The tone of a new advertising campaign created by Grain Farmers of Ontario has created division in the agriculture sector during the COVID-19 crisis.
“You’ve already seen the empty shelves. The food supply chain is breaking,” says the advertisement, which comes from Grain Farmers of Ontario (GFO).
A worried-sounding narrator talks about food shortages over visuals of ramshackle barns.
Frustration boiling over
“The whole point is we’ve been seen as the nice guys all the time,” says Markus Haerle, chair of the board of the GFO. “Realistically today we have to stop being that nice farmer in the countryside who waves to everyone. We can’t afford to do that.”
“We at GFO always have been up front about pushing harder than other commodity groups in Ontario and Canada. We’re hoping at a certain point other commodity groups will tag onto this campaign. We’re spending millions of dollars on this and this is step one.”
Why it matters: Farm organizations have taken careful steps to maintain good relations with government, but the GFO campaign could change that.
However, farmer organizations have worked for years to encourage consumers to listen to science versus fear-based marketing campaigns related to pesticides and genetically modified crops, whereas the new GFO campaign is related to people’s fear of not having enough food.
“Agriculture as (an) industry has long bemoaned the marketing of fear in products like GMOs,” says Mike Von Massow, an associate professor in Food, Agriculture and Resource Economics at the University of Guelph.
“We in agriculture have long argued marketing of fear is not a good approach and to me this feels like ‘oh unless we get support, there is not going to be food on your tables.’”
Von Massow says it’s clear there are issues in production agriculture and “farmers are struggling in a variety of sectors for a variety of reasons. It’s not a surprise that farmers are asking for additional support.”
The advertisement has elicited significant debate on Twitter and Facebook, with some farmers saying it’s time to stand up to government, and others concerned that the sector is putting itself ahead of front-line health care workers.
Von Massow says the other major concern is that many of the grain farmers’ issues don’t have to do with COVID-19 and are long-standing concerns with farm safety nets.
Indeed, grain farmers haven’t had a policy win in a long time, and in fact government supports and costs have slid backwards, including the fact that grain farmers bear significant carbon tax payments on grain drying and that AgriStabiilty reference margins have declined, making it harder to qualify for the program.
“If you hang your hat on this (as) a COVID-created crisis, it makes it more difficult to have long-term discussion on supports agriculture needs,” says Von Massow.
Some farmers have criticized the government for supporting other areas of society instead of agriculture. A favourite comparison on social media is the $9 billion for students who will find it difficult to work this summer, and includes funds for foreign students.
“To me that comparison becomes dangerous because what if agriculture asks in a couple of years for money for something else? Can students then stand up and say agriculture is getting all this money, why aren’t we getting money?”
The Canadian government recently announced a $252 million program to help farmers, but most of that money is aimed at the livestock sector, where processing plant closures have meant animals back up onto farms, where farmers either have to find other markets, keep feeding them, or euthanize them.
Haerle said lower prices mean some farmers are going to have to change their cropping plan, including growing other crops and using less fertilizer or sprays.
How did we get here?
The past couple of years have been tough for grain farmers, mostly fueled by oversupply of corn and soybeans in the world and policies of the Trump government in the U.S.
Canadian grains prices are set by U.S. markets, so anything that drives down American price, such as the U.S.-China trade war, also affects Canadian producers.
The Trump government has also tried to erode ethanol production, meaning a pull-back in ethanol.
A steep drop in oil price in March due to an OPEC spat drove down ethanol profits.
Haerle says ethanol plant contracts with farmers are being broken, so they have to find new markets for their corn, or continue to store it.
Corn and soybean prices have declined since the COVID-19 pandemic started and at the current price of corn, farmers in Ontario will lose about $130 per acre, says Haerle. “We’re talking about $4 corn. That’s way below cost of production.”
A recent GFO survey of its members found
- 86 per cent expect net income to be reduced;
- Over half of grain farmers are already seeing a reduction in sales and another 24 per cent see issues with existing contracts;
- One third are experiencing cash flow challenges and another third expect cash flow issues in the near future;
- 55 per cent fear that they won’t cover the cost of production;
- 77 per cent of grain farmers want to see equivalent government funding to the U.S.