45 Replies to “Sure Enough, Farmers Finally Begin To Make Some Money”
The article basically seeks to absolve people of supplying their own food.
There are oppurtunities to grow your own food if you don’t like the prices, no need to force others to do it for you.
This economically illiterate communist clearly doesn’t realize that in commodities (as in all goods,) price is information.
Price gives you vital information about supply and demand. Price lets you know when you have too much or too little of something and allows an adjustment to take place (so long as government isn’t removing the market mechanism from the process.)
When the market is out-of-whack (or equilibrium,) the market mechanism is what adjusts it back into place. Without the market to price goods, you will not have a balanced supply/demand situation.
In commodities like food (where the stakes of shortage are great,) a market mechanism is EVEN MORE IMPORTANT!
Scarcity in food is CREATED by government, not solved by it.
But then I’d expect no less stupidity from someone pining for the days of Trudeau.
Maybe I haven’t had enough coffee, but it would seem to me that the subtext of that article was that the only market that matters for food stability is Canada. What can’t be missed is the socialist theme in the article. What is completely missed is WHY food prices have shot up so dramatically in such a short time. I believe firmly in a market driven economy, and that fair prices and best practices are achieved through market forces and a hands-off approach from governments. However, the curreny spike in food prices is completely driven by government policy. If it weren’t for the myopic environmental agenda that is driving the biofuel craze, corn, rice and soybeans would still be stable and the current riots and instability over food prices would not be happening. The fact is that biofuels are a fruad; they’re environmentally and economically destructive. The biofuel crops are collectively the poster child for the hypocrisy of the anti-global warming environmentalists.
The increases we’ve seen in the price of food grains, oil and gasoline are not being driven by the normal market forces of supply and demand. They are the direct result of the ‘chicken little’ approach by governments creating knee-jerk environmental policies. These policies have no basis in sound science or even common sense, and instead of achieving any noble environmental goals, they instead sow the seeds of distrust and instability in the markets.
Of course, this may well be the goal of the hardened enviromental crowd. After all, they ardently reject and resent democracy, free markets, and the social and technological advances that free societies realize
Next thing you know the Saskatchewan farmer will be blamed for the rice shortage.
its simple yet not mentioned… oil price determines food prices..
Price is a means to ration supply. Kill the price signal, and kill the mechanism to best allocate a scarce resource.
Perhaps the author should give examples of the stable food supply in socialist paradises such as North Korea, and Cuba.
Barely a sentence into the article and SURPRISE, Trudeau’s name appears.
Mark Steyn’s recent article on bio fuels and their effect on the food supply was enlightening. It would be ironic if farmers succeeding meant a lack of available food.
That aritcle is just silly. Let the free market take its course. People in Canada will always have food available. We have more than enough land to supply our population. Why would we ever have to depend on the rest of the world to feed us? Plus, the more profitable that farming is, the more land will be used for that purpose.
The environmental chicken little crowd are not reaping what they sowed. They have decided that we need biofuels and need to slow down oil production, not acknowledging that the prices will go up. Now we are seeing the effects of governement policies made to placate the environmental movement. Imagine the cost if all the carbon measures were implemented.
I posted most of this a few days ago.
Someone who works in the industry of marketing grain recently posted here explaining how recent poor winter wheat crops have affected grain pricing.
“FAO forecasts dismal rice production for Australia, reflecting extremely low water availability.”
“The traditional rice exporting countries of China, India, Egypt, Vietnam and Cambodia, have either imposed minimum export prices, export taxes or export quotas or bans. Such moves are expected to reduce rice exported from these countries”
In other countries like India, the mass manipulation of farming by corporate interests has forced many farmers into such dire straights that thousands have committed suicide.
In Vietnam where the government controls seed and fertilizers for planting rice crops, the materials to plant have been held back in some areas so long that many are worried they will not be able to get a crop in.
Then there is this; A reduced crop is also expected in the United States, mainly as a result of a cut in area caused by mounting competition from more profitable crops. That’s CAPITALISM, free market or whatever else you wish to call it.
Yet even with all of this, “Rice production is projected to be up for 2008 by 12 million metric tons or 1.8 percent”. It’s not land used for bio fuel that’s the problem, it’s demand. “The international rice market is currently facing a particularly difficult situation with demand outstripping supply and substantial price increases,” http://deltafarmpress.com/rice/world-production-0404/
I know that in our province and our neighboring province there are literally tens of thousands of acres of land that used to be farmed but now lies dormant because there hasn’t been any money in farming for over 30 years. Except maybe Dairy and that’s now going the way of Poultry producing too. As it is now, if you aren’t milking 200 cows, you are not keeping pace.
Hugger
darn those farmers anyway, cant they supply us food for cheap like the civil servants supply us with civil services for……
rats , bad example.
And if you don’t believe that, here is some more from Kaushik Basu Professor of economics, Cornell University
A more proximate cause is the severe drought in Australia and shortfall in the production of staples in Ukraine and Kazakhstan. These are, however, not big enough to explain the large inflation.
To understand the latter we have to analyse how these small triggers have caused speculative moves and given rise to a complex brew of corrective measures.
India, Argentina and other food-exporting nations have, in response to global inflation and in order to protect their own consumers, imposed restrictions on exports.
