
Further, some technical processing difficulties exist in Canada that will not likely allow our beef to be exported to European countries any time soon. The Canadian Cattlemans’ Association, despite aggressive government lobbying in favour of CETA, admits that it could be many years before these problems are resolved. Meantime, European beef can flow into Canada as soon as the agreement starts creating downward price pressures.
Now this may appear to be good news for Canadian consumers, but in the longer term it will surely lead to the consumption of more beef that is not produced in Canada. Farmers here will be competing with subsidized product from other countries that may not have the same safety standards as we demand, will undoubtedly have a higher carbon footprint because of more transportation or produced in a less environmentally responsible way by workers who are not adequately paid. In addition, rural communities in Canada will suffer because of fewer and less viable farming operations and will have reduced ability to maintain rural programs and super structure.
I am not a protectionist. Good trade can be very beneficial, but I have huge concerns about long-term deals negotiated with so little regard to the welfare and expectations of “middle class” Canadians who have the most skin in the game because they are instrumental in the production of the product to be exported.
Everybody eats in Canada and it makes sense that Canadian farmers should thrive by producing this food wherever possible. They are one of the most stabilizing influences on our society and economy and on a food secure future for all of us.
A Guelph-area farmer leads his cows on a walk. Brian Griffith warns a European trade deal will have more drawbacks than benefits for Canadian beef producers.