January 2008 Archives

Current grain prices are bringing genuine smiles to the face of many a Prairie grain producer. It is good to see grain farmers with such optimism. They have faced a number of financially difficult years and now they have some good prospects. How long this will last, no one knows. If you had a chance to examine last week's posting you would have read that this period of high grain prices has been forecasted to last anywhere from two to ten years, depending on which expert you ask. Let's hope it is for a while.

Many Prairie grain farmers have received substantial government transfers in previous years. I was one who argued that the government should support grain farmers, an argument not appreciated in all quarters. Hopefully the industry will evaluate what impact, good and bad, the past transfers had on the grains sector.

While the grains sector is experiencing good times financially it is important to address the secondary challenges that come about as grain prices rise. Keeping these effects in mind may help the agriculture industry make the most of the current opportunity. Some of the secondary challenges are local, some national, and some international.

As we move into a new year, the question "What does the future hold?" is on many people's minds. The general optimism exhibited at the Crop Production Week in Saskatoon last week (January 5-12, 2008) provides one indication of what people in the agricultural sector are expecting. Industry analysts, who typically share the optimism of farmers and input suppliers, talk about a new paradigm and predict that high grain and oilseed prices can be expected for at least two years. Some suggest, like the Economist magazine in their December 6, 2007 article Food Prices: Cheap No More, that commodity prices could remain strong for as long as 10 years.

While it is important to try and predict what the future will hold, it is also necessary to do something else, particularly, perhaps, in a period when times are good. Specifically, it is incumbent upon everyone to think about what the future should bring, rather than what it could bring.

General farm organizations in Saskatchewan have had a colourful, and in some instances coloured, past. They have followed some interesting patterns - often established in the face of poor economic circumstances, their membership structure based loosely on some past organization's structure, and (most importantly) governed by, and only by, producers themselves. Ultimately, the demise of these organizations has also followed similar patterns - dilution of their focus or objectives and declining membership to the point of insolvency.