HomeMy WebLinkAboutThe Citizen-Agriculture 2000, 2000-03-15, Page 39THE CITIZEN, WEDNESDAY, MARCH 15, 2000. PAGE A-15.
Workshop opens debate on management concepts
By Janice Becker
Citizen staff
New marketing systems, manage
ment concepts and planning methods
have impacted the amount of control
of family farmers as they move to
incorporate new ideologies.
To better understand how farmers
were dealing with and perceiving
changes, the Christian Farmers
Federation of Ontario (CFFO) held a
workshop in Wingham recently to
see just ‘Who is Running the Farm?’
Those present voiced opinions on
matters ranging from genetically
modified organisms (GMO) to
investment agriculture. Several com
modities were represented in the
group, including cow/calf opera
tions, poultry, hogs, cash crops and
organic farming.
The intent was to determine how
various management concepts affect
the running of the farm. Facilitators
asked how those concepts have
enhanced or limited the farmers’
ability to make decisions.
Tony ten Westeneind of Guelph,
who is involved in business develop
ment and training with a background
in stocks and commodities, detailed
each management principle before
opening the floor to discussion.
Technology Use Agreements
ten Westeneind said an example of
a technology use agreement (TUA)
would include the instance where a
farmer would sign an agreement
with a seed company indicating the
harvested crop would not be used to
re-seed.
“This protects the company’s
investment in genetic modifica
tions,” he said. “Fifty per cent of
farmers planning to plant corn will
use Bt corn and 20 per cent of the
soybeans will be GMO.”
In the case of soybeans, the crop
must be bought back by the seed
company if elevators will not accept
them,” he added, ten Westeneind
said he sees little benefit from a
TUA unless it benefits the farmer to
use that seed due to specific condi
tions on the property. The main dis
advantage is that the seed cannot be
used, but this really only affects soy
beans, he said.
Don Ahrens of the Chesley area
said he sees TUA as a control factor.
Walton-area pork producer Dave
Linton said he had considered using
TUAs for GMO crops to alleviate a
specific problem in a field. However,
the problem he saw was that he
might not have a choice of meat
packer if they asked for proof of
non-GMO in order to pay a premium
price for his hogs, he said.
There was also discussion about
the lack of cost benefit realized
because some crops had to be
sprayed twice.
There was concern expressed
about the possible overuse of chemi
cals in Bt corn or Round-Up Ready
beans, as the inherent toxins were at
a higher level than what would nor
mally be placed on a field. Some
producers did agree the GMO prod
ucts such as Bt corn were much
healthier, there was less mold in the
crop and they felt better about feed
ing it to their animals. However,
there was still the worry as to
whether they could sell the commod
ity.
(Six of the 19 gathered had signed
TUAs.)
Environmental Farm Plans
An Environmental Farm Plan
(EFP) is a voluntary program for
farmers to assess their operation for
pollution hazards.
Animal Council) in 1992, the plan is
often completed with workbooks
provided through workshops. To
date, 15,000 workbooks have been
distributed at 1,100 workshops, said
ten Westeneind. Ten thousand farm
plans have been reviewed and 6,900
claims paid by the government to
improve pollution hazards. The $9
million spent by the government has
leveraged $36 million to better envi
ronmental conditions, he said.
The disadvantages of cost outputs
and no immediate business gain are
balanced by a clean environment
which allows the farmer to identify
safer conditions for his family
through water, wells and drainage,
said ten Westeneind.
With $7 million remaining in the.
program the government plans to run
the project through 2002.
One attendee said he had not com
pleted an EFP because it was like a
“public confession for oneself. I
would be afraid I would find some
thing I could not live with and could
n’t afford to repair, in both money
and time.”
Confidentiality bothered some and
though Bill Van Geest, workshop
facilitator for CFFO, said they were
kept private, there was skepticism.
They also believed the $1,500 pro
vided to undertake environmental
improvements could be used for pur
chases or work which may not be the
priority for the farm, but for work the
operator preferred to do.
Nutrient Management Plans
Nutrient management plans are
specific standards for nutrient man
agement set by a third party, said ten
Westeneind. The plan documents
nutrients spread on the land, includ
ing manure, fertilizer and biosolids.
Seventeen counties have set
bylaws regarding NMP which can be
given to townships to adopt.
Designed to deal with livestock,
operators must have an NMP (in the
areas which have bylaws) before
they are given a building permit to
expand. The disadvantages of
NMPs, said ten Westeneind, is that
there can be odour issues even
between farmers and it limits expan
sion. There is also a concern for the
non-farm voice and the fact that
bureaucrats are in control.
There were questions about the
follow-up once the building permit
was issued. Van Geest said there
was increasing pressure to do plan
ning and he believes the monitoring
will also increase.
