Bridging the Gap

Sept 12, 2019 Read the article here.

We’re not quite halfway through our harvest here in Canada: The lentils and barley are done, the canola is starting to come in, and soon we’ll get to the durum wheat and chickpeas. It has been a challenging year doing business with Mother Nature.

As we begin to calculate this year’s yields, however, we’re starting to hear misleading reports in the media about our export opportunities. I’ve been a little annoyed by the sentiments and insinuations in some stories.

“It’s been a grim year for canola farmers in Canada, thanks to China’s closed market,” wrote Evan Dyer of CBC News. “Wheat farmers, on the other hand, are enjoying soaring foreign sales. And they have the People’s Republic of China to thank for it.”

Huh? Gratitude is a trendy word these days, but I don’t feel much towards China. The truth is that China is a huge problem and so are all countries that prefer the politics of protectionism to the economics of stable trade that help farmers and consumers everywhere.

For one thing, canola farmers and wheat farmers in Canada are the same people. Almost nobody specializes in one or the other. Instead, we grow both crops because our climate is suited to them and they work well in tandem. Rotating canola and wheat improves our soil health and helps us fight weeds, pests, and disease.

So, if it’s “a grim year for canola farmers in Canada,” as the CBC says, then it’s also a grim year for wheat farmers. No matter how our wheat is doing, we’re still getting pounded on another major commodity.

We also need to look at the bigger picture: Too often, the success or failure of our crops has nothing to do with our farming choices or what we’ve done in the field. Instead, it’s the result of political decisions in faraway cities.

In 2018, China bought about 40 percent of Canada’s canola exports, according to the Canola Council of Canada. These sales were worth $2.7 billion.

Then politics thrust itself into this welcome arrangement. At the request of the United States, Canada arrested Huawei executive Meng Wanzhou and China stopped buying Canada’s canola. Since that moment, prices have plunged, and Canadian canola stocks are piling up.

Meanwhile, we’re selling more wheat to China. “Canada’s share of total Chinese imports of wheat has rocketed above 60 percent,” according to a new report from the U.S. Department of Agriculture. But compare that to the loss of over 4mmt of canola and the celebratory vibe dwindles.

This year may be good for wheat and bad for canola. Next year it could be the reverse. This doesn’t mean that sometimes we win and sometimes we lose. It means we’re always losing because protectionism and gaming won’t allow us to make the most of our total potential. When politics gets between food producers and consumers, farmers suffer economic setbacks and ordinary people pay higher prices for their food.

The Americans are keeping a close watch on all of this because their own wheat exports to China have plummeted, following the tariffs Beijing has slapped on a wide range of U.S. agricultural products.

I won’t weigh in on the activities of Wanzhou or carry on about who’s to blame in the trade spat between the United States and China.

The problem here is that these trends are more about politics than agriculture. As a farmer here in Saskatchewan how do I navigate through this? It feels like the puppet-masters in Beijing, Ottawa, and Washington are determining my fate. And if it’s not them, it’s the market manipulators in Brussels, New Delhi and Rome who are playing their own games with the global trade in food.

Another country’s pain is not our gain, at least beyond the short term. It merely compounds the harms of trade warfare. Farmers are caught between a rock and a hard place - unenforced trade agreements and political gamesmanship. Most farmers feel that their voice is not being heard by those that can find solutions.

I am grateful that the Canadian government has finally launched a WTO action against China for blocking our canola exports. It’s a good start, although I worry that this action alone won’t be sufficient for China to change its protectionist ways. I have sincere gratitude when it comes to being a farmer and raising my kids within the gates of agriculture, but no CBC News. I won’t be mailing thank-you cards to China.