This is an understandable move, but it exacerbates inflation in food-importing countries.
Moreover, the policy of holding prices down for the benefit of consumers can dampen farmer incentives. In Pakistan this year farmers have used about 600,000 tonnes of fertiliser, which is a drop of about 50% from earlier levels. This is bound to mean less on wheat production. http://news.bbc.co.uk/1/hi/world/south_asia/7365798.stm
Hugger
People like this disgust me. They would be right at home heading up centralised planning in some communist country no doubt.
It is rare that farmers (not absentee land owners of industrialised agriculture) get a break with what they produce. They are faced with mounting government/big brother intervention and regulations on top of the unpredictability of nature, only to see too often everyone but themselves making a profit from what they have produced. I recall a few years back the mad cow hype when it was often cheaper to shoot the cow or steer and bury it than to ship it to the auction. Once the farmer had paid the trucking and commission, he or she was out of pocket instead of making a penny. Yet I also noticed that no where did the price of beef decrease in the stores.
Out here in beautiful BC we have the wonderful socialist legacy from Dave Barrett, the Agricultural Land REserve. The premise: in a province with a smail percentage of arable land we must preseve agricultural land. What should be obvious to anyone with half a brain. Is that we doom our farmers to proverty. Their land is worthless because we won’t allow any development on it, but we say “shut up and keep growing your wonderful fruits and vegies because it makes us all feel better about ourselves.” Never mind that you can’t make a living. Oh dear, never thought of that. If they followed the logic of the ALR, they would realize we need guaranteed farm gate prices to keep the aggies viable. Or scrap the whole thing.
I vote for the latter.
Someone should dig up that Lizzy May quote where she said “Canadians should have a base income provided by the government.”
I have long thought Canada needs a food policy but not to control prices.
The policy I envision would ensure we retain the capacity to produce food so we don’t have store shelves filled with stuff labelled “Fabrique en Chine” (with all those attendant risks). This policy would protect valuable farm land from urban sprawl and it would obviously have to compensate farmers for depriving them of the right to sell their land to developers. Once dug up, built on, and paved over, this land is lost to agriculture so it needs preserving.
In a time of rising fuel prices and uncertain global politics, it is dangerous folly to base your food source on growers and producers half a world away. National security dictates that we retain the ability to produce our own food.
“Consumers have received a consistent supply of quality product and farmers have received fair returns from the market place. ”
Yea for slaves….
Here’s a food policy for you (and an energy, housing, and communications policy to boot). Get government out of the way and let the market take care of it.
Too bad the author of this article referenced PET so early in her report. All that did was bring all the right wingnuts out of the wood work. What she really seems to be saying here is we need to protect our current farmers and their children who’ll take over for them so we can rely on future supplies of food in this country. I don’t get how that’s socialist, communist or any other type of ist. It’s actually good business and sort of what this country is trying to do right now. The real problem of jumping food prices isn’t how much farmers receive. It’s how much the retailers charge. I live in a farming area and trust me those high prices we pay in the supermarket do not begin to trickle down to the farmer. How to fix it? Who knows? But you won’t find the answer calling people names.
Who’s Lorne Small? http://www.ontariosheep.org/PHONELS2.HTML
———-
Lorne operates a century farm with 325 commercial ewes near Kenilworth with his wife Jennifer and five young children. Lorne and Jennifer also have three grown children. Lorne has served on the OSMA board since 1999 and represents OSMA on the Livestock Medicines Education Committee.
Lorne was raised on a dairy/beef/swine farm in Wellington County. He obtained an undergraduate degree in Animal Science and a Masters degree in Economics and Business from the University of Guelph.
Lorne worked for the Ministry of Agriculture, Food & Rural Affairs for 13 years as an Agricultural Representative and Farm Management Specialist, and then became the first General Manager of the Ontario Dairy Herd Improvement Corporation. Lorne and Jennifer own and operate a printing business ~ Phildon Graphics.
Lorne is also a member of the Executive Board of the Christian Farmers Federation of Ontario.
————-
Century farm? So what Lorne really wants is to keep his too-small farm at my expense?
“Because food shouldn’t be a world-trade commodity, … a Canadian food policy needs to be developed that provides food security for Canadian citizens.”
Where do I get my year-round banana production quota?
I too took my degree in AG at Guelph and I am embarassed that this joker got a similar degree from there. He almost certainly had to have taken Ag economics with T.K. Warley as Prof., but he must have been wasted during class to have missed the awesome arguments of Dr. Warley. http://www.bookfinder.com/author/t-k-warley/
It beggars belief that anyone can still think that way. The former Soviet Union, which turned Russia, once the bread basket of Europe into a grain importer, China under the communists with it’s world record breaking famine, North Korea, Cuba — testaments all to the failure of command economics, yet we have economic illiterates who still advocate these facile, myopic policies.
Calgary once had a housing shortage, but the government, to its credit, did not attempt price control. The result: 19,000 listings last month and an abundance of rental and purchase accomodation. Housing prices are coming down. Adam Smith’s hidden hand is at work. There will be price corrections and hardship, but far, far less than had the government made a ham-handed attempt to control the market.
