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As the GATT unravels into the World Trade Organization, and on into a global trading context where export is king, old fixations will still hold sway: produce, produce, produce.
The objective of Agriculture and Agri-Food Canada to increase agricultural exports by 50%, to $20 billion annually by the year 2000, is a typical example. Up the volume, increase the cash flow and hope that the bottom line is far enough up the scale to avoid income support payments. Indeed, Canada always has been, and always will be, an economy dependent on exporting its produce in order to make a living. While Canada has always produced large volumes of commodities and shipped them across the nearest border and overseas, the time has come to be less concerned with quantity and put more emphasis on quality.
From a production point of view, Canada resides next to the world's largest food producer. The U.S. can supply out of its surplus all the domestic food requirements for Canada, and then some, in every agricultural commodity except maple syrup. Trying to out-produce America is like David taking on Goliath without a sling-shot. From an economic angle, simply producing more resolves nothing in terms of income returns for farmers. The more food that is produced, the lower prices go, the slimmer margins get and the more farmers are forced to adopt technology and agricultural practices that are not sustainable in the long-term. From an environmental aspect, it is a recipe for continued exploitation of natural resources.
Like David, Canada needs to develop a strategy that neutralizes the Goliath next door, and Canada's greatest strength and the U.S.' most evident weakness is quality. This does not simply refer to a little value-added here, and a little fancy packaging with a premium price there; quality should relate to the way in which the food is produced as well. Canada's marketing advantage will be in differentiating its produce from that of competitors, and the quality of the methods of production and the environment that supports that production will be the mark of Canadian food exports. rBST is a good example. American dairy producers have adopted the technology with open arms, as another way to produce more, which is the American way to earn more. If Canada were to choose not to approve the use of rBST, a publicity campaign accompanying dairy exports could promote the fact that rBST was not used in the product. If all milk produced in Canada were to be rBST free, it would dispense with the need - and the cost - associated with separate processing and labeling.
There is no limit to the number of ways in which Canadian agricultural produce can be given a "green" spin. Cheese from dairy cows that utilize non-irrigated forages might be a big sell in California. Pasture-raised beef - from calving to finishing - might have appeal to those who want the food that they consume to be ecologically respectful. Vegetables grown in rotation to reduce soil erosion and reduce chemical inputs have green stamped all over them. Apples government-inspected and certified to be pesticide free, milk guaranteed to be clean of any residues, antibiotic or otherwise. Quality is not only appealing to consumers, but good for processors as well. There is a direct correlation between the somatic cell counts in milk and the quantity and quality of cheese that can be manufactured; the higher the milk quality, the lower the SCC, the better and cheaper the cheese.
Which brings up the question of quality assurance. Whether organic or not, standards must be set and adhered to, and promotion has to be organized to make buyers and consumers aware of the reasons why Canadian products are different . . . and better. This will require collaboration between producer organizations, processors and government. It will no longer be good enough to say "That's their responsibility". Marketing boards will have to do more than just assemble the produce in one location for sale to buyers; they will have to set and enforce standards, run education campaigns and help initiate and implement programs that give their products a marketing edge. Processors are going to have to pay a premium for the goods they want; for too long it has been price maximums with discounts for less. Government is going to have to provide the muscle for legislation, inspection and promotion; this is not the time to be backing away from providing services that could help both economically and environmentally. Quality will count for the Canadian agri-food sector, and will be counting on the collaboration of all particpants, not just on the efforts of farmers alone.
Copyright © 1994 REAP Canada
Reprinted with permission. All rights reserved.
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