GFO asks: Where’s our funding?

By Farmers Forum Staff
OTTAWA — The federal government’s announcement last month of $1.75 billion in compensation for the dairy sector exposed some dissension between supply-managed and non-supply managed sector farming.
The very day of the announcement, Western Canadian Wheat Growers Association put out its own press release stating that the “Federal government ignores grain farmers.”

The association’s Alberta director Stephen Vandervalk called the compensation package “shameful,” saying: “It seems that some farmers are more equal than others.”

Ontario ag communications consultant Christina Crowlie-Arklie, who grew up on a dairy farm, tweeted the same day: “Can we not make this an issue within/between our very own #CdnAg sector. It doesn’t serve our own industry very well if we don’t remain united.”

No matter how you look at it, many crop farmers see the compensation for dairy as a sign of an unfair playing field that can lead to a harsh reaction. During the renegotiation process of CPTPP trade deal, one Ontario crop farmer said that among his circle of friends, he was one of the few non-supply managed farmers that didn’t want to see the system gone.

But another crop farmer told Farmers Forum: “I don’t know anyone who wants to see it gone, except people trying to sell raw milk.”

The Grain Farmers of Ontario called the dairy compensation package disappointing. “It is not that we are upset at the dairy industry about getting the money. It’s just that we were forgotten,” said GFO chair Markus Haerle.
Haerle isn’t just a crop farmer; he’s also an egg farmer, another supply-managed industry. He said the gripe of the GFO is that nobody else got help. Soybean growers have struggled with low prices for two years, and canola got whacked this year. Western Canada has had a hard time shipping lentils since India stopped taking them; ditto for Italy and Canadian wheat.

Business Risk Management tools are not working, said Haerle, and they’ve been under review for years, with no real end in sight.

That makes it hard for Haerle to see this latest announcement as anything but an effort to buy votes. “The Liberal government is only addressing situations that are to their benefit at the moment.” It doesn’t hurt that the dairy sector has a powerful lobby: They arguably played kingmaker in the Conservative leadership race, booting Maxime Bernier, who vehemently opposes supply management, in favour of the dairy-friendly Andrew Scheer.

Haerle pointed out that the grain and oilseed sector in Ontario is twice as big as the dairy sector, but nevertheless lacks its strong protections. Supply management is best understood as a business risk management tool, said Haerle, and grain farmers need something comparable.

“A lot of guys don’t even know about the compensation for dairy,” said one 60-something Western Ontario crop farmer, who asked that he not be identified. “For those who do, there is a fair bit of acrimony over that.”
But the acrimony is not against their farming neighbours, he said, but against a system rigged against crop farmers, making it increasingly difficult for crop farmers to operate in a free market when so much of our economy is not. “I try not to throw rocks at my dairy and feather friends.”
He argued that dairy farmers are in a better position to pay higher prices for land, while area crop farmers are not. “These are some of the unintended consequences of supply management.”

He said that he understands the argument for a protectionist dairy sector, adding that without it he can see a day when there is no dairy in Canada, if U.S. dairies are allowed to truck their milk here.

However, as it stands, “Dairy farms are the king of the county and grain farms are going broke,” he said. Since the free market has been compromised, “crop farmers just wish there was some support for us.”

It is understood that dairy is protected for many reasons, including the main reason to ensure a stable price while not overproducing. There is also widespread sentiment in urban and rural areas that dairy is favoured because the federal government wants the support of Quebec. Quebec has the vast majority of dairy farms — over 5,000 — almost half of all dairy farms in Canada. There are about 3,500 dairy farms in Ontario.

“How come these guys get all the support and the grain guys twist in the wind,” the crop farmer pondered aloud. “I think it’s the Quebec factor.”

Renfrew County crop farmer Jennifer Doelman grows canola and soybeans, among other crops. “I don’t begrudge (dairy farmers getting compensation). I’m glad someone got something.” Dairy farmers are important in her local economy, and to her business as well. “The dairy guys are my straw customers.”

But it is something of a “two-class system,” she said. While it makes a lot of sense in protecting farmers in highly turbulent industries from reeling between making and losing money “hand over fist,” she said, it also “distorts the marketplace. Neighbours who can’t buy more quota invest more and more in their property, driving up the price of land.”

So long as the system is uneven, the ag sector can’t speak with one voice, she said. “You can’t really say ‘speak with one voice,’ and some people benefit and others don’t.”