The current global food shortages arise from government subsidies to inefficiency, suppression of the free flow of produce, and producers being paid by governments to leave land fallow, artificially alter the price, and thereby game votes, not to mention subsidies for biofuel prompting the diversion of food into a use to which it could not be put profitably otherwise.
Food prices will continue to rise for a while yet until it stabilizes worldwide…The orgy ride of cheap food and goods we enjoyed for more than a decade are nearing the end folks. Get use to it and better yet, start dusting off grandma’s recipe books instead of eating out everyday and/or buying President Choice ready packaged meals. Brew your own instead of idling the SUV each morning at Timmys. ENERGY demand is outpacing supply. EVERYTHING will go up in price. Most of our gadgets are made of plastic which is petroleum based too. Until new major sources of stable and easily extracted oil is discovered and more so new refineries are built without environut intervention (Which has to wear a big part of the blame) and the American dollar keeps loosing it’s value, the consumerism religion is on it’s way to extinction.
North America: Get prepared to live like your less affluent European cousins.
The world economy is now global. China and India(And they’re a lot more of them than us!) are joining the “club” thanks in part to all of our collective greed for cheap consumer goods.
In 5 years from now when you go shopping it will be likely for something you truly need instead of “shopping for entertainement”.
Amazing ! It is as if Reuters, Thompson, AP directors from above thought — let me see ? Who/what will we pin the high cost of rice on.
No, won’t blame it on biofuels taking a quarter of the US corn crop. Nor the European policy of demanding food be burnt in their SUVs. Nope, that would be to anti-enviro.
Directions to all media.
Rice shortage due to AGW drought in Australia. Pass it on.
All good obedient socialists will parrot the idiot box line. Some will even appear as guest experts.
But don’t tell anyone the Aussie rice crop, all of it even in a good year, is only about a million tonnes. Total world rice crop ? About 645 million tonnes. (0.15%)
But, oh no. Don’t any of you journos out there question how a 0.15% portion can cause all the trouble. Have to protect Maurice Strong, Gore, Suzuki et al from any critism, ya see.
Too bad, Lorrie Goldstein already has.
The part that really stinks in all this — for a decade, grain & oilseed prices have been below the cost of production. Because of biofuels and hedge funds, grain prices rise sharply. Headlines: Grain Prices Double, Food Crisis.
Hey that’s the CKNX AM920 country&info radio station in my area, Wingham ON. Kate must have great reception to get that AM station in SK!
This is just more CFFO support for the “little guy” with the million $ chicken/milk quota.
The CFFO and the OFA are the saner of the three ag groups in Ontario — you should hear the NFU talks if you like neoStalinism.
This is nothing new — you should read some of the Rural Voice newsletters we get for free. Everything is a major plot by ag corps to crush the little guy..
The only platitude he left out was “social justice”!
Who gives knobs like Small the space to publish crap like this??
Freekin ignoranus!
Posted by: SaskKen at April 29, 2008 2:12 PM
Most people don’t understand the delivery of food in our own country let alone the world. You are correct that retail prices do not reflect farm gate price or even close to it. One of the problems is that government loves big business. There are reasons for that. Like political contributions, appointments to boards of directors and “other” income opportunities.
Another major issue is that retail giants also own the wholesaling divisions. This is how we end up shipping food items thousands of kilometers rather than purchasing local products. With their phenomenal purchasing power they offer opportunities to suppliers at a predetermined price. Theirs. Take it or risk losing the business.
They can make you or break you. Its just that simple. Few people know how few companies control the grocery market. Pretty much anywhere in this country, if you can count to three thats likely more than you need. http://www.canadianmade.com/grocery.shtml
Bear in mind that those not associated with one of the majors, usually has to use their wholesale divisions. These also include food service divisions as well. So in effect, they control the profitability of the smaller operations as well.
Here’s something I found amusing. Some years ago a fellow who was running truck from PEI to Montreal carrying potatoes (what else eh?) told me of seeing trucks from Ontario unloading at the same facility but all the bags he could see were marked PEI potatoes. When he asked an employee about it, the guy smiled and said “what they don’t know won’t hurt them.”
Those potatoes that are now hauled by trucks from PEI used to be transported by rail. Just thought I would add that.
Greg and SaskKen:
Your anti-business rhetoric is only a few steps away from the anti-market rhetoric of this posts feature item. If you think the big retailers make unfair returns take a look at their EPS and their margins on goods sold – they tell a very different story – that of a hyper-competitive business sector.
I’ve seen this coming for years, the writing was on the wall. It would first start with energy costs, and then commodities and food. Other factors are at play, like the declining US dollar, but that also was predictable. When you’re up to your eyeballs in debt one sure way out is to devalue the currency.
In any event 5 years ago I started growing all my food. I had other reasons too: I’ve had it with hormone-ridden meat, pesticides, antibiotics and all the other stuff. All my friends said I was crazy. Well, today they call me a genius 🙂
I hope out of this we’ll see the small family farms come back.
Posted by: Gord Tulk at April 29, 2008 6:50 PM
I ran several businesses which purchased goods from two of the giants and had occasion to deal with sales and purchasing personnel regularly. This indicated strong gross margin positions for product lines due to extraordinary purchasing power. I also worked as an agent for one of them in a related area for over 2 years and cleaned up some pretty bad financial situations because of poor decisions and lack of knowledge of some of their top local employees. This was petroleum related and not one of their core business interests.
