November 2006

Index



Thirty Thousand Reasons to Invest in Agriculture

More than 30,000 yellow post cards have been delivered to Premier Dalton McGuinty’s office, asking him to increase support to agriculture and the rural economy – and specifically to implement the Risk Management Program for Ontario’s grain and oilseed producers.

The Farmers Feed Cities! postcard campaign wrapped up at the end of the Outdoor Farm Show. The postcards have helped to raise awareness about the income crisis gripping farm families in a sector that has been economically devastated by record-low world prices. Spear-headed by the Ontario Grain & Oilseed Safety Net Committee, the campaign grew in strength one signature at a time.

The Ontario Grain & Oilseed Safety Net Committee is thankful for the efforts of supporters who took the time to sign a card at community events, farm shows and coffee shops across the province. Many volunteers, rural businesses and industry stakeholders who recognize that their success is closely linked to a strong agriculture industry have helped to make the campaign a success.

While farmers have been raising awareness about a very real and very serious issue, they are not merely talking about problems, they are talking about a solution. The sector is too important to the agriculture industry as a whole to risk losing it because of market conditions. That’s why the Risk Management Program was developed – to provide long-term stability to a critical sector of the economy.

The Ontario Grain & Oilseed Safety Net Committee is asking for the provincial government and the federal government to come to the table and implement the Risk
Management Program to prevent disaster in the rural economy. The post cards represent 30,000 more voices echoing those already calling for the Harper and McGuinty governments to stand up for farm families and the rural economy, and to implement a Risk Management Program.


$185 Million Investment Builds Opportunity for Farmers, Improves Rural Infrastructure

While at the International Plowing Match on September 19, 2006, Premier Dalton McGuinty, who was joined by Leona Dombrowsky, Minister of Agriculture, Food and Rural Affairs, announced a new investment in rural Ontario. The government states that the investment will build opportunity for farmers and strengthen vital infrastructure in rural communities.

The Premier stated that farmers are the backbone of our rural communities and they've helped build a world-class agri-food sector in Ontario. The government wants to continue to do their part to support growth and innovation in the agrifood industry to make sure our farmers and their families find success.

The McGuinty government will invest an additional $185 million in rural Ontario. Of this, $110 million will go directly to farmers to provide transitional funding as we move to a better method of valuing inventory under the Canadian Agricultural Income Stabilization program, and to continue the Self-Directed Risk Management program. Another $75 million will be invested in rural infrastructure.


 Ultimate Solution to Worldwide Price Distortions

In a press release following the Premier’s September 19, 2006 announcement, Ontario’s grain and oilseed producers acknowledged Premier Dalton McGuinty’s $110 million announcement at the International Plowing Match as a first step in addressing the income crisis in that sector. But the key
to long-term stability is the Risk Management Program (RMP). RMP is the ultimate solution to worldwide price distortions.

What Ontario’s 25,000 corn, canola, soybean, wheat and edible bean growers really need is the implementation of a longterm Risk Management
Program. Grain and oilseed producers have seen their incomes buried in red ink in recent years because of damaging subsidies handed out for similar crops in other producing nations, especially the United States. This has kept the world price for these commodities below the cost of production in Canada.

Consecutive years of depressed prices are having an impact. Based on census data, it is estimated that about 1,250 grain and oilseed farmers in Ontario are exiting the industry every year. The federal government estimates that more than 6,000 farm families in Ontario have an income below $25,000.

Ontario farmers don’t want handouts. But they believe that farm families, who work hard to provide a high-quality and healthy food supply to Ontario and the world, deserve to be protected from worldwide market distortions caused by political events beyond their control.

Faced with the lowest commodity prices in a generation, seven provincial growers’ associations formed the Ontario Grain and Oilseed Safety Net
Committee in 2005 to promote the only viable long-term solution: the Risk Management Program. Developed by farmers for farmers, the Risk Management Program is essentially an insurance program administered by the provincial and federal governments with a premium paid by participating farmers. Payouts would be triggered only when world prices fell below a certain level agreed by all participants.

