Farm organizations have warned tax makes Canadian producers uncompetitive.
OTTAWA — Despite wide-spread farm group criticisms of the federal carbon tax, Agriculture Minister Lawrence MacAulay has told both senators and MPs that farmers back it.
“Farmers fully support it,” MacAulay told the Senate. “I can assure you the farmers are fully on our side and have always helped in this area.” The minister’s answer blended agriculture’s concern about the impact of climate change with support for the carbon tax.
In a rambling exchange with Conservative farm critic John Barlow at a Commons agriculture committee meeting, MacAulay suggested the support of agriculture groups for transportation legislation that will help ensure Prairie grain movement was a sign that farm groups support the carbon tax.
Grain Growers of Canada said its members “do not support a price on carbon that will negatively affect the competitiveness of Canada’s grain farmers. Grain farmers are opposed to additional costs which cannot be passed on, must be absorbed into the cost of production and do not take into account the role of the industry in carbon mitigation.
“Farmers are international price-takers and cannot pass on increased costs to their buyers,” GGC said. “They effectively pay retail prices for inputs, and sell their product at wholesale while paying the freight both ways which is subject to the carbon price.”
GGC is concerned with the tax’s impact on the competitiveness of the export sector, credit for carbon sequestration by farmers, on-farm fuel use including propane and natural gas for conventional grain drying as perishable biological organisms need to be conditioned as to not spoil and higher input and transportation costs.
A similar message comes from Ron Bonnett, President of the Canadian Federation of Agriculture, who wants all on-farm fuels in Canada exempt from carbon pricing. Otherwise Canadian farmers are at a competitive disadvantage to farmers in other countries, especially the United States.
The CFA’s 2018 policy statement says “Governments must take action to ensure that carbon pricing policy is truly revenue neutral for agricultural producers.”
The carbon tax will discourage agricultural investment “at a time when it needs to be ramped up as a strategic growth sector and to reduce emissions intensity.
This also holds true for available funds to invest in clean technology that would reduce emissions. If agricultural production expands in countries other than Canada to meet the growing demand, it is very likely that global emissions will increase relative to a comparable expansion in Canada.”
Jim Wickett, Chairman of Western Canadian Wheat Growers, said the minister’s statement that most farmers support the carbon tax “is simply not correct. I’m not sure who has been briefing Minister MacAulay, but he is dead wrong if he thinks that most farmers support a carbon tax.”
A WCWGA statement also says,
“Farmers don’t agree on everything, but if there’s one issue they stand together on, it’s in opposition to a carbon tax.”
The WCWGA and the Association of Saskatchewan Agriculture Producers (ASAP) are backing the province’s attack on the federal carbon tax.
“Our members strongly believe that carbon taxes do not work for agriculture,” said ASAP President Todd Lewis. “Producers are not able to pass along increased costs of production to our customers. We use every possible technology to reduce our energy costs, and the federal government has not been very clear on their understanding of this basic agricultural economic reality.”
Markus Haerle, Chairman of Grain Farmers of Ontario, says, “Ontario grain farmers do not support a tax on carbon. The minister might not be aware that conservative estimates for grain farmers alone suggest an increased cost for farm fuel of $26 million per year and we expect that figure to increase.
“It’s impossible to predict the total cost of the tax, and he acknowledges farmers are caretakers of the land and already embrace new methods and practices to protect the land at great personal cost,” Haerle said. “This additional tax with no reprieve for farmers is unreasonable.”