(Montreal) Canadian farmers are feeling the repercussions of Canadian sanctions against Russia while having to pay a 35% tariff on Russian fertilizer imports. A group of Canadian producers is asking for federal intervention to lessen the shock.
Posted at 3:52 p.m.
Updated at 4:46 p.m.
The group that includes associations representing grain producers in Quebec, Ontario and the Atlantic provinces estimates that “approximately” 660,000 to 680,000 tonnes of nitrogen fertilizers are imported from Russia in the three regions. Canadian. This would represent between 85% and 90% of all nitrogen fertilizers used.
“It brings significant additional costs for agricultural producers, reacts the chairman of the board of directors of Sollio Cooperative Group, Ghislain Gervais, in an interview. We are asking for support from the federal government to compensate agricultural producers for these tariffs. »
Mr. Gervais, who is also a chicken and grain producer, estimates that the tariffs will have resulted in additional costs of between $10,000 and $15,000 to his business. For all Sollio member producers, this could represent additional costs of 30 million. “By combining the increase in fertilizer prices and tariffs, we are talking about a price increase that can go two to three times. »
Canada’s supplies were disrupted by the Russian invasion of Ukraine, explains Maurice Doyon, full professor at the Faculty of Agriculture and Food Sciences at Laval University. “Canada is a major producer of potash, but when it comes to nitrogen fertilizer, we imported a lot. It came from Russia and Ukraine. We find ourselves in a more difficult situation in terms of what is available to our farmers. »
Finding other suppliers would not help grain producers much, adds the professor, who points out that prices are determined by the world market. “For example, we are potash producers. If potash becomes scarcer on world markets, it will increase prices on the planet and we will also have to pay that price. »
Another tile for agricultural producers
The tariffs decreed in March, in the wake of the Russian invasion in Ukraine, add to an already difficult context for farmers who have to deal with the increase in their inputs such as fuel and machinery, deplores the president of the Producers of Quebec grains, Christian Overbeek. “We do not need to suffer this additional tax there. Already, the value of the basic good [l’engrais azoté] had doubled or even tripled [avant les tarifs] compared to 2021.”
The exit of the producers does not call into question the importance of supporting the Ukrainian people, insists Mr. Overbeek. “Producers understand, but they don’t want to bear the brunt of it alone. If it is a societal decision, it is normal for society as a whole to bear the costs. »
The 35% tariff on Russian fertilizer does not on its own explain the spike in food prices at the grocery store, but it adds to a series of factors that affect the price of the plate of Canadians , says the representative of the grain producers. “In isolation, each factor may have a minimal effect, but when you add them together, it brings the impact that is seen by consumers who shop for groceries. »
Agriculture and Agri-Food Minister Marie-Claude Bibeau did not comment directly on the grain producers’ exit. She pointed out, however, that the government has already put in place various assistance programs, including changes to the Advance Payments Program, which would lead to “average savings of $5,500 in interest costs over the next two years” for program participants.
“Producers continue to have access to a suite of business risk management programs,” she wrote in an email. We will continue to provide our farmers with the tools and resources necessary to enable Canada to do its part in this time of global food insecurity. »
Ottawa is in a difficult position when it comes to finding the right balance between supporting the Ukrainian people and supporting the country’s agriculture, believes Professor Doyon.
The Russian sanctions come at a time when the war in Ukraine is raising issues about grain access and affordability across the globe, he adds. “If I reduce the tariff, I help Canadian farmers and I will have a smaller increase in grain prices. On the other hand, I send money to the Russians. »