Good year for agriculture, well, we can hope

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This time last year, COVID was just a minor disease outbreak mostly confined to China, but it was spreading. 

Back then, Dr. Tam, the Canadian Chief Public Health Officer, was pronouncing that facemasks were not necessary, travel from China was okay and that we should stop stigmatizing Chinese people. 

What was she thinking, it now boggles the mind. 

Regardless, the COVID pandemic has devastated the general economy except one industry, that being agriculture and food. 

Although, a couple of agriculture sectors did get sideswiped but not of their own doing. 

Beef processing and harvesting of some field crops received setbacks from COVID caused by labour problems. 

From a consumer perspective, there were never any real shortages of essential foods, and the North American food supply chain was resilient and reliable. 

Those involved in the industry worked hard to make it so, for which, in my opinion, they received little public gratitude. 

Not surprisingly, for overfed spoiled consumers, their biggest fear was a shortage of toilet paper.

For primary producers, COVID had different marketing impacts. 

The most obvious was at the cattle feedlot and beef processing sector. Temporary plant closures set their finely tuned supply system back from which that sector is still recovering. 

The reduced flow of temporary foreign workers did impact sectors like horticulture. 

One thing for sure, the entire agriculture and food industry has learned from the pandemic, which will make recovery better and quicker. 

I expect the food processing and distribution sector has plans to incrementally adjust to the return of the restaurant and hospitality. 

The virtual overnight demise of that business caused havoc and considerable financial losses. 

That recovery may not start for another six months into the new year. 

The pace of the 2021 recovery is entirely dependent on the pace of COVID vaccinations. 

That will affect most food products’ marketing, tempered of course, by any potential impacts of calamitous weather or some other unexpected disaster.

Alberta had an excellent cereals, pulses, and oilseeds harvest, especially compared to the previous year’s harvest from hell. 

Luckily for Canadian growers but unlucky for growers in Russia and Ukraine who faced harvest yield disasters last year, grain prices are stable and increasing. 

Even canola, which faced the loss of the massive Chinese market last spring, has recovered. China has quietly reinstated its canola imports to traditional levels. Those imports could still be impacted by Chinese government hostage diplomacy and the captive Chinese princess saga.

Mercifully and hopefully, that madness will end in 2021. 

The beef industry will recover, and it may see significant price increases thanks to the recovery. 

Much will depend on how quickly the restaurant and tourism industries recover. 

Finance sector observers have noted that there are billions in pent up spending intentions by consumers due to COVID. 

I expect once that is unleashed, the restaurant demand will explode. Those in the food industry that have been stockpiling frozen high-end meat cuts will probably do well in 2021. 

Money has been made in the grain and oilseed sector, which bodes well for the crop input business, which will see even better yields if the weather cooperates. 

Additionally, the massive increase in rail movement to west coast grain terminals started in 2020 could make 2021 another stellar year for that sector.

Are there clouds on the horizon? Alas, there always seems to be, thanks to an ideologically driven federal government. 

The feds are determined to increase the carbon tax, which will increase costs to the agriculture and food industry supply chain. 

Even that might be tolerable if the new President Biden administration would apply the same carbon tax to the American economy. 

To be fair, the latest Liberal Climate Change policy update does contain some interesting initiatives. 

There is $631 million for carbon sequestration projects; that may involve paying landowners to watch grass grow, but it’s a good step that recognizes that agriculture can play a big part in burying carbon. 

However, there are suspicious new programs have vague intentions. 

There is $98 million for a program called “Natural Climate Solutions for Agriculture Fund.” God help us that isn’t code for a slush fund for the usual cabal of organic green eco-socialist lobby groups. 

Consultants must be drooling at the prospect of more off the wall studies.

In the end, after enduring 2020 and all its calamities, 2021 should be a lot better, or so we can hope. 

God bless us all in the new year. 

 

by Will Verboven

Will Verboven is an agriculture opinion writer and policy advisor. willverboven@hotmail.com.

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