While some felt tighter legislation
was needed to control nutrient man
agement, there was also a fear , the
same legislation could make it more
difficult for independents to com
pete.
Concern was expressed about cor
porate farms and the seemingly sin
gular interest in the animals rather
than the land.
While local Huron County issues
of nutrient management were briefly
discussed, it was conceded ‘acts of
God’ could have an impact on com
pliance with NMP legislation. It was
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soil conditions could appear appro
priate for spreading, a surprise
downpour could result in excessive
run-off.
Linked Production Systems
ten Westeneind described a linked
production system as one in which
there was a long-term commitment
to the supplier of inputs or to the
next step in the production. Three-
site hog operations were good exam
ples of linked production , he said as
each step relies on the previous one
to continue. The contention that
three-site operations were reported
to have the lowest cost of produc
tion, was strongly disputed by pork
producers in the crowd.
The advantages of Jinked systems
included stable production, control
and consistent quality. However, it
also resulted in producers being
‘locked in’. “There is a huge ele
ment of tru^t involved,” said ten
Westeneind. “If one link is out, the
whole system can collapse.”
In support of the family farm, one
participant said a linked system turns
the farmer into a cash cropper rather
than growing the crops for the live
stock. “The company brings in the
feed to ensure a quality product then
I need dryers to deal with my crops,”
he said. “It does not support the land
base.”
Several producers said they were
more efficient than loops, provided
everyone got the same price for the
product. It was suggested loops
require farmers to go too big.
Farmers have to look at the differ
ence between income and expenses.
Others said they wanted to main
tain their independence and make
their own decisions.
One man said that in links you are
dealing with people who only want
the profit or a return on their invest
ment. The work and risk all belongs
to the farmers.
(Only one of the 19 participants
had a linked production system.)
Investor agriculture
Investor agriculture is a concept
where an equity investment is put
into a farming venture and the
investor requires both some control
and a return on investment. This is
usually done through ‘common’ or
voting shares in an incorporated
company.
ten Westeneind said this is most
often seen when processors invest
with producers, feed companies
invest in farms to guarantee the sale
of their feed or foreign farmers
invest abroad.
While investor agriculture pro
vides low-priced money for expan
sion or maintenance, all investors
have control proportionate to the
amount of the investment.
One attendee said he was afraid of
investors as they could pull out if
things got bad. All could be lost
quickly. Others felt investor agricul
ture could result in' over production
because a poorly-run operation could
continue if it was supported by a
large investment. “It keeps people in
who should be out.” said Linton.
There was also a concern about
farmers running on borrowed time
and money through the leasing of
equipment which could not be
afforded. There would be little equi
ty in the business.
Linton questioned where the prof
its from such an enterprise would go.
“The local guy spends his money
locally. Profits go out of the commu
nity (with investors).”
Marketing contracts
A marketing contract is a one-on-
one written agreement that locks in
the sale of the commodity.
Processors and farmers use these
agreements to guarantee volume,
quality and delivery, said ten
Westeneind. “There is an incentive
for good quality hogs and a dis
incentive for bad quality,” he said.
“It is also used in forward contract
ing for crops.”
ten Westeneind said currently 70
per cent of hogs are contracted and
only about 20 per cent of grains due
to poor prices. Frozen vegetables
and edible beans are almost all con
tract.
The advantage of marketing con
tract is the security of a place to
deliver the production. However,
there is no flexibility to deliver any
where else.
Some producers expressed dislike
for market contracts as there is a
commitment to a specific elevator
for the quantity and farmers are “on
the hook” for any shortfall. “I have
all the risk and they are guaranteed
the product,” said Ahrens.
(Thirteen of the 19 participates had
or do use contracts.)
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Assurance Programs
The use of branding, such as VQA
(Vintners’ Quality Alliance) on
wines or Orchard Crisp on apples, is
a recognizable symbol for the con
sumer. It is a set of quality standards
that create a brand.
To obtain any of the brandings, a
product must meet all the standards
set by the organization. For Orchard
Crisp, apples must reach,.the mark on
storage method, colour, pressure
testing, size and food safety stan
dards.
Labeling of wines with the VQA
logo has resulted in the product
becoming known around the world
and improved the local perception
of Canadian wine, said ten
Westeneind.
Branding enhances the incentive
to produce a higher quality product
as the fanner benefits from a high
price and consumer recognition, he
noted. However, it can be costly to
meet the standards for branding.
Linton suggested that some brand
ing can be purely for marketing pur
poses. Stating a case in the United
States where pork is branded with a
name like Freedom Pork, based on
the square footage per animal and
the farmers receive premium price
for the hogs.
(Two of 19 were involved in
branding.)
Market Driven
Food Safety Standards
Food safety standards are an audit
ing method which should guarantee
food quality through the vertical
food chain, said ten Westeneind.
One system which has become
very familiar in recent years is
Continued on page A-19