Thank you for the opportunity to appear before you today. My name is Leroy Fjordbotten. I farm at Granum, south of here. People often don't know where Calgary is, so they usually ask where it is from Granum. So if you're asking the other way you probably have been in Granum.
With me is Lorne Darlington, the executive director of AGCAT.
The agricultural institute today is undergoing great change, and to ensure that producers have the ability to adjust to that change, they must have no impediments to those changes. In order that agriculture will remain strong, producers and governments both have to act quickly to respond to consumer and world market demands. We compliment your committee on the diligence you have had in listening and, we hope, in making some recommendations coming out of your hearings with respect to the changes that are needed.
AGCAT, the Alberta Grain and Oil Seeds Crisis Advocacy Trust, is a group some of you may not have heard of, so I'm going to take a couple of minutes to tell you who we are.
First of all, we're not a commodity-specific group. We are not a full farm organization in the full sense of the word. We are not critics or complainers, and we do not have a policy on every issue facing agriculture. We don't blame anyone for policies that are in effect, and we don't care who gets credit for good policy development as long as we end up with good policy development.
Who are we, and why should you listen to anything we say as being credible?
AGCAT came about because a few dedicated producers saw no one organization speaking on behalf of grain and oilseeds producers. And that isn't said to be critical of anyone; however, it's a fact of the environment we live in. Grain and oilseeds producers are in crisis and needed help to plead their case, and the group has grown across western Canada. We have close to two million membership acres. Members join AGCAT based on the acreage they have, and we have both large and small.
I was asked, as the former minister of agriculture for Alberta, to advise the group. I serve in that role, and I'm also chairman of the board of AGCAT.
Since its inception, AGCAT has been asked for and has given confidential advice to governments on specific major issues facing producers. We've done it in a quiet way, with no fanfare and no publicity, but we want to make sure the best advice is given. We identify the issues and we provide constructive solutions.
In our group we have former senior politicians from all parties advising us on resolution of issues. Some top accounting firms have given us their senior partners, and they run models of any solutions we propose to give the upside and the downside and how it would work and how it wouldn't work. All our board members are individuals who are actively farming and are highly respected managers.
We do not publicly seek credit for those solutions, and there have been many so far. Our goal is to get positive results and security and growth in the grains and oilseeds sector.
In politics we hear numerous complaints all the time about policies that are working or not working and of the desire to have new policies put in place. However, we need not overhaul entire policies often, but rather, we need government to remove impediments that hinder good programming and delivery. It is important to listen closely and act decisively on any suggestions that are made and to listen to those suggestions from people who actually have their hands in the dirt.
I don't wish to sound negative to civil servants, but as Dwight Eisenhower said, it's easy to be a farmer if you're a thousand miles from a farm and your plow is a pencil. It's a lot harder when you've got your feet on the ground and you have to make those decisions based on sound economics and principles of where you live. Civil servants are necessary, and I think they can learn from producers, and we in turn can learn from them. But you have to be sharp to survive in the new world environment, and removing impediments will make life a lot easier and more productive.
Today you've already heard, I'm sure, and you'll hear more, from groups that are critical of a number of things happening in the country, and rightly so. An example is the transportation sector, with strikes and the impact they have. The KVD issue that Mr. Vandervalk just alluded to is one that I think is extremely important, and crop insurance is another one that isn't really meeting the needs of producers today in a very effective way.
I'm not trying to minimize that, but we had to pick a couple of issues, and I didn't see any sense in duplicating other issues that other people were raising. I'm not trying to minimize that or highlight that these are the most important. I know you came here and I know you're interested in business risk management, and that is a very good topic. Trying to define it in itself is a tough topic.
What is business risk management? I don't mind risk, because without risk you don't have opportunity. There are risks. One I'd like to raise with you is the cap on programs. I was told not to raise this one because it's too sensitive and nobody wants to touch this issue because you're perceived as only caring about big guys and not little guys, but that isn't the truth.
Producers don't like programs very much; we would rather the marketplace provide the returns and just get out of our way. But until the playing field in the world is levelled, we need programs to keep producers viable. This issue is such a sensitive one, and just caring about bigger farmers is not where we are, because in our group we have large and small farmers both. Governments always worry about a large cheque going to somebody, so they want to put a cap on the program so that they don't have large cheques going out. That can be sensitive publicly, so as we encourage producers to grow in size and become more efficient through economies of scale, they've done that and they've spread their expenses--their equipment and capital costs--over more acres.
I'd like to say this twice. Each and every acre must cashflow itself. Again, I say, each and every acre must cashflow itself. When we work out a business plan, we work on our cost per acre and we use forward pricing. We use all these, and we need to keep our costs below returns. When governments cap programs, that creates huge things. I'll talk more about how relevant that is.
The other program I want to raise with you is the GROU program--the grower requested own use program on chemicals. There are some wrinkles that need your attention in that particular program. For example, there are emergency registrations now happening. There's one for the pea leaf weevil in peas that's been approved. We need one for cheatgrass in southern Alberta, and there is a chemical we will have in 2008, but we have nothing in 2007. There is one that you could work on.
There's another wrinkle. I know my time is nearly up so I want to make sure that I cover it. When you import chemicals, they usually come through organizations or farmers have a growers certificate that they import chemicals with, and it usually comes out of some farm locations. It bypasses the local chemical dealers in the local communities, and that means there's thousands of dollars being taken out of rural communities. Why can't our own dealers and our own communities work on the same level playing field as producers in importing some of these chemicals? We're taking thousands of dollars out of rural communities all across this country by not allowing something like that to take place.
I have a number of other things I'd like to raise, but I'll just say that it's a pleasure to appear before you today and I look forward to the rest of the hour.
Thank you.