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Feb 21 2011

Old Agriculture is Dying

I’m typing this on my recently new Aspire One netbook. It’s booted to Ubuntu 10.10 because I dislike the way Windows operates. Between my husband and I we have 4 computers, we used to have 5. I’m also watching him play Little Big Planet 2 on our PS3 and 40″ Sony LCD which I helped choose. Video games are one of our favourite past times. My iPhone 3Gs buzzes in my pocket and it’s a text from a friend in MN. It buzzes again and it’s a twitter mention from another friend in FL. The wonderful little gadget is practically surgically attached to me. I’m young enough that by the time I started doing projects in elementary school that required any research at all computers were necessary. Tech is my life, I am a geek and I love this modern world I live in.

There’s a point to this, it’s meant as a contrast. I also work at a local vineyard/winery which is really just a fancy way to say I do farm labour for a living; I farm grapes. I’m also damn good at what I do. I work hard, I use complicated heavy machinery and I help to produce good crops.

I recently read this 56 page 2010 report on the state of agriculture in Atlantic Canada. Twice. It’s sad, and scary, and heartbreaking for all the reasons it ought to be as local farms are disappearing. It’s also frustrating however in a unique way for people like me. I’m a 25 year old woman who enjoys video games and travel, who is interested in the world’s politics and cultures, who eats sushi and cares about scientific progress. I also care about farming.

I hate to say it but this report frames it all wrong. It wants consumers to care about farming, and about the state in which farmers are currently living. It wants people to know where their food comes from and to buy local. It wants young people like me to give a damn. Why then did it feel like they were sneering at me the whole time? Read it if you can as I get the feeling that it’s not just Atlantic Canada who is having problems in the agricultural sector, but I’m going to try to go through it here and address a few concerns I have. Grab a seat and a drink. (Do you know where it came from?)

Ok, let’s start with as best a summary as I can come up with for this mountain of information.

The essence of the problem is that farmers simply aren’t getting the prices they need to cover the rising costs of growing food. Input costs are high, while output prices are low.

This is not to say that food prices are not high, they are. A trip to the grocery store is getting more and more expensive all the time. The extra money that I’m paying out however just isn’t making it to the farmers for some reason.

In 2002, Nova Scotia farmers got 14% more for their products than in 1986, but paid 42% more to produce them. Meanwhile consumers paid 46% more for food.

The report then goes into some detail about the financial situation by analysing five ‘financial measures’: net farm income, expense to income, total debt to net farm income, solvency, and return on investment. A summary of the results is as follows:

Financial measure #1: net farm income

While total farm cash receipts (revenues) have risen in the past 35 years, net farm income has plummeted. In Nova Scotia, for example, farm revenue went up by 11% but net income crashed downward about 79%. … Between 2001 and 2008, the average farm in Nova Scotia made a net income of $5,805 per annum.

Financial measure #2: expense to income ratio

A healthy farming sector should have an expense to income ratio of less than 80%. … All four Atlantic Canadian provinces have suffered large increases in this ratio since 1972. … Every Atlantic province is now well over the safe 80% mark. Nova Scotia and PEI are over 100% …

Things get a little hairy for “Financial measure #3: total debt to net farm income ratio” because they don’t actually release the numbers, and the graph is a bit hard to interpret. What they do say is this:

If the ratio of total debt to net farm income is 600:1 (meaning $600 of debt for every dollar of net income) or less, it’s a sign of a healthy farm sector. … In Nova Scotia, the debt to net income ratio more than doubled in the 1990s, then doubled again in the early 21st century.

Not very specific.

They are even less specific about “Financial measure #4: solvency ratio” which is apparently farm debt divided by farm assets. From the graph, it looks like in Nova Scotia between 2005 and 2010 the ratio went up to 0.35 but there is no explanation of what this means, other than ‘bad’. Overall the report states this means that the farms are less sustainable but I wish they addressed the numbers more.

Finally, for #5 all they really have to say is this:

Financial measure #5: return on investment

In the late 1990s, for instance, trusted pension funds got an average return on investment of 10.2% and the ROI of the food retailing and processing sectors was just over 12%. Only one kind of farm did that well in Atlantic Canada, and that was dairy farming, which earned an average annual ROI of 12.2%. By comparison, tree fruit and hog farmers in Atlantic Canada consistently earned negative returns on investment.