Capital expenditures, expansions and acquisitions factor heavily into EPS as well. I’m not privy to their internal accounting strategies.
It’s not that I’m anti business, just anti business of that size which is predatory. They are not doing us any favors. There were grocery outlets and wholesalers before they came and a lot more local product. I expect I am older than you.
I only remember the board making any money off our sweat. Obviously this Mr. Small who appears to be a wheat board cronie is desperate to keep his snout in the trough.
All this talk about bio-fuels causing high prices is really not accurrate. Yes, it plays a part but what most people dont realize is that when corn is used for ethanol, it is not removed from the food chain.
Dried Distillers Grain is a by-product of ethanol production while makeing up one-third of the bulk of the corn going in, it contains 3 times the protein contained in corn making it a very nitritious animal feed at a very reasonable price.
As far as the real causes of higher commodity prices. A growing global population coupled with the fact that alot of this growing population is growing wealthier, droughts, and a lack of production brought on by years of low commodity prices.
With prices where they are alot of land will be put back into grain production and in a couple years we will go back to cheaper food and farmers going broke.
big agriculture nneds big gov’t
let’s regulate the hell out of this !!
OH we alredy have…………
that’s why we’re in this mess
commoditties ????
jay-mo:
Some of the food-value of the corn remains that s true but only a small fraction of it. the starch energy largely goes into making ethanol. 3 times protien by weight or volume is true but there is far less volume and weight left after the ethanol is made.
POP growth and drought are indeed contributing factors but ethanol/biodiesel demand/production is what pushe the prices up to the levels they are now. Two years ago the US was the world’s largest exporter of corn – 40% of the crop if memory serves. Today it is a net importer. the explosive growth of the Ethanol industry was the reason.
Posted by: ron in kelowna at April 29, 2008 4:45 PM
Amazing ! It is as if Reuters, Thompson, AP directors from above thought — let me see ? Who/what will we pin the high cost of rice on.
Directions to all media.
Rice shortage due to AGW drought in Australia. Pass it on.
Madison Ventures Corp. (Glacier Ventures International)
Directions to all Canadian western small town and farm papers.
Rice shortage due to AGW drought in Australia. Pass it on.
Re: “It’s not that I’m anti business, just anti business of that size which is predatory. They are not doing us any favors. There were grocery outlets and wholesalers before they came and a lot more local product. I expect I am older than you.”
Posted by: Greg at April 29, 2008 9:01 PM
Probably not older than me though, but then, I think I may agree with you in some areas. Especially when predatory and speculative business practices of a few huge international corporations affect millions of people who might not be able to afford food.
As much as I may agree the government can really make a mess of thing, being able to afford food trumps any capitalist ideology. There are situations where a socialist approach is the right one. Any good capitalist would agree.
“There are situations where a socialist approach is the right one. Any good capitalist would agree.”
Name one.
Re: “name one”
How about all of them, or at least the ones with any brains, which is all of the ones I care about.
cop-out
I mean name a situation.
It’s not a cop-out. I don’t have a lot of time.
If there’s no market, there’s no capitalism. It’s “the people” who put the capital in capitalism. If the people have no disposable income because all the money they have is going to food and shelter, our economy begins to implode.
Few capitalists are one man operations, doing everything themselves. They need healthy, educated, trained workers to exploit (I’m not using the word exploit in a negative sense).
So socialized medicine and education both play a role, whether or not we agree it should be monopolized.
I could go on, but like I said …
Jibber-jabber. Socialized Medicine doesn’t work nor does socialized education – market forces for both exist and allowing a market to address them is the best way. When you get ime perhaps you could check out Milton Friedman’s writings on vouchers and Health spending accounts.
Well hundreds of millions would disagree. And I’ve only used a couple of examples. There are many, many more. The fact neither of these examples is perfect, both could be improved, and private investment can play an important role doesn’t mean they don’t work. Actually they work very well, otherwise I wouldn’t be able to write or post here, or anywhere.
The problem I have with the left wing ideologues is that they refuse to consider private for profit business playing any role in socialized health or education because they are more interested in their ideological position than they are in doing what works best for the people they claim to represent. I have a similar problem with those “capitalists” who reflexively refuse to consider anything attached to the word socialist as good for them, or the people they claim to represent.
I’m not saying you’re doing that, but you’re missing the point. And I think you’re just spoiling for a fight, not a debate, so this will be my only word on the subject.
It’s in the market’s interest to ensure everyone (or as many as possible) has a good education, and are healthy, and able to perform the work the corporations require. The more people there are that work and earn a living, the bigger the market. It’s simplified, but really it’s pretty simple.
The government is the people, or represents the people, all of the people, and so are far better positioned to ensure everyone potentially has equal access to and receives a decent education, and has access to health care.
The private sector can certainly contribute, and even make a profit doing so, but, ultimately, the company’s only allegiance is to itself, and their interest in any form of socialism is entirely self-serving, and not necessarily beneficial to society as a whole. Their involvement needs to be managed by the people.
