Despite yo-yoing global markets, wild swings in weather, and now seven billion mouths to feed, some say these is the best of times for agriculture. But as soon as the words leave their lips, they’re quickly add it’s the worst of times, too.
Take the latest example, a special and extremely digestible report on farming’s new age, released last week and authored by TD economists Derek Burleton and Dina Cover. They write that Canadian farming has been enjoying a revival for the past five years, with a booming emerging market growth, strong overall global food demand and relatively high commodity prices.
In the same report, though, the authors say it’s also the worst of times of farmers. They say the main culprit is “unprecedented volatility” and the unpredictability that comes with it.
Here’s why. Farmers get some tax breaks, but like the rest of us, they are constantly paying more for fuel, hydro and other expenses. You know what’s happened to your bills, even in the face of a global recession. Imagine trying to raise livestock or grow crops in that environment. You’re making more money, but you’re spending it faster, too.
And, like the rest of us, farmers are pawns when it comes to wild swings in global markets and the uncertainty that comes with it. Even though, as the report points out, half the global economy is experiencing growth, the parts that aren’t make headlines. That scares investors and drags down everyone and everything, including generally high commodity prices and gains that might otherwise be made selling commodities to investors.
I write more about this report in my Urban Cowboy column in the Guelph Mercury. The photo is from the farmissues.com photo library.
