The Rural Voice, 1990-01, Page 23JIM McINTOSH
McINTOSH POULTRY FARMS LIMITED
FREE TRADE
The new term for the Free Trade Agreement is CUSTA
(Canada/U.S. Trade Agreement). However, many in Canadian
agriculture claim it should be named only USTA, as any increase
in cross-border agricultural trade between Canada and the U.S. has
been on a one-way street...
Which farmers will be hurt the most by CUSTA? In my
opinion it will be the farmers producing commodities that are not
protected by supply -managed boards and by import controls.
Why? First, the U.S. is 10 times larger than Canada. Second, the
U.S. government and large, agriculturally oriented American
corporations are taking a very aggressive production and export
enhancement position. Third, the U.S. could use the Canadian
market as a loss leader sales outlet to eliminate our production.
However, Canadian farmers producing under supply -managed
boards will have a serious and lengthy battle on their hands to
maintain their share of the Canadian market. Canadian farmers
can compete with any other farmer in the world, provided they
have the same costs for interest, taxes, fuel, chemicals, equipment,
and labour. But Canadian farmers cannot compete against the
financial reserves of a large integrated corporation.
FARM FINANCING
All levels of government have subsidy programs for industry,
from municipally owned and developed industrial parks to billion -
dollar subsidy payments to the big auto manufacturers. Agricul-
ture as a major employer in Canada deserves some assistance as
well. The beginning farmer has a financial tightrope to walk for
the first 10 years of operation. This 10 -year period is when an
interest -rate reduction program should be made available.
The FCC should again be expanded to be a major lender to
agriculture on a very competitive basis. Also, the FCC should
develop a mortgage -insurance program that would be available as
a guarantee of private mortgages on farm properties. This would
allow a retiring farmer to leave some money invested in the farm
earning interest. This would replace the current policy whereby
most sellers of farm property want to receive payment in full, and
then they invest these proceeds in other financial institutions which
have no interest in agriculture. Thus their money earned from
agriculture is lost from agriculture.
PRESERVATION OF LAND
The responsibility to preserve farm land rests with the whole
population of Canada, and not just with the managers of the soil.
With present crop prices and the return on investment in agricul-
ture, the landowner can see no economic reason to preserve farm
land ... I believe that severances should be restricted in agricultur-
al areas and that legislation should be implemented immediately to
preserve Ontario's best farm land. However, the legislation cannot
be brought in without a very generous compensation package for
agriculture, paid for by all residents of Ontario.
THE GATT
Change in world trade is a slow process. Do not look for major
changes in the world trading patterns because of GATT. We may
sec greater changes in world trade because of the restructuring of
the governments in Eastern Europe and Russia. If Russia becomes
self-sufficient or even a net exporter of grains, there will be tre-
mendous economic pressure on the grain farmers of Canada.
Canada will gain on Article XI of GATT
because the EEC will want to use this section to
remain self-sufficient in food production.
THE FEDERAL DISCUSSION PAPER
It is very reassuring that the federal government wants to
develop a long-range plan for Canadian agriculture. However, its
discussion paper must have been written by a gaggle of economists
who knew very little about grassroots agriculture.
For example, one statement: "The relatively good shape in
which the industry finds itself today ..." How can they be serious
when total farm debt in Canada is still $22 billion, which places
total debt at a higher percentage of total farm assets than at any
other time in recent Canadian history.
JOHN GAUNT, DIRECTOR
ONTARIO BEAN PRODUCERS MARKETING BOARD
FREE TRADE
Free trade is a necessity
from a white bean producer's
point of view. We live by it.
The proof of this is the fact
that approximately 80 per
cent of Ontario white bean
production is exported. We
are, have been, and likely will
be competing quite success-
fully on the world market.
No doubt there will be
some painful periods for
everyone (both in Canada
and the U.S.) as we adjust. However, these difficulties are
inevitable, regardless of whether we have free trade or not.
FARM FINANCING
I am not at all convinced that exceptionally easy credit, espe-
cially at subsidized interest rates, is much of a benefit to farmers
in the long run. We need only to look at recent history to see the
results of it. Investing long-term money in short-term (gyrating)
markets docs present some difficulties that may result in a need for
ad hoc interest rate relief.
THE ENVIRONMENT
Farmers, and the agricultural industry as a whole, should re-
spond to the concern about the environment with hard facts and the
good, sound, basic practices that we have been using in the past.
... Those individuals involved in the agricultural industry (at
whatever the level) "for the long haul" are generally pretty friendly
to the environment regardless of whether or not there are govern-
ment programs or financial incentives (subsidies) involved.
PRESERVATION OF LAND
I think in instances where there are land severances requested
in food production areas, the required buffer zone around the
severance should be owncd by the outfit requesting the severance.
The offending concern should then be forced to stay completely
within its zone.
FOOD HEALTH
I believe we have top quality, clean and healthy food now
(and lots of it as well). Consumcr concerns and fears should be
JANUARY 1990 21