The article basically seeks to absolve people of supplying their own food.
There are oppurtunities to grow your own food if you don’t like the prices, no need to force others to do it for you.
This economically illiterate communist clearly doesn’t realize that in commodities (as in all goods,) price is information.
Price gives you vital information about supply and demand. Price lets you know when you have too much or too little of something and allows an adjustment to take place (so long as government isn’t removing the market mechanism from the process.)
When the market is out-of-whack (or equilibrium,) the market mechanism is what adjusts it back into place. Without the market to price goods, you will not have a balanced supply/demand situation.
In commodities like food (where the stakes of shortage are great,) a market mechanism is EVEN MORE IMPORTANT!
Scarcity in food is CREATED by government, not solved by it.
But then I’d expect no less stupidity from someone pining for the days of Trudeau.
Freer Trade Could Fill the World’s Rice Bowl
Maybe I haven’t had enough coffee, but it would seem to me that the subtext of that article was that the only market that matters for food stability is Canada. What can’t be missed is the socialist theme in the article. What is completely missed is WHY food prices have shot up so dramatically in such a short time. I believe firmly in a market driven economy, and that fair prices and best practices are achieved through market forces and a hands-off approach from governments. However, the curreny spike in food prices is completely driven by government policy. If it weren’t for the myopic environmental agenda that is driving the biofuel craze, corn, rice and soybeans would still be stable and the current riots and instability over food prices would not be happening. The fact is that biofuels are a fruad; they’re environmentally and economically destructive. The biofuel crops are collectively the poster child for the hypocrisy of the anti-global warming environmentalists.
The increases we’ve seen in the price of food grains, oil and gasoline are not being driven by the normal market forces of supply and demand. They are the direct result of the ‘chicken little’ approach by governments creating knee-jerk environmental policies. These policies have no basis in sound science or even common sense, and instead of achieving any noble environmental goals, they instead sow the seeds of distrust and instability in the markets.
Of course, this may well be the goal of the hardened enviromental crowd. After all, they ardently reject and resent democracy, free markets, and the social and technological advances that free societies realize
Next thing you know the Saskatchewan farmer will be blamed for the rice shortage.
its simple yet not mentioned… oil price determines food prices..
Price is a means to ration supply. Kill the price signal, and kill the mechanism to best allocate a scarce resource.
Perhaps the author should give examples of the stable food supply in socialist paradises such as North Korea, and Cuba.
Barely a sentence into the article and SURPRISE, Trudeau’s name appears.
Mark Steyn’s recent article on bio fuels and their effect on the food supply was enlightening. It would be ironic if farmers succeeding meant a lack of available food.
That aritcle is just silly. Let the free market take its course. People in Canada will always have food available. We have more than enough land to supply our population. Why would we ever have to depend on the rest of the world to feed us? Plus, the more profitable that farming is, the more land will be used for that purpose.
The environmental chicken little crowd are not reaping what they sowed. They have decided that we need biofuels and need to slow down oil production, not acknowledging that the prices will go up. Now we are seeing the effects of governement policies made to placate the environmental movement. Imagine the cost if all the carbon measures were implemented.
I posted most of this a few days ago.
Someone who works in the industry of marketing grain recently posted here explaining how recent poor winter wheat crops have affected grain pricing.
“FAO forecasts dismal rice production for Australia, reflecting extremely low water availability.”
“The traditional rice exporting countries of China, India, Egypt, Vietnam and Cambodia, have either imposed minimum export prices, export taxes or export quotas or bans. Such moves are expected to reduce rice exported from these countries”
In other countries like India, the mass manipulation of farming by corporate interests has forced many farmers into such dire straights that thousands have committed suicide.
In Vietnam where the government controls seed and fertilizers for planting rice crops, the materials to plant have been held back in some areas so long that many are worried they will not be able to get a crop in.
Then there is this; A reduced crop is also expected in the United States, mainly as a result of a cut in area caused by mounting competition from more profitable crops. That’s CAPITALISM, free market or whatever else you wish to call it.
Yet even with all of this, “Rice production is projected to be up for 2008 by 12 million metric tons or 1.8 percent”. It’s not land used for bio fuel that’s the problem, it’s demand. “The international rice market is currently facing a particularly difficult situation with demand outstripping supply and substantial price increases,”
http://deltafarmpress.com/rice/world-production-0404/
I know that in our province and our neighboring province there are literally tens of thousands of acres of land that used to be farmed but now lies dormant because there hasn’t been any money in farming for over 30 years. Except maybe Dairy and that’s now going the way of Poultry producing too. As it is now, if you aren’t milking 200 cows, you are not keeping pace.
Hugger
darn those farmers anyway, cant they supply us food for cheap like the civil servants supply us with civil services for……
rats , bad example.
And if you don’t believe that, here is some more from Kaushik Basu Professor of economics, Cornell University
A more proximate cause is the severe drought in Australia and shortfall in the production of staples in Ukraine and Kazakhstan. These are, however, not big enough to explain the large inflation.
To understand the latter we have to analyse how these small triggers have caused speculative moves and given rise to a complex brew of corrective measures.
India, Argentina and other food-exporting nations have, in response to global inflation and in order to protect their own consumers, imposed restrictions on exports.
