2023-04-19 10:30:00
A survey by the Union des producteurs agricole (UPA) suggested last week that agriculture in Quebec is not doing well and deserves additional help from the state. A bad time for complainers as food inflation and high interest rates affect everyone.
Have you ever heard a farmer tell you that business is good? That the money is flowing? According to some groups, agriculture is still on the verge of disaster. Sometimes we hear the unfortunate story of certain producers who will lose their shirts due to circumstances beyond their control, such as the unstable climate, skyrocketing input prices, the scarcity of labour, in short, the list is constantly growing. The UPA never misses an opportunity to remind Quebecers that farmers have it tough.
Last week, the UPA presented the results of an internal survey. More than 3,000 companies were part of the sample, but the methodology used and the questions posed to farmers were not disclosed. The reports provided by the UPA are always a little vague. Finally, according to what Daphne Cameron learned from The Press11% of Quebec farm owners are considering “closing up in the next 12 months in order to meet their financial obligations”.
It’s hard to know what that really means. Is it because they are fed up, or because they fear an inevitable bankruptcy? Not clear.
We also learned that 41% of companies surveyed indicated that rising interest rates could prevent them from meeting their financial obligations and 18% fear renegotiating the terms of their debt with their bank. The results inevitably set the table for a union grocery list. Very difficult to take all this seriously when the same scheme is repeated every two years, or almost.
Of course, a career in agriculture is not easy. But in the other provinces, few groups will parade with the media to proclaim that they are going through difficult times and need help. Only the UPA published such a survey to seek the sympathy of a public already tested by food prices in constant escalation. A rather bad moment.
Everyone is having a hard time these days, not just the farmers. Companies must also borrow capital at a higher rate.
In fact, the Canadian Federation of Independent Business conducted a similar survey recently. According to his study, 10% of small business owners would go bankrupt within a year and 46% of businesses threatened with closure would simply go out of business rather than go through the bankruptcy process. Interest rates and costs in general affect the whole economy. Federation data includes data from several food processors, retailers, restaurants and other agribusinesses.
The same financial heaviness exists for consumers.
Households with a $300,000 variable-rate mortgage, amortized over 25 years, will see their payments increase by about $600 per month. Additionally, food inflation will force that same household to pay $1,065 more for food this year. It’s not easy to win public sympathy when everyone is struggling to make ends meet!
In short, it is high time for the UPA to promote things that are going well for the agricultural sector. For example, according to Statistics Canada, farm receipts in Quebec increased by about 14% in 2022 and revenues are expected to increase further in 2023, according to Agriculture Canada. Things are no less good in Quebec than elsewhere. In Quebec, the majority of agriculture is covered by income support programs that capture rising production costs, and the last provincial budget increased support programs by more than $800 million over five years.
With such pessimistic and alarming messages, the UPA is not helping its cause. It’s hard to encourage the next generation to join the ranks of agriculture when the UPA constantly hammers the message that farmers always find themselves on the edge of the abyss. Despite this, the number of farms in Quebec has increased since 2016, according to the Quebec Ministry of Agriculture, Fisheries and Food. So, if things are so bad, why is local agriculture attracting so many new dynamic leaders in the sector?
The chronic chialage of the “UPAien” established order is so constant that Quebecers end up not listening any more. A change of tone from the union would help.
The UPA survey was published a few days before Olymel’s announcement about the closure of the Vallée-Jonction plant. Very bad news for the Beauce region, and it’s not over. There could be another shutdown, much like Maple Leaf’s sporadic shutdowns over time. Quebec will have fewer hog farms in a few years. No need for a survey to realize that the Quebec pork industry is going through a crisis. It is not just a cycle that the sector is going through, but rather a change in direction that becomes necessary. Olymel must survive and the entire industry will have to recalibrate to respond to a changing global market.
Resilience in agriculture has no equal. Let’s celebrate our agriculture as it should. Instead of saying that everything is bad, the UPA should focus on real crises. And Olymel is one.
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