The Risk Management Program was not addressed in the Premier’s announcement but an estimated $30 million is expected to reach some grain and oilseed farmers through the Canadian Agricultural Income Stabilization program (CAIS). And while industry leaders recognize that the province is taking steps to address the income crisis, they are deeply concerned about farm families who will be left out. In fact, some grain and oilseed farmers will not get any help at all because of inherent challenges in the way the program calculations are done.

Both federal and provincial governments have recognized that CAIS doesn’t work for the grain and oilseed sector, yet they continue to use that program to deliver funding. If they want to ensure the long-term stability of the farm family in Ontario, they should get behind the solution that farmers support.

More than 25,000 grain and oilseed producers collectively farm more than five million acres in Ontario. The gross value of their crops exceeds $1.7-billion at the farm gate. These crops are further processed into products for food and industrial use creating more jobs and more economic value – right here at home.

The majority of Premier McGuinty’s $110-million announcement will reach the livestock sector, with $10 million going to the horticulture industry’s selfdirected Risk Management Program. Any investment in the agriculture industry and rural communities is a positive investment for Ontario. It’s important that agriculture is on the provincial agenda.

Although the announcement isn’t exactly what we asked for, the Grains and Oilseeds Safety Net Committee considers it to be an invitation back to the bargaining table to start making real progress in addressing the most damaging problems in the grain and oilseed sector. The Committee will continue to work with Premier McGuinty’s government for as long as it takes to get a Risk Management Program launched.


 Liberal Caucus Unveils Its Plan for Canadian Agriculture

The National Liberal Rural Caucus recently recommended that a new plan be implemented to help farmers face the new realities created by the collapse of the World Trade Organization (WTO) talks.

Domestic programs and policies adopted over the last few years were based on a WTO result that would reduce domestic support, increase market access, eliminate export subsidies and maintain our supply management system as well as the Canadian Wheat Board.

The report of the National Liberal Rural Caucus proposes that Canada needs to establish a long-term and fully funded national food policy. Within that policy, it’s suggested that Canada should strive to maintain a safe and cost effective domestic food supply and establish risk management programming that provides producers protection against unfair trade practices, crop losses and ensure a fair return for producers. It is a recommendation within the report that the Risk Management Program, designed by Ontario’s Grains and Oilseeds sector, be supported.

More details are available on the Liberal website, www.liberal.ca.

CFA Pushes Safety Nets Ideas on Parliament Hill

The week of October 16, the Canadian Federation of Agriculture (CFA) continued its national campaign for better agricultural safety nets programs, bringing the message directly to Canada’s top decision makers on Parliament Hill. The Directors of the CFA, farm leaders from every province and representing every commodity sector, met with Cabinet Ministers and Members of Parliament from every political party in the House of Commons. Representatives also made presentations to the House of Commons Standing Committee on Agriculture and Standing Committee on Finance.

Bob Friessen, CFA President delivered the message that the Canadian Agriculture Income Stabilization (CAIS) does not work for every region and commodity sector in this country.

The meetings on Parliament Hill are part of a larger national campaign to ensure farmer-developed solutions form the basis of the next generation of
agricultural safety nets programs. CFA members have already launched a grassroots postcard campaign which has farmers across the country sending a message to the Prime Minister, the Minister of Agriculture and Agri-Food, and their local MPs.

CFA is urging the federal government to join them in exploring the idea of replacing the top tier of CAIS with a new and improved version of the National Income Stabilization Accounts (NISA) program. The CFA safety nets proposal also includes funding flexibility for regional companion programs because no one national program can address all regional and commodity needs.

In their meetings CFA representatives also touched on other issues of concern to the agriculture industry, including the need for a long-term national plan and the need for a Canadian Farm Bill.


Cash Advance Programs Available for Corn and Soybean Harvest (up to $150,000 interest-free)

OCPA, in partnership with the Ontario Soybean Growers and Agriculture and Agri-Food Canada is offering the ESCAP Cash Advance Program on harvested corn and soybeans for the 2006 crop.

