The Research Lead with Agri-Food Economic Systems suggests, with Canadian oilseeds under increasing trade pressure, an oilseed strategy can help. An Independent Agri-Food Policy Note and accompanying Policy Concepts Paper, released by Agri-Food Economic Systems, examines the pressures facing Canadian oilseeds including China's 100 percent tariff on canola oil and canola meal, trade action on Canadian peas from China and now India and issues with China and the U.S. over soybeans.
Research Lead Dr. Al Mussell suggests Canadian oilseed producers are extremely export dependant but that's not a bad thing.
Quote-Dr. Al Mussell-Agri-Food Economic Systems:
That's not a disadvantage. We're blessed with tremendous agricultural productivity relative to the domestic population of people that we have to feed so it's an absolute advantage. At this point, this season farm prices are low.
It's a little bit different on the livestock and meat side but on the grain and oilseed side prices are low but, more generally in the world, food is scarce.
We're under direct pressure in terms of tariffs that have been raised against us by China but China is going to need Canadian canola. I don't think it is in their interest, and I believe they actually understand this. It's not in their interest to have a heavy tax that they put in our product so that it destroys our industry.
I don't think that's what they have in mind so we don't have to be concerned about that. We just need to be able to get through and survive the short term with this and that's the trick of it.
Dr. Mussell says, as you have reduced demand due to tariffs, every participant in the supply chain has less to work with and at the end of the day it all runs back to the farm in the form of a lower farm price. To access the Independent Agri-Food Policy Note visit agrifoodecon.ca.
Click here to see more...