There is a lot a interest and conversation within the agricultural community about farmers talking to customers. There are commonly calls for farmers to step up and educate the public about food and issues that face farmers. That’s one of the primary reasons I’m writing this blog, and has been discussed in some of my past entries. So my ears perk up anytime I hear about local farmers in the local media or participating in public events such as fairs, parades and open houses. So yesterday when my mom told me that my Uncle had written a letter to the editor in the local paper I instantly tried to find it online, with no luck, so I got her to send it to me.
Food crisis not a simple issue
To the editor
Re: Food Crisis here before Bio-fuels
In the Feb. 11 article “State of Their Union”, Mike O’Leary refers to the US Government’s support of bio-fuels – “Even though they have caused a food crisis world-wide.” Like many others, I had the initial reaction of how foolish, if not immoral it is, to divert food from starving people, in order to fuel our North American automobiles.
If only it were so simple!
I believe that the World Food Crisis, O’Leary is referring to is the dramatic (but also short lived) run-up in com, soybean and wheat futures, which occurred, in early 2008. The phenomenal increase in commodity prices had farmers dreaming of riches, but in fact had very little to do with what farmers received or what end users were willing to pay for crops. At that time the number of futures contracts held by investors outside of Agriculture skyrocketed. Enormous sums of money now betrayed by hi-tech stocks and then fearful of the housing market, moved to buy commodity contracts such as gold, oil, corn, wheat and soybean. At the same time world wheat reserves reached I record lows due to drought in Australia and a crop failure in much of central Europe. While the nightly newscast reported the dramatic increase in the cost of wheat, the simplistic view emerged that ethanol made from grain must be the villain. In fact, in North America our ethanol plants are fuelled primarily by com, not food grade wheat.
In my view the real crisis is the disparity of income throughout the world, not a lack of grains. We Canadian taxpayers recognize the need to provide aid when needed, be it a refuge camp in Ethiopia or to an unemployed family in our own community. In doing so, let us recognize that the root of the problem is the lack of the ability to earn an adequate income, rather than imagining a world food shortage because we are using crops to make
fuels. I don’t pretend to know how to solve starvation in much of our world. We, as North American farmers would like to be part of the solution. However, we cannot continue to produce surplus commodities, be it corn, wheat, beef or pork, only to dump it onto a world market, with returns less that our costs of production. While crop shortages may make news they are short lived, while grain surpluses last for years. Our productive capacity in North and South America and most of Europe is enormous. The wheat shortage of 18months ago is gone. At present the North American year-ending stocks for wheat is projected to be a whopping 40 per cent of annual usage. Today, Ontario produces three time the amount of soft wheats, which we can use. The rest has to find a market somewhere else in the world (ie. Egypt) where we must match the lowest price in the world.
In other industries if there is a surplus, industry reacts by closing factories and reducing supply. In Agriculture when we, as individual farmers, see a decline in prices we react by saying, “Well in order to pay our bills we must produce more.” Rather than asking Government (taxpayers) to subsidize Agricultural exports, only to compete against the primary producers in impoverished nations, we are actively seeking new industrial markets for our products. The soy house now being completed here in Acton is an example of the innovative work being done. We are manufacturing superior, environmentally friendly products made from agricultural crops. Only through such innovation and diversification can North American farmers continue to be economically viable. The truth is, producing food alone does not pay very well! The use of agricultural land to produce non-food crops in not new. In the southern United States cotton has always been a major crop grown on nearly ten million acres. I’m told that prior to 1950over 15percent of all cropland was used to grow “fuel” for horses just to power farm implements.
We read so many articles, which find fault with whatever new energy source is proposed. Let us recognize the positive impact of renewable, clean, and affordable. Made in Canada bio-fuels.
I think its a good example of what more farmers need to be doing, starting a conversation about farmers at the dinner table.