Feds axe ag adaptation councils

The federal agriculture department has stunned farm leaders by suddenly axing 13 agricultural adaptation councils.

John Kikkert, chairman of the Ontario Agricultural Adaptation Council, said he was caught by surprise when he was first informed on Wednesday. He is a director from the Christian Farmers Federation of Ontario.

There has been no news release from Agriculture Minister Gerry Ritz who is usually quick to jump on any opportunity to tout his department's activities, particularly doling out grants and loans.

The councils have been been told all projects must end by October, 2013, so they still have some time to dispense remaining funds. The councils must be completely wound down by the end of March, 2014.

The Ontario council employs 13 people at its offices in Guelph and has dispensed $140 million in federal funds for more than 560 projects since it has established in 1995.

It also administers three programs funded jointly by the federal and Ontario governments under the Growing Forward program. They are programs for Farm Innovation, for Agriculture Biosecurity and for Food Safety and Traceability education. That final program has used up all its funds.

The federal government says it intends to operate the program out of a central location, but doesn’t say where, although most people expect it will be Ottawa.

Kikkert said the government has given no reason for ending the councils.

At every annual meeting except the last one in December, federal officials and/or politicians have been lavish in praising the effectiveness, efficiency and integrity of the Ontario council.

The Ontario council has also won consistent praise from auditors.

Ontario hosted people from all 13 councils during its annual meeting in December “so we could share best practices and learn from each other,” Kikkert said.

There is one council for each of the 10 provinces, but two in Quebec where one is for farmers and the other is for processors, and ones in the Yukon and Northwest Territories.

Kikkert said the council is one of his favourite farm organizations. “I love it.”

It brings together leaders from all commodities. It ensures that funding for research and other projects is immediately and widely shared with farmers and processors, he said, “and it is regional compared with the silo mentality in Ottawa.”

He said the councils are meeting a key objective of the Harper government of “making all commodities more competitive in world trade.”

So, Ritz, I'm sure there are a lot of farm leaders who would like to hear your reasons for axing the councils.

Loans for under-40 farmers

Farm Credit Canada is setting aside $500 million to loan to farmers less than 40 years old.

Agriculture Miinister Gerry Ritz said “encouraging young farmers to invest wisely and contribute to a prosperous, modern sector is not only good for agriculture but good for Canada.”

I hope FCC increases its provisions for bad loans to cover this new, risky venture.

“Agriculture is a key driver of jobs and economic growth here in Canada, and young farmers are vital to the long-term prosperity of the agriculture industry,” Ritz said.

Young farmers will be eligible to borrow up to $500,000 to purchase or improve land and buildings, said FCC president Greg Stewart. 

I wonder if it's significant that he did not mention quota. And I wonder how this enhances the FCC's practice of sometimes lending up to the full purchase price for land.

The loans are available at interest rates as low as prime plus half of one per cent. That, of course, is courtesy Canadian taxpayers who back the government loans to the FCC.

There will be no loan-processing fees. So guess who will cover the administrative costs that don't disappear simply because the FCC doesn't charge a fee.

The FCC will also sell life insurance and accident insurance to those who want it. Some private-sector mortgage lenders don't give borrowers that choice.

It's long past time that the government unloaded the FCC into the private sector. Surely taxpayers have shouldered enough risk and writeoffs already.

Ontario had a loan program for young farmers that was introduced during the 1952-53 fiscal year and was called the Junior Farmer Establishment Loan Program.

The loans were granted by a crown corporation and were backed by Ontario government bonds.

Maybe Ritz and Stewart should research the reasons why the program was terminated in the 1990s.

Ritz spins CFIA cuts

It took four days, but Agriculture Minister Gerry Ritz finally wound up his spin doctors to respond to criticisms from two unions representing workers at the Canadian Food Inspection Agency and the top-level attention the unions gained from national news media. 

 Ritz said by way of a news release that “the Agency will not make any changes that would in any way place the health and safety of Canadians at risk.”

He had nothing to offer to back up that bold claim.

 He said “in fact, Economic Action Plan 2012 includes an additional $51 million over two years to enhance food safety, building upon the $100 million in last year's budget.” 

That $51 million has been announced at least three times over the last six months and was hardly budget news.

By union reckoning, the Canadian Food Inspection Agency's budget will decline by $21.5 million and 234 positions.

The Professional Institute of the Public Service of Canada represents veterinarians and the Public Service Alliance represents front-line meat inspectors.

"Make no mistake that food safety costs money, but less safety can cost a lot more, but in terms of money and human suffering," Public Service Alliance union head Bob Kingston said.

The agency's 2011-12 spending plan proposes to lower its overall budget by a total of $21.5 million and reduce staff by 234 positions, Kingston said.

The bulk of those savings will come at the expense of the food-safety program. The CFIA spending plan proposes a $21.1-million cut to the food-safety program and 207 fewer staff.

But Kingston warned the cuts could go even deeper.

Departments across the federal government have to find ways to reduce their spending between five and 10 per cent.

"If Ottawa proceeds with the cuts it has already announced, plus another 10 per cent, the federal government will be playing roulette with the health of Canadians," Kingston said by way of a news release.