Producers can apply for up to $100,000 interest-free. The loan rate on corn is $65 per tonne and $110 per tonne for soybeans.

OCPA is continuing to offer the fall Advance Payment Program (APP) for corn. Producers can apply for a maximum advance of $250,000 with the first $50,000 interest-free. The loan rate on corn is $65 per tonne.

The repayment deadline for both programs is September 30, 2007.

By participating in both programs, producers are able to apply for interestfree loans up to $150,000. More information is available by contacting the
office at 519-767-4138, 519-837-9144 or by visiting the OCPA website at www.ontariocorn.org.


WTO Rules Against EU Restrictions on GMO Crops

A World Trade Organization panel dealing with complaints brought by the US, Canada and Argentina, finalized a preliminary ruling made in February that the EU’s ban on genetically modified products was illegal but was also in violation of the Sanitary and Phytosanitary agreement.

With this ruling, the WTO reiterated its position that hard scientific evidence on potential harm caused by a product is necessary to restrict trade of those goods.


Premier's Award for Agri-Food Innovation Excellence

The McGuinty government will recognize innovation in the province’s agriculture sector by launching the Premier’s Awards for Agri-Food Innovation Excellence. The objectives of the Premier’s Award for Agri-Food Innovation Excellence
are:

• To recognize and encourage innovators in the agri-food sector
• To foster innovation in the agri-food sector that has an effect at the farm level
• To raise awareness about the importance of agrifood innovation, and its impact on the Ontario economy, particularly in the global market.

Examples of innovation include, but are not limited to, the following:

• Improved farm practices (e.g. technology, business practices, processes, etc.)
• Response to consumer demands (e.g. value added, marketing, strategic alliances, etc.)
• Environmental stewardship • Health and safety on the farm
• Energy innovations
• Education and marketing of agriculture to society.

Four broad criteria will be used to identify the winning innovations; uniqueness and originality, stage of development, the impact or benefits of the
innovation, and adoption and/or commercialization. Applications must be submitted by November 30, 2006.

The Ministry of Agriculture, Food and Rural Affairs is now accepting applications for the program. As many as 55 regional awards, valued at $5,000 each, will be presented. The recipients of the Premier’s Award (up to $100,000) and the Minister’s Award (up to $50,000) will be selected from the regional winners.

For more information call 519-837-6397 or visit the website, http://www.omafra.gov.on.ca /english/premier_award/index.html.

Minister Strahl Visits China

The Honourable Chuck Strahl, Minister of Agriculture and Agri-Food traveled to China from October 6 to 13 to strengthen the overall bilateral relationship between Canada and China, with an emphasis on agriculture.

Minister Strahl met with provincial officials in Shaanxi Province to discuss science and education collaboration and rural farm issues. Other meetings
focused on increasing the existing co-operation in areas of mutual benefit and interest, including regulatory co-operation, agriculture development
projects, co-operation in science and technology research, innovation in biotechnology, two-way investment and rural development.

Farmland Values

Changes in Ontario land values moderated somewhat from the previous pace of increase. Values increased by 2.1 per cent across the province which is less than the 3.8 per cent recorded for the last half of 2005.

Land prices strengthened in areas beyond the provincial greenbelt as speculative bidding pushed up prices, particularly in the Niagara Region, Haldimand County, Simcoe County and immediately east of the Greater Toronto Area in Durham Region and Victoria County.

Traditional cash crop sectors saw little or no change in land values with several exceptions. Vegetable land continues to be in demand for field
tomato production and, conversely, heavier and marginal soils showed a drop in price due to continued low grain and oilseed prices. These are the
first noted decreases in some time.

The average value of Canadian farmland increased 2.1 per cent during the first six months of 2006. This is higher than the 1.5 per cent increase in
the last six months of 2005.

Many provinces continue to see growth in farmland values. Increases are on par with an upward trend since January 2000.


