Larry Martin, Holly Mayer, and Charles Mayer
April 6, 2001
Lawrence Solomon should buy 25 acres and become a vegetable tycoon. When he does, he may learn a few things.
Small farms that grow a wide range of vegetables require a large amount of labour. This makes them high-cost producers. In general, the market won’t pay enough for the vegetables to provide an adequate living for producing them on small farms, unless Canadians would like to give up the option of buying fruits and vegetables from places that can produce them year-round. What right does Mr. Solomon have to condemn people to doing work that ensures they will be poor?
On the other hand, 200 acres of processing tomatoes — if one can get the contract — produced with modern technology, makes a very nice living for the farmer and a relatively small amount of hired labour. (This and the last point together are what is known as “economies of size.”)
There is no such thing as monoculture, because modern farming requires crop rotations that maintain productive soil and prevent disease. To brand the production of tomatoes for processing, which takes place in one of the most diverse agricultural areas in the world, as monoculture is just ignorant. All tomato growers produce a wide range of other products. (Interestingly, many farmers in Western Canada would prefer not to produce wheat and barley because they have to market them through the Canadian Wheat Board. But they can’t avoid it because crop rotations don’t give them a choice. What monoculture?)
Mr. Solomon might observe from his tomato-growing competitors that they do buy crop insurance in Ontario — even though there is less production risk than in California, the major processing tomato-growing area of the world. While crop insurance is subsidized, the farmer’s share for tomatoes is about 1% of gross revenue. Even if it wasn’t subsidized, it’s not likely to affect production decisions.
If farmers don’t use crop insurance, even though it’s subsidized, and they move to larger operations, it is evidence of exactly the opposite of what Mr Solomon claims. In an economy that offers people quite nice non-agricultural incomes, small-scale, labour-intensive commodity production is a romantic dream of people who are not involved in agriculture. Many farmers are sick and tired of the Lawrence Solomons of the world wanting them to be poor, while the dreamer sits in his urban office.
Those farmers who do purchase crop insurance are most certainly not “bet[ting] the farm on each and every harvest.” Farming may be a more uncertain way to earn a living than many occupations, but the notion that subsidized crop insurance makes it essentially a form of high stakes gambling is ridiculous and insulting to the production expertise of Canada’s producers. Earning a “fist full of dollars” is contingent upon a lot more than the weather co-operating.
Lastly, there are very, very few corporate farms (in the sense that Mr. Solomon means) in Canada. The vast majority of farms are family owned and operated, even when they are organized as corporations — a structure that offers many sensible tax and estate planning advantages under Canadian law. Many are most certainly large-scale farms compared to farms of past generations, but this is because of the advantages of scale that make practical business sense, unless the farmers want to be poor peasants.
For this reason, Mr. Solomon’s concluding statement that large-scale farms would contract if subsidies were removed is patently wrong. Such a move would reinforce the need to lower cost through scale as an offset to the higher cost of risk.
Between Mr. Solomon’s assertion that we need more (poor) farmers one day (How Subsidies Ploughed the Family Farm Under, March 22), and University of Guelph professor George Brinkman’s equally absurd assertion that we have too many farmers for market conditions (The Case for Eliminating All Farm Subsidies, March 20), the Post’s Farm Week series certainly did oodles to help people understand the reality of modern agriculture.
Larry Martin is CEO and Holly Mayer is Research Associate at George Morris Centre in Guelph. Hon. Charles Mayer is Former Federal Minister of Agriculture.