This is an understandable move, but it exacerbates inflation in food-importing countries.
Moreover, the policy of holding prices down for the benefit of consumers can dampen farmer incentives. In Pakistan this year farmers have used about 600,000 tonnes of fertiliser, which is a drop of about 50% from earlier levels. This is bound to mean less on wheat production.
http://news.bbc.co.uk/1/hi/world/south_asia/7365798.stm
Hugger
People like this disgust me. They would be right at home heading up centralised planning in some communist country no doubt.
It is rare that farmers (not absentee land owners of industrialised agriculture) get a break with what they produce. They are faced with mounting government/big brother intervention and regulations on top of the unpredictability of nature, only to see too often everyone but themselves making a profit from what they have produced. I recall a few years back the mad cow hype when it was often cheaper to shoot the cow or steer and bury it than to ship it to the auction. Once the farmer had paid the trucking and commission, he or she was out of pocket instead of making a penny. Yet I also noticed that no where did the price of beef decrease in the stores.
Out here in beautiful BC we have the wonderful socialist legacy from Dave Barrett, the Agricultural Land REserve. The premise: in a province with a smail percentage of arable land we must preseve agricultural land. What should be obvious to anyone with half a brain. Is that we doom our farmers to proverty. Their land is worthless because we won’t allow any development on it, but we say “shut up and keep growing your wonderful fruits and vegies because it makes us all feel better about ourselves.” Never mind that you can’t make a living. Oh dear, never thought of that. If they followed the logic of the ALR, they would realize we need guaranteed farm gate prices to keep the aggies viable. Or scrap the whole thing.
I vote for the latter.
Someone should dig up that Lizzy May quote where she said “Canadians should have a base income provided by the government.”
I have long thought Canada needs a food policy but not to control prices.
The policy I envision would ensure we retain the capacity to produce food so we don’t have store shelves filled with stuff labelled “Fabrique en Chine” (with all those attendant risks). This policy would protect valuable farm land from urban sprawl and it would obviously have to compensate farmers for depriving them of the right to sell their land to developers. Once dug up, built on, and paved over, this land is lost to agriculture so it needs preserving.
In a time of rising fuel prices and uncertain global politics, it is dangerous folly to base your food source on growers and producers half a world away. National security dictates that we retain the ability to produce our own food.
“Consumers have received a consistent supply of quality product and farmers have received fair returns from the market place. ”
Yea for slaves….
Here’s a food policy for you (and an energy, housing, and communications policy to boot). Get government out of the way and let the market take care of it.
Too bad the author of this article referenced PET so early in her report. All that did was bring all the right wingnuts out of the wood work. What she really seems to be saying here is we need to protect our current farmers and their children who’ll take over for them so we can rely on future supplies of food in this country. I don’t get how that’s socialist, communist or any other type of ist. It’s actually good business and sort of what this country is trying to do right now. The real problem of jumping food prices isn’t how much farmers receive. It’s how much the retailers charge. I live in a farming area and trust me those high prices we pay in the supermarket do not begin to trickle down to the farmer. How to fix it? Who knows? But you won’t find the answer calling people names.
Who’s Lorne Small?
http://www.ontariosheep.org/PHONELS2.HTML
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Lorne operates a century farm with 325 commercial ewes near Kenilworth with his wife Jennifer and five young children. Lorne and Jennifer also have three grown children. Lorne has served on the OSMA board since 1999 and represents OSMA on the Livestock Medicines Education Committee.
Lorne was raised on a dairy/beef/swine farm in Wellington County. He obtained an undergraduate degree in Animal Science and a Masters degree in Economics and Business from the University of Guelph.
Lorne worked for the Ministry of Agriculture, Food & Rural Affairs for 13 years as an Agricultural Representative and Farm Management Specialist, and then became the first General Manager of the Ontario Dairy Herd Improvement Corporation. Lorne and Jennifer own and operate a printing business ~ Phildon Graphics.
Lorne is also a member of the Executive Board of the Christian Farmers Federation of Ontario.
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Century farm? So what Lorne really wants is to keep his too-small farm at my expense?
“Because food shouldn’t be a world-trade commodity, … a Canadian food policy needs to be developed that provides food security for Canadian citizens.”
Where do I get my year-round banana production quota?
I too took my degree in AG at Guelph and I am embarassed that this joker got a similar degree from there. He almost certainly had to have taken Ag economics with T.K. Warley as Prof., but he must have been wasted during class to have missed the awesome arguments of Dr. Warley. http://www.bookfinder.com/author/t-k-warley/
It beggars belief that anyone can still think that way. The former Soviet Union, which turned Russia, once the bread basket of Europe into a grain importer, China under the communists with it’s world record breaking famine, North Korea, Cuba — testaments all to the failure of command economics, yet we have economic illiterates who still advocate these facile, myopic policies.
Calgary once had a housing shortage, but the government, to its credit, did not attempt price control. The result: 19,000 listings last month and an abundance of rental and purchase accomodation. Housing prices are coming down. Adam Smith’s hidden hand is at work. There will be price corrections and hardship, but far, far less than had the government made a ham-handed attempt to control the market.