Greenfield Ethanol Announces Program for Ontario Corn Producers

GreenField Ethanol Inc. (formerly Commercial Alcohols) launched a new exclusive program that will benefit Ontario corn growers.

The Ontario Buy Direct Program means that Ontario corn growers can sell their corn directly to the buyer – GreenField Ethanol Inc. The program offers a variety of sales contracts which improves the grain marketing options, such as “Futures First,” a contract that allows producers to
lock into futures prices today and set the basis prior to delivery. The other types of contracts offered are Average Price Contracts, Minimum Price Contacts and Offer Contracts.

For more information, visit the website www.greenfieldethanol.com or call (519) 471-3661.

Government Provides Funding for New Biofuels Opportunities to Producers Across Canada

The federal government has committed $10 million to help farmers and rural communities across Canada increase their participation in biofuels production in Canada.

The Biofuels Opportunities for Producers Initiative (BOPI) helps participants hire experts to help develop business proposals and undertake feasibility studies to expand biofuels production capacity that involves significant (greater than one-third) ownership by farmers.

The BOPI will help provide new opportunities to farmers, and will also help lay the foundation to meet Canada’s biofuels commitment of 5% average
renewable fuel content in transport fuel by 2010. Greater involvement in biofuels production facilities will allow agricultural producers to become participants in the value chain and increase their share of the benefits from renewable fuels production beyond delivering feedstock.

For more information, visit the website of the Agricultural Adaptation Council, http://www.adaptcouncil.org/current_programs/biofuels.asp.

USDA Issues Final 2006 Direct Payments and Final 2005-Crop Corn Counter-Cyclical Payments

Deputy Agriculture Secretary Chuck Conner announced on October 12 that USDA's Commodity Credit Corporation (CCC) has begun issuing US$3 billion in final 2006 direct payments to producers with base acres enrolled in the Direct and Counter-cyclical Program (DCP) and US$1.6 billion in final 2005-crop corn counter-cyclical payments (CCP) to producers on farms with corn crop acreage bases enrolled in the program.

The final 2005-crop corn CCP rate is US$0.35 cents per bushel. The 2002 Farm Bill authorizes partial CCP allotments in October and February, with final payment made at the end of the marketing year. Producers with corn base who accepted partial payments in October 2005 and February 2006 received US$0.28 per bushel. They are due an additional US$0.07 per bushel. The final marketing year price for 2005-crop corn is US$2.00 per bushel.

Since the effective price for soybeans exceeds its target price, CCC will not issue any 2005-crop soybean CCPs. The final marketing year price for
2005-crop soybeans is US$5.66 per bushel.

McGuinty Government Helps Farmers Connect With Consumers

On October 2nd, the McGuinty government announced that $50,000 will be provided to AGCare (Agricultural Groups Concerned About Agriculture and the Environment). The funding will enable AGCare to promote agricultural use of modern technology and the benefits these offer to consumers.

AGCare provides science and research-based information on pesticide use, crop biotechnology developments, nutrient management and other related environmental issues to consumers and the media.


Syngenta's Corn Rootworm Biotech Trait Approved in the USA

Early in October, Syngenta announced that its corn rootworm trait named Agrisure RW had received the necessary registration approvals from the US Environmental Protection Agency (EPA). Syngenta intends to make hybrids containing the trait available for the 2007 United States market.

Agrisure RW will be available to US growers as a single trait as well as a stack with glyphosate tolerance. U.S registration is pending for the Agrisure RW trait stacked with corn borer that would enable the commercialization of the triple stack of glyphosate tolerance, corn borer and
rootworm resistance.

Environmental Stewardship on Farms Supported by McGuinty Government

The Ontario Soil and Crop Improvement Association received support from the McGuinty government in the amount of $426,000 over three years. The Association partners with many agencies to deliver education programs, conferences, farm and field demonstration tours and environmental improvement programs. The investment will lead to new research and tools for farmers.