The Professional Institute has posted a video on its website urging Canadians to lobby politicians to retain food-inspection budgets and staff.

Somewhere in the midst of all this spin-doctoring, there might be a grain of truth. But there's no GPS to guide the public to that grain.

Sofina buys Fearmans plant

Sofina Foods, a privately-owned meat-packing company based in Markham, has bought Fearmans Pork at Burlington.

The hog-slaughtering plant was purchased by Sun Capital Partners of Florida from Maple Leaf Foods Inc. in late 2010. 

So much for the "insiders" who told me less than two months ago that the investors from Florida are in for the long haul.

Sofina Foods, has 11 meat-processing plants and "this acquisition provides Sofina with secure access to high-quality raw materials that will allow us to grow our fresh meat markets and build and sustain our further-processed protein business," said ceo Michael Latifi .

"Management has effectively created an infrastructure and stabilized hog procurement, which assures the region's hog farmers that they have a committed and capable partner," Sun Capital co-CEO Marc Leder said in Tuesday's news release. "Sofina Foods is a natural steward for the next stage of (Fearmans') growth."

Sofina purchased Fletcher's Fine Foods in 2004 and Lilydale in 2010.

In March it added Janes Family Foods and Santa Maria Foods, both in Ontario.

Traceability proposals posted

Six years after federal, provincial and territorial ministers of agriculture reached agreement on setting up traceability for the livestock and poultry sectors, the Canadian Food Inspection has posted its proposals to make it happen.

They were posted on the CFIA website on Good Friday.

Why such haste?

The notice invites public comment by May 3 on proposals to identify the farms where livestock and poultry are produced, to trace the movement of livestock and poultry and outlines how the agency intends to handle information and privacy issues.

                           

Pork value chain

It's nice to see that the Ontario Farm Products Marketing Commission has brought hog processors and the marketing board together to talk about value-chain collaboration.


Fearman's and Quality Packers provided a report during the recent annual meeting of the Ontario Pork marketing board, but it's significant that Conestoga Packers, the third-largest in the province, did not attend the initial meeting.


Calling this a collaborative value chain initiative is a nose-stretcher. It's really little more than talk about ways to get past the most damaging aspects of the currently-fragmented supply chain.


What's really missing in this venture is leadership to focus attention on consumers. In Canada, that's the big three supermarket chains.


But what is quite possible is to develop value-chain management with an overseas customer such as a retail chain in Japan.


Maple Leaf had an initiative going with its packing plant in Lethbridge, Alta., tied in with specific genetics and feeding programs at Hutterite colonies and a DNA-based traceability program.


There are opportunities to make value-chain management work for Ontario's pork industry, but so far all we've got is some weak good intentions and some hot air.


The Ontario Farm Products Marketing Commission is also chairing the new Chicken Industry Advisory Committee. There, again, there is only some weak good intentions and a lot of hot air.


Heck, the chicken guys can't even understand that their most advanced value chains have been pioneered by the province's smallest chicken processors who are tightly focused on consumers in niche markets, such as organic chicken.


Their main initiative now is trying to shut down inter-provincial movement of chickens, an initiative that has absolutely nothing to offer in terms of improving consumer satisfaction.


And Maple Lodge, the second-biggest chicken processor in the province, is waging war with Sunnymel in New Brunswick.


In other words, the real action remains in fragmenting the chicken supply chain, not on satisfying consumers.

U.S. Pork producers threaten trade action

Ontario’s risk management program for livestock producers has barely begun and already the National Pork Producers Council in the United States is threatening trade action.

Council president R.C. Hunt has sent a letter to Congress urging opposition to Canada being allowed to join the Trans-Pacific Partnership free-trade talks.

He says it’s not fair that Canada subsidizes hog farmers who compete with U.S. producers for export markets.

He calls the Ontario risk management program a violation of Canada’s commitments under the World Trade Organization and threatens to use U.S. countervailing duties against Canadians.

His letter says nothing about the U.S. violation of World Trade Organization standards with its Country-of-Origin Labeling (COOL) regulations that have, and still are, pressuring Canadian hog prices lower.

Hunt points to an analysis by Dermot Hayes an economist at Iowa State University , to claim that  Ontario’s Risk Management Program will hurt U.S. hog farmers by $162 million and the loss of 1,299 jobs. But that's over 10 years - in other words, a straight guess about a miniscule issue.

“The RMP is just one of Canada’s support programs, all of which have a substantial negative impact on U.S. pork producers,” wrote Hunt. Really? Name some.

“The willingness of the Canadian government to repeal these trade- distorting hog and pork programs must be part of (U.S. Trade Representative’s) assessment of Canada’s eligibility for membership in the TPP negotiations,” Hunt says.

“Unless Canada undertakes such a commitment, the U.S. should not consent to its participation in the Trans-Pacific Partnership talks,” Hunt wrote.

Federal Agriculture Minister Gerry Ritz has been outspoken in refusing to put any federal money into the Ontario RMP, and Ritz has repeatedly warned that the Ontario program could lead to trade retaliation.


But let's hear somebody in Canada speaking up to Hunt. Maybe he's a Republican running for the presidential nomination. How else to do you explain such wackiness?