The current global food shortages arise from government subsidies to inefficiency, suppression of the free flow of produce, and producers being paid by governments to leave land fallow, artificially alter the price, and thereby game votes, not to mention subsidies for biofuel prompting the diversion of food into a use to which it could not be put profitably otherwise.
Food prices will continue to rise for a while yet until it stabilizes worldwide…The orgy ride of cheap food and goods we enjoyed for more than a decade are nearing the end folks. Get use to it and better yet, start dusting off grandma’s recipe books instead of eating out everyday and/or buying President Choice ready packaged meals. Brew your own instead of idling the SUV each morning at Timmys. ENERGY demand is outpacing supply. EVERYTHING will go up in price. Most of our gadgets are made of plastic which is petroleum based too. Until new major sources of stable and easily extracted oil is discovered and more so new refineries are built without environut intervention (Which has to wear a big part of the blame) and the American dollar keeps loosing it’s value, the consumerism religion is on it’s way to extinction.
North America: Get prepared to live like your less affluent European cousins.
The world economy is now global. China and India(And they’re a lot more of them than us!) are joining the “club” thanks in part to all of our collective greed for cheap consumer goods.
In 5 years from now when you go shopping it will be likely for something you truly need instead of “shopping for entertainement”.
Amazing ! It is as if Reuters, Thompson, AP directors from above thought — let me see ? Who/what will we pin the high cost of rice on.
No, won’t blame it on biofuels taking a quarter of the US corn crop. Nor the European policy of demanding food be burnt in their SUVs. Nope, that would be to anti-enviro.
Directions to all media.
Rice shortage due to AGW drought in Australia. Pass it on.
All good obedient socialists will parrot the idiot box line. Some will even appear as guest experts.
But don’t tell anyone the Aussie rice crop, all of it even in a good year, is only about a million tonnes. Total world rice crop ? About 645 million tonnes. (0.15%)
But, oh no. Don’t any of you journos out there question how a 0.15% portion can cause all the trouble. Have to protect Maurice Strong, Gore, Suzuki et al from any critism, ya see.
Too bad, Lorrie Goldstein already has.
The part that really stinks in all this — for a decade, grain & oilseed prices have been below the cost of production. Because of biofuels and hedge funds, grain prices rise sharply. Headlines: Grain Prices Double, Food Crisis.
Hey that’s the CKNX AM920 country&info radio station in my area, Wingham ON. Kate must have great reception to get that AM station in SK!
This is just more CFFO support for the “little guy” with the million $ chicken/milk quota.
The CFFO and the OFA are the saner of the three ag groups in Ontario — you should hear the NFU talks if you like neoStalinism.
This is nothing new — you should read some of the Rural Voice newsletters we get for free. Everything is a major plot by ag corps to crush the little guy..
The only platitude he left out was “social justice”!
Who gives knobs like Small the space to publish crap like this??
Freekin ignoranus!
Posted by: SaskKen at April 29, 2008 2:12 PM
Most people don’t understand the delivery of food in our own country let alone the world. You are correct that retail prices do not reflect farm gate price or even close to it. One of the problems is that government loves big business. There are reasons for that. Like political contributions, appointments to boards of directors and “other” income opportunities.
Another major issue is that retail giants also own the wholesaling divisions. This is how we end up shipping food items thousands of kilometers rather than purchasing local products. With their phenomenal purchasing power they offer opportunities to suppliers at a predetermined price. Theirs. Take it or risk losing the business.
They can make you or break you. Its just that simple. Few people know how few companies control the grocery market. Pretty much anywhere in this country, if you can count to three thats likely more than you need.
http://www.canadianmade.com/grocery.shtml
Bear in mind that those not associated with one of the majors, usually has to use their wholesale divisions. These also include food service divisions as well. So in effect, they control the profitability of the smaller operations as well.
Here’s something I found amusing. Some years ago a fellow who was running truck from PEI to Montreal carrying potatoes (what else eh?) told me of seeing trucks from Ontario unloading at the same facility but all the bags he could see were marked PEI potatoes. When he asked an employee about it, the guy smiled and said “what they don’t know won’t hurt them.”
Those potatoes that are now hauled by trucks from PEI used to be transported by rail. Just thought I would add that.
Greg and SaskKen:
Your anti-business rhetoric is only a few steps away from the anti-market rhetoric of this posts feature item. If you think the big retailers make unfair returns take a look at their EPS and their margins on goods sold – they tell a very different story – that of a hyper-competitive business sector.
I’ve seen this coming for years, the writing was on the wall. It would first start with energy costs, and then commodities and food. Other factors are at play, like the declining US dollar, but that also was predictable. When you’re up to your eyeballs in debt one sure way out is to devalue the currency.
In any event 5 years ago I started growing all my food. I had other reasons too: I’ve had it with hormone-ridden meat, pesticides, antibiotics and all the other stuff. All my friends said I was crazy. Well, today they call me a genius 🙂
I hope out of this we’ll see the small family farms come back.
Posted by: Gord Tulk at April 29, 2008 6:50 PM
I ran several businesses which purchased goods from two of the giants and had occasion to deal with sales and purchasing personnel regularly. This indicated strong gross margin positions for product lines due to extraordinary purchasing power. I also worked as an agent for one of them in a related area for over 2 years and cleaned up some pretty bad financial situations because of poor decisions and lack of knowledge of some of their top local employees. This was petroleum related and not one of their core business interests.