As you can probably tell I’m not all that impressed with how the numbers were handled here. There is also only one link at the bottom for sources

For sources, references, and methodology,
see the agriculture reports at
www.gpiatlantic.org

You have to dig around the site to find what you’re looking for and I haven’t spent enough time to find exactly what I need. There wasn’t any reference to the names of any of the studies in the report at all. It’s not that I think the report is lying, or that the crisis isn’t real, I just don’t like the idea of not being able to easily verify where these numbers came from.

The crisis is real, I’ve seen the hog farms shut down and the apple orchards fall into disrepair. The wine industry in Nova Scotia is growing, but still I’m told that it is hard to make a profit. I imagine that wine makers and grape growers are doing better than the vegetable farmers though. People like to drink.

My concern is that this report spends a lot of time and effort on blaming the supermarkets, blaming free trade and imports, and blaming young people and ‘city folk’ for not caring where their food comes from. Likewise it engages in what I would consider fearmongering by continuously suggesting that farmers have the most important role in happy communities, and without them all will surely collapse into depression and crime. Farmers are important, food is important, but fearmongering like this doesn’t work and their premise isn’t even all that accurate.

Here is the kind of thing I’m talking about:

But here’s the strange thing. In a pinch, Jim believes he could survive for quite a long time without the services of teachers or lawyers or bankers. But if they and their families had no food for a couple of weeks, they’d be clawing and kicking and stealing from each other to get it. They’d be rioting in the streets.

So whole communities are fading. And, as Jim Grant notes, farmers don’t just shuffle paper around. They generate real wealth, producing essential goods from our natural resources.

I feel the whole thing comes off as a bit petty. I understand that farmers are angry though, so I imagine this colored the report somewhat. I should also point out that the above quote is a made up narrative at the beginning of the report, Jim Grant isn’t a real person. I think the narrative was entirely unnecessary to the purpose of the report. Plus on top of that, farmers and teachers and lawyers and bankers should all be working together. Three out of four of those professions have found their own way to exist in modern society, it’s time farming did too. I want to help, and I think there are a lot of young people out there like me who would be willing to give it a shot if it weren’t so colored to look like we can’t have our modern luxuries the way we like them if we want farming to survive. Farming and modern society don’t need to be enemies. We just need a new system because the old one is pretty broken.

In the second half of the report, some solutions and ideas are raised, and I think some of them have a lot of promise. I’m going to save that for a second blog post though, this one is getting long.

7 comments

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  1. 1
    Ben Zvan

    Buying local is only part of the trick. Obviously, you can’t get most fruits and vegetables locally this far north, so you have to concentrate on getting the things you can. Many of the markets in my area are starting to label origins on food, so that helps me buy many things locally, but all the bananas come from thousands of miles away. It would be interesting to find out where the extra money you’re spending on food goes if not to farmers.

  2. 2
    Jason Thibeault

    Fresh produce all year around would fall under the category of ‘modern society luxury’. Though really, I think the improvement to health makes it necessary. I like having fresh fruits and veggies all year, even if they do come from Mexico. I really don’t see anything wrong with buying healthy food from other countries if you can’t get it here.

    The report suggested that the money is going to the supermarkets. The idea seemed to be that they are asking the farmers to sell cheap and the consumers to buy high simultaneously.

  3. 3
    Ben Zvan

    There’s definitely a loss in the supply chain. How is the farmers’ market scene up there?

  4. 4
    Jason Thibeault

    Pretty good in the summer. There are at least 9 in our immediate (three town) area, as well as weekly markets that set up in public spaces for a day.

  5. 5
    A

    Great post, Jodi! Blaming supermarkets does seem like an oversimplification of the pressures farmers face. When I get a chance, I’m going to read the report. Thanks for bringing it to our attention.

    Ben Zvan:
    There’s definitely a loss in the supply chain. How is the farmers’ market scene up there?

    To clarify Jodi’s mention of the local Saturday market, I’m pretty sure it’s open year-round. They go indoors for the winter.

    In the metro area there are are 3-4 large farmers’ markets. One has a new location and is experimenting with opening more days a week, though Saturday is still the most popular day. I haven’t read the study yet, but urban Nova Scotians definitely support farmers through those markets.

  6. 6
    A

    p.s. I don’t want to spam the blog, so delete this if you want.

    We just lost the local battle to keep some significant farmland zoned as agricultural (it’s being switched to residential/commercial), but the fight’s going provincial. There’s a rally on Saturday (the 26th) at 11am at the Halifax Farmers’ Market: http://halifaxfarmersmarket.com/

  7. 7
    Jason Thibeault

    Thanks A!

    I’ll consider writing to the appropriate people about the land rezoning, I hadn’t realized it happened already.

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