Our world appears increasingly on edge. That’s the opening sentence of the latest Canadian Agri-Food Policy Institute report, written just prior to Russia invading Europe’s breadbasket:  Ukraine.  This “explosive development” according to policy experts Al Mussell, Ted Bilyea and Douglas Hedley underscores the urgency of agri-food policy change in Canada. Here is a preview. 

For starters, climate change is complicating the assumptions made in farming practices, and at worst, can undermine existing agricultural systems

Growth in agricultural productivity is slowing.

Internationally, governments are increasingly implementing policies of stockpiling and erecting trade barriers in response to variability and potential scarcity in food supplies.

Sharp increases to energy prices have triggered a range of dramatic adjustments, including increasing fertilizer prices and renewed interest in renewable fuels. 

In 2021, global food prices were at their highest levels since the short-term price spike in the early 1970s, with severe impacts in the developing world.

Increasing demand and variable supply may increase prices for farmers while increasing food insecurity.

The benefits of increased prices may be offset by increased expenses and instability, which may be beyond the scope of existing income stabilization tools.

Canada’s agri-food policy priorities appear to be a combination of largely the status quo and a shift to a strong emphasis on climate change and labour in agri-food. 

An emphasis on sustainability and climate change is needed but it cannot be at the exclusion or expense of agricultural productivity and Canada’s role in domestic and global food security. Agri-food policy must take on a more ambitious agenda that recognizes that important norms and guardrails – established historically, and the basis for current policy parameters – are at risk of being breached.

The erosion of rules-based trade has allowed for sudden and ad hoc barriers to agri-food trade to be raised. The distortions in agri-food trade are increasingly being used as a geo-economic weapon in which open-economy exporters such as Canada are vulnerable. Greater efforts in market access advocacy will help, but Canada needs to adjust its trade policy to recognize these risks by aligning with like-minded countries in using market leverage to mitigate these risks.

Governments in Canada must find a way to work differently, or create a new policy space, with agri-food firms and exporters to mitigate increasing risks from predatory trade disputes or acquisition of Canadian agri-food assets by others whose interests are not aligned with Canada’s. Canada’s agri-food firms can be injured financially by the actions of other countries, and its productive assets taken over by others with nationalistic interests in food extending beyond marketing and profit-seeking. 

For the 14-page report, link here: https://bit.ly/3NCtMYT

Source:  Canadian Agri-Food Policy Institute March 25, 2022 release