Regina Leader-Post 16 March
Agricore chief urges caution on biofuel
SASKATOON -- A lot of farmers and small-town economic developers on the Prairies are counting on biofuel development to put some profit back into farming, but the head of Canada's biggest grain handling company isn't so sure it's our future.
Brian Hayward, CEO of Agricore United, told farmer delegates of the Western Canadian Wheat Growers Association (WCWGA) that it's quite possible Canadian farmers can't make ethanol or biodiesel from wheat and canola as cheaply as other countries can from sugar or palm oil.
Hayward says there is such a heavy expansion right now of U.S. corn acreage for ethanol production at the expense of wheat acreage that it may actually increase U.S. demand for high quality Canadian wheat. (American grain giant Archer Daniels Midland, which owns 23 per cent of Agricore United, is building six new ethanol plants in the U.S. this
year.)
High energy costs will also make North American markets in general more attractive for farmers than traditional Canadian export markets for grain overseas, Hayward predicts.
"In a high-energy situation, it costs more to freight grain to China or India or wherever," he said.
"In that kind of market situation, we're going to find that places like Mexico and the United States are going to be probably some of our more attractive markets".
The president of the WCWGA, Cherilyn Jolly-Nagel of Mossbank, says she doesn't necessarily agree with Hayward on the future of biofuels. Jolly-Nagel is also a rural economic development officer for Mossbank and says the community is looking at building a biodiesel facility in addition to a value added project for mustard processing.
"I would like to see us jump in with both feet, especially in a province like Saskatchewan where we have that opportunity and that oversupply and 'underprocessed' situation," she said.
"The thing with biodiesel and ethanol, it can be a major undertaking, but it can also be done on a small scale which is going to enable these small communities to continue and prosper."
Hayward later told reporters he didn't mean to suggest farmers shouldn't invest in ethanol or biodiesel, but they should not to pin all their hopes on it.
"There is a place for Canada to be participating in growing livestock; there is a place for Canada to be participating in alternative energy, and there is a place for us to be exporting raw grains and value-added as well," he said. "I don't think it's in our best interest to put all our eggs in one basket."
Hayward said the question of succession for today's aging farmers is probably one of the most important farm issues that needs to be addressed in Canada, acknowledging that fewer people raised on a farm want to stay in agriculture.
However, the grain industry official says that despite the gloom about the short-term future and the tough financial position many farmers face this spring, most farmland will be put into production.
Longer term, he says the consolidation pattern of fewer, larger farmers will continue.
"I think that trend can continue into the future and you can have still larger farms with fewer operators," he said. "The demographic challenge is on the horizon."
Jolly-Nagel says she is almost always one of the youngest producers at any farm meeting she attends, but says that she and her husband both see the possibilities in making their farm profitable as long as they can get to make their own marketing decisions.
The WCWGA has long held the view that farmers need to have a choice in whether they can market wheat or barley through more direct channels than the Canadian Wheat Board.
Jolly-Nagel says the organization will deal with that issue at today's sessions .
She admits to disappointment with the hesitancy of new federal Agriculture Minister Chuck Strahl to move quickly on that issue.
"I can appreciate where he is coming from as a new minister."
While Hayward did not speak directly in support of dual marketing, he says Agricore United does know how to market grain in a dual market and will be ready for that situation if it occurs.
Parsley
Agricore chief urges caution on biofuel
SASKATOON -- A lot of farmers and small-town economic developers on the Prairies are counting on biofuel development to put some profit back into farming, but the head of Canada's biggest grain handling company isn't so sure it's our future.
Brian Hayward, CEO of Agricore United, told farmer delegates of the Western Canadian Wheat Growers Association (WCWGA) that it's quite possible Canadian farmers can't make ethanol or biodiesel from wheat and canola as cheaply as other countries can from sugar or palm oil.
Hayward says there is such a heavy expansion right now of U.S. corn acreage for ethanol production at the expense of wheat acreage that it may actually increase U.S. demand for high quality Canadian wheat. (American grain giant Archer Daniels Midland, which owns 23 per cent of Agricore United, is building six new ethanol plants in the U.S. this
year.)
High energy costs will also make North American markets in general more attractive for farmers than traditional Canadian export markets for grain overseas, Hayward predicts.
"In a high-energy situation, it costs more to freight grain to China or India or wherever," he said.
"In that kind of market situation, we're going to find that places like Mexico and the United States are going to be probably some of our more attractive markets".
The president of the WCWGA, Cherilyn Jolly-Nagel of Mossbank, says she doesn't necessarily agree with Hayward on the future of biofuels. Jolly-Nagel is also a rural economic development officer for Mossbank and says the community is looking at building a biodiesel facility in addition to a value added project for mustard processing.
"I would like to see us jump in with both feet, especially in a province like Saskatchewan where we have that opportunity and that oversupply and 'underprocessed' situation," she said.
"The thing with biodiesel and ethanol, it can be a major undertaking, but it can also be done on a small scale which is going to enable these small communities to continue and prosper."
Hayward later told reporters he didn't mean to suggest farmers shouldn't invest in ethanol or biodiesel, but they should not to pin all their hopes on it.
"There is a place for Canada to be participating in growing livestock; there is a place for Canada to be participating in alternative energy, and there is a place for us to be exporting raw grains and value-added as well," he said. "I don't think it's in our best interest to put all our eggs in one basket."
Hayward said the question of succession for today's aging farmers is probably one of the most important farm issues that needs to be addressed in Canada, acknowledging that fewer people raised on a farm want to stay in agriculture.
However, the grain industry official says that despite the gloom about the short-term future and the tough financial position many farmers face this spring, most farmland will be put into production.
Longer term, he says the consolidation pattern of fewer, larger farmers will continue.
"I think that trend can continue into the future and you can have still larger farms with fewer operators," he said. "The demographic challenge is on the horizon."
Jolly-Nagel says she is almost always one of the youngest producers at any farm meeting she attends, but says that she and her husband both see the possibilities in making their farm profitable as long as they can get to make their own marketing decisions.
The WCWGA has long held the view that farmers need to have a choice in whether they can market wheat or barley through more direct channels than the Canadian Wheat Board.
Jolly-Nagel says the organization will deal with that issue at today's sessions .
She admits to disappointment with the hesitancy of new federal Agriculture Minister Chuck Strahl to move quickly on that issue.
"I can appreciate where he is coming from as a new minister."
While Hayward did not speak directly in support of dual marketing, he says Agricore United does know how to market grain in a dual market and will be ready for that situation if it occurs.
Parsley
Comment