Capital expenditures, expansions and acquisitions factor heavily into EPS as well. I’m not privy to their internal accounting strategies.
It’s not that I’m anti business, just anti business of that size which is predatory. They are not doing us any favors. There were grocery outlets and wholesalers before they came and a lot more local product. I expect I am older than you.
I only remember the board making any money off our sweat. Obviously this Mr. Small who appears to be a wheat board cronie is desperate to keep his snout in the trough.
All this talk about bio-fuels causing high prices is really not accurrate. Yes, it plays a part but what most people dont realize is that when corn is used for ethanol, it is not removed from the food chain.
Dried Distillers Grain is a by-product of ethanol production while makeing up one-third of the bulk of the corn going in, it contains 3 times the protein contained in corn making it a very nitritious animal feed at a very reasonable price.
As far as the real causes of higher commodity prices. A growing global population coupled with the fact that alot of this growing population is growing wealthier, droughts, and a lack of production brought on by years of low commodity prices.
With prices where they are alot of land will be put back into grain production and in a couple years we will go back to cheaper food and farmers going broke.
big agriculture nneds big gov’t
let’s regulate the hell out of this !!
OH we alredy have…………
that’s why we’re in this mess
commoditties ????
jay-mo:
Some of the food-value of the corn remains that s true but only a small fraction of it. the starch energy largely goes into making ethanol. 3 times protien by weight or volume is true but there is far less volume and weight left after the ethanol is made.
POP growth and drought are indeed contributing factors but ethanol/biodiesel demand/production is what pushe the prices up to the levels they are now. Two years ago the US was the world’s largest exporter of corn – 40% of the crop if memory serves. Today it is a net importer. the explosive growth of the Ethanol industry was the reason.
Posted by: ron in kelowna at April 29, 2008 4:45 PM
Amazing ! It is as if Reuters, Thompson, AP directors from above thought — let me see ? Who/what will we pin the high cost of rice on.
Directions to all media.
Rice shortage due to AGW drought in Australia. Pass it on.
Madison Ventures Corp. (Glacier Ventures International)
Directions to all Canadian western small town and farm papers.
Rice shortage due to AGW drought in Australia. Pass it on.
Re: “It’s not that I’m anti business, just anti business of that size which is predatory. They are not doing us any favors. There were grocery outlets and wholesalers before they came and a lot more local product. I expect I am older than you.”
Posted by: Greg at April 29, 2008 9:01 PM
Probably not older than me though, but then, I think I may agree with you in some areas. Especially when predatory and speculative business practices of a few huge international corporations affect millions of people who might not be able to afford food.
As much as I may agree the government can really make a mess of thing, being able to afford food trumps any capitalist ideology. There are situations where a socialist approach is the right one. Any good capitalist would agree.
“There are situations where a socialist approach is the right one. Any good capitalist would agree.”
Name one.
Re: “name one”
How about all of them, or at least the ones with any brains, which is all of the ones I care about.
cop-out
I mean name a situation.
It’s not a cop-out. I don’t have a lot of time.
If there’s no market, there’s no capitalism. It’s “the people” who put the capital in capitalism. If the people have no disposable income because all the money they have is going to food and shelter, our economy begins to implode.
Few capitalists are one man operations, doing everything themselves. They need healthy, educated, trained workers to exploit (I’m not using the word exploit in a negative sense).
So socialized medicine and education both play a role, whether or not we agree it should be monopolized.
I could go on, but like I said …
Jibber-jabber. Socialized Medicine doesn’t work nor does socialized education – market forces for both exist and allowing a market to address them is the best way. When you get ime perhaps you could check out Milton Friedman’s writings on vouchers and Health spending accounts.
Well hundreds of millions would disagree. And I’ve only used a couple of examples. There are many, many more. The fact neither of these examples is perfect, both could be improved, and private investment can play an important role doesn’t mean they don’t work. Actually they work very well, otherwise I wouldn’t be able to write or post here, or anywhere.
The problem I have with the left wing ideologues is that they refuse to consider private for profit business playing any role in socialized health or education because they are more interested in their ideological position than they are in doing what works best for the people they claim to represent. I have a similar problem with those “capitalists” who reflexively refuse to consider anything attached to the word socialist as good for them, or the people they claim to represent.
I’m not saying you’re doing that, but you’re missing the point. And I think you’re just spoiling for a fight, not a debate, so this will be my only word on the subject.
It’s in the market’s interest to ensure everyone (or as many as possible) has a good education, and are healthy, and able to perform the work the corporations require. The more people there are that work and earn a living, the bigger the market. It’s simplified, but really it’s pretty simple.
The government is the people, or represents the people, all of the people, and so are far better positioned to ensure everyone potentially has equal access to and receives a decent education, and has access to health care.
The private sector can certainly contribute, and even make a profit doing so, but, ultimately, the company’s only allegiance is to itself, and their interest in any form of socialism is entirely self-serving, and not necessarily beneficial to society as a whole. Their involvement needs to be managed by the people.