Value-added progress would help ag sector

By Lethbridge Herald on October 30, 2013.

The agricultural industry in Alberta has had its ups and downs in the last decade.
   It is impossible to paint the entire sector with one brush, as prices in various commodities fluctuate wildly from year to year, and Mother Nature often plays a very large role in the level of success producers experience each season.
But if a general observation can be made, it surrounds the lack of progress in terms of the development of value-added industry here in Alberta in the agricultural sector. It has long been a key component of the provincial government’s strategy in terms of boosting the fortunes of those who live on the land. Friday at the University of Lethbridge, the slow development of value-added industry in Alberta, and across the country for that matter, was highlighted by professor Danny LeRoy, in terms of the impacts on the beef sector.
The fact is, as he pointed out in a presentation, there has not been a marked increase in slaughtering capacity in Canada since 2003’s BSE crisis gripped the country. Instead, the numbers point to a slight decrease in that capacity, as our reliance on plants in the United States continues to be a problem for producers north of the border.
America’s Country of Origin Labelling and groups south of the border such as R-CALF USA have pushed protectionist policies to the forefront, and have given Canadian producers even more cause for sleepless nights. Simply put, a shrinking industry could be shrinking even further without a push to develop the industry within our own borders.
That case can be made for various other agricultural commodities, as the discontinuation of the Canadian Wheat Board’s single-desk system was also designed to boost locally grown, value-added business ventures, with the hope more producers would develop the entrepreneurial spirit.
Our agricultural economy is certainly heavily dependent on exports, but as the BSE issue did teach Canadian producers, the domestic product is also very strong for home-grown items of the highest quality. As markets closed for our beef, Canadians supported the industry by consuming more beef post-BSE than they did pre-BSE.
That said, export markets will continue to be the Canadian agricultural industry’s lifeblood. And while market-access issues still exist for many commodities, the Canada-Europe Trade Action Plan (CETA) will certainly help in that regard. In Alberta, the agricultural sector is already the second-largest source of exports to the European Union, as the annual average exports amounted to $282.5 million a year between 2010-2012, even at an average tariff rate of 13.9 per cent.
With a vast amount of that trade now duty free, and specified amounts of Canadian beef, pork and bison now set to head overseas, part of the agricultural equation is taking shape. Alberta, and the rest of Canada, now has to get a better handle on the value-added chain, and help the industry evolve even further.
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