Greenbelt Farm Stewardship Program

A partnership with the Friends of the Greenbelt Foundation, farm organizations and federal provincial governments has been formed to offer a program that will cover up to 75% combined cost share to farmers planning to implement eligible beneficial management practices.

The Foundation is supporting the program with a $1.4 million grant. The program is delivered in collaboration with programs available through the Canada-Ontario Environmental Farm Plan.

For more information, contact the Ontario Soil and Crop Improvement Association or visit their website at www.ontariosoilcrop.org.

CFIA Launches Public Consulation on Proposed Seed Regulatory Framework

The Canadian Food Inspection Agency (CFIA) has recently launched a 60 day public consultation on its proposal to facilitate the modernization of the Seed Regulatory Framework.

The purpose of the proposal is two-fold; to receive public feedback in order to gauge the level of support for proposed changes, and to identify priority areas for discussion with regard to Canada’s seed program. The public consultation includes both a web-based workbook www.inspection.gc.ca) and key stakeholder meetings.

This proposal has been developed over a three year period and is intended to strengthen and increase the flexibility within the current seed variety
registration system. It is also intended to facilitate ongoing discussion, analysis and consensus building activities to address a range of other important seed regulatory issues. It is CFIA’s hope that the information gathered through the public consultations will help finalize its proposal and
introduce any required regulatory amendments.

Gene Switch Makes Crops Drought Resistant When Needed

At a recent symposium held in St. Paul Minnesota, David Dennis presented the concept of a unique type of transgenic crop that could benefit food growers worldwide by turning on a gene that would resist drought. The president and chief executive of Performance Plants, a Canadian plant
biotechnology firm based in Kingston, Ontario, continued by clarifying that the gene will only turn on when the plant begins to dry out. It is not too
difficult to make plants drought resistant; the problem lies in the fact that drought resistant plants won’t yield when grown under good conditions with plenty of water. Producers would definitely avoid use of such biotechnology because they generally believe they receive plenty of good weather. Under the gene technology that Dennis’s company has developed, the system only switches on during periods of drought. If conditions
are normal and the plant has access to water, the system is switched off as if the gene were not even there.

Russ Sanders of Pioneer High-Bred International, based in Des Moines, Iowa, said that his company believes biotech crops could help ease the annual worldwide drought loss of roughly eight billion dollars. In the United States, 52 to 61 percent of farmers use biotech corn and 87 to 89 percent use biotech soybeans.

Croplife Canada Releases Its 2005 Industry Sale Survey

CropLife Canada released its 2005 Industry Sales Survey at its 54th Annual Conference.

Pest control products sales were $1,338,272 in 2005, down 3% over 2004. The decrease was mainly in the Herbicide sector in the Cereal and Oilseed crops. Herbicides continue to dominate pesticide sales in Canada in 2005 and accounted for 78% of all pesticide sales.

Sales of herbicides and insecticides decreased by 2% and 35% respectively over 2004 while sales of Fungicides increase by 2% over 2004.

Sales of pesticides by active ingredient decreased by 5% over 2004.


Canadian Biotechnology Advosiry Committee - Biotechnology in Relation to Sustainable Development

The Canadian Biotechnology Advisory Committee has released a study, BioPromise? Biotechnology, Sustainable Development and Canada’s Future Economy, prepared by the BSDE Expert Working Committee, which is the first comprehensive effort of examining biotechnology in relation to sustainable development. The report is directed towards decision-makers within the federal government with nine key findings and recommendations.

Recognized in the report are issues such as a backlog of environmental problems, the need to improve the eco-efficiency of industries, a critical economic situation in rural areas and achieving longer-term societal goals. The report highlights opportunities and steps that need to be taken if Canada decides to embrace biotechnology as a means of addressing sustainable development issues.

Farm Safety Education

The McGuinty government is investing in programs to promote farm safety. A total of $360,000 over three years is being provided to the Farm Safety Association. The first installment of $60,000 was presented to the Association in September.

[Back to top]