J.P Gervais at FCC Ag Outlook 2018 conference in Chatham. February 27, 2018. (Photo by Sarah Cowan Blackburn News Chatham-Kent).

Rising Production Means Looking For More Efficiencies

There is a rising tide of production in the world and Canadian farmers need to continue to focus on efficiencies and increased production of commodities to stay competitive.

That’s the message from J.P. Gervais, the chief agricultural economist for Farm Credit Canada.

In a release, Gervais states that recent years of record-high production have boosted global stocks of many agriculture commodities. But even as the planted acreage of major crops in the United States is expected to be lower than its high in 2012-14, improvements in yields allow for continued growth in overall production.

“Our long-held reputation as a safe and reliable producer of high-quality food opens the door to existing and new export markets, but competitive pressures are mounting,” Gervais said, in releasing the latest outlooks for the agriculture and agri-food sector. “The game is quickly changing and it’s becoming more and more evident that it’s mostly about volume and value added.”

And for Canadian agriculture that means an investment in innovation that will enable continued growth in productivity.

Gervais adds increasing productivity doesn’t necessarily mean Canadian farmers need to expand their operations but finding ways of reducing costs.

And changing food preferences are also driving investment decisions.

Gervais uses milk production as an example, where in Canada is trending upward, requiring further investment in processing capacity.

“Canadian producers need to find ways of reducing costs while increasing productivity from their existing operations, whether that means increasing the yield per acre or getting more butterfat from a litre of milk,” he said. “Investments in innovation and technology will go a long way in ensuring Canadian agriculture remains productive, competitive and sustainable.”

And Canadian consumers also seek healthy and convenient food products, which is expected to trigger more investments in pre-packaged and easy-to-prepare foods.