Wednesday, November 15, 2017

Research spending is shrinking

The federal and provincial governments have cut their research funding, according to the annual report from the federal agriculture department.

Federal spending declined from $404.5 million in fiscal 2015-16 to $387.7 million in fiscal 2016=17
Provincial spending on research and innovation declined from $195.2 to $169.6 million.

Measured as a percentage of the value of farming, the declines are even greater and extend over a long period of time.

What's more worrisome is that the cuts to basic research have been even greater, meaning that Canada is highly unlikely to have a competitive advantage in the coming decades.

The trend to reduce trade barriers makes this even more worrisome for future generations of Canadian farmers.

Government subsidies are also on the decline, both in dollars and percentages of farm income.

However, even with the delines, government spending on subsidies and services amounted to $15.4 billion last year, which is 24.2 per cent of gross domestic production from agriculture.

Subsidies declined throughout most of the 1990s, but increased from 1998-99 to a peak in 2003-4, mainly because of Bovine Spongiform Encephalopathy which cut off all beef exports.

They have been steadily declining since that peak.

Exports are becoming more important as a percentage of agriculture income. The U.S. is still the biggest customer accounting for 53 per cent, but it is also Canada’s biggest supplier, accounting for 59.6 per cent of agriculture and food imports.

China is surging as a customer and last year bought more than $6 billion worth, about $4 billion of that oilseeds and oilseed products.

There are now 190 companies involved in industrial bioproducts, employing 5,618 workers and marketing $4.27 billion worth of products, of which biofuels total $2.72 billion. Forestry is included in those figures.

Canadian agriculture and food had $111.9 billion in gross domestic product last year, which is 6.7 per cent of the Canadian total, and employed 2.3 million workers, which is 12.5 per cent of the Canadian total.

The full 127-page report is available on request from the federal agriculture department. It has many graphs, but few charts that provide detailed multi-year statistics.


It provides broad overviews, but no commodity-by-commodity numbers with multi-year comparisons.