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4 THE RURAL VOICE
Keith Roulston
No more Mr. Nice Guys?
Keith
Roulston is
editor and
publisher of
The Rural
Voice. He
lives near
Bluth, ON.
From farm leaders to ag ministers,
the universal response to the an-
nouncements of aid for farmers was
the same: it will help in the short run
but it's not the long-term solution.
So what is the long-term solution?
It's obvious that farmers must get
more for their products from the
markets. Right now everybody
involved in taking food from field to
plate gets a fixed share, except the
farmer. The person who stocks the
supermarket shelf gets a fixed wage.
The retailer expects a percentage
markup on whatever he pays for
products. The processor and the
processor's employees have fixed
costs or profit expectations.
If prices are high, there's enough
money in the system so there's
money left over for the farmer after
everybody else gets their share. If
prices drop, the slack in the system is
mostly absorbed by the farmer. As
we've seen with the BSE crisis, retail-
ers don't really drop their prices and
their profit levels stay high. Packers
have had record profits. It's the
primary producer who pays the price.
Complicating the situation is the
trend of the new millennium in food
retailing: the fear of Wal-Mart. The
world's largest company is entering
the food business, terrifying the other
players, even mighty Loblaws which
recently closed several warehouses to
try to cut costs. Wal-Mart has made
its reputation on driving costs out of
the system and forcing manufacturers
to take less money which they have
translated into paying employees less,
to the point many shift their
manufacturing to China or India.
Wal-Mart recently purchased a
major U.K. food retailer, and accord-
ing to one British farm publication,
demanded its major milk supplier
reduce its prices. The dairy in turn cut
prices to farmers. If this trend spreads,
farmers will be asked to produce for
even less than they get now.
Only dairy and poultry, through
supply management, have been able
to put themselves first in line to get a
share of the consumer dollar instead
of taking what was left after everyone
else got their share. The World Trade
Organization rules mean that there
won't be any further supply manage-
ment efforts and there will be
continual pressure on what supply
management we have.
All of which means farmers will
either have to live with the rules
dictated by others or be willing to
stop being nice guys. Blyth -area
farmer Mason Bailey, still farming in
his 80s, recalls how the provincial
government in the 1970s said there
could never be a farm tax rebate. But
farmers refused to take no for an
answer and threatened a tax strike
which would have bankrupted rural
municipalities. The government got
pressure from municipalities and
came up with a plan.
Recently Bailey took a new
proposal to the Huron County
Federation of Agriculture which in
turn took it to the Ontario board
meeting. His suggestion points out
two conglomerates control food
retailing, and proposes farmers
demonstrate their discontent with
their small share of the food dollar at
urban food stores and food importers,
continuing until parity with U.S. and
Quebec agricultural producers is
achieved for all sectors of food
production in the province.
There's no doubt this escalation
might turn nasty, but nearly every
achievement of fairness for food
producers in the history of the
province has resulted from impolite
action. Read Jim Powers' A Record
of Achievement to see how nasty
things got for farmers seeking a
single -desk sales tool for hogs.
Farmers have gone along with the
premise they're part of a value chain
and they're going broke because of it.
Obviously they'll only get a bigger
share of food dollars if they fight for
it, and fight dirty if necessary.
Nobody's going to hand it to them.0