Thank you for the opportunity to speak to you today.
I'm Kyle Foster. I'm 34. I'm a young farmer from Arborg. I also sit on the KAP executive—that is the Keystone Agricultural Producers. I farm along with my dad, who is 65 this year, and my brother, who is 39. Our farm is a family farm that was established 107 years ago. We crop about 5,000 acres of canola, wheat, oats, and some forages. We also have a small elk herd and we are former hog producers.
We went through an ownership change in 1999, when we bought out my uncle's share of the farm. His kids weren't interested in farming. I think the biggest reason his kids weren't interested in farming was because he kept telling them, “You don't want to farm. There's no future in farming.”
In preparing to come here today, I asked my dad last night how many farms our operation has taken over since he started. He came up with the number of 15 farms, and those farms have taken other farms over. We're not in a big area and we're not a big farm. It's scary and alarming to see how many farms just one operation can take over.
We're definitely losing ground on our neighbours. There would be nothing better than to have a good, healthy community, but the bottom line is that guys aren't making money at 600 acres anymore. They all of a sudden think that they need to have 2,500 acres plus to make a living.
Here are a couple of the issues I see explaining why we aren't getting a lot of the young farmers.
One is stability. Right now we're coming off the wettest two years we've ever had. Last year, in 2009, probably fewer than half of the acres were seeded in our area. In 2008, half the crop got burnt. If you can go without an income for two years at a time, it's not bad, but it's pretty tough when you're mortgaged to the hilt as a young farmer.
There are programs out here such as AgriStability and AgriRecovery. Well, it's May 2010, and I haven't gotten an AgriStability cheque yet for the crop we lost in the 2008 crop year. The reason for that is that my year-end is February 28, so I couldn't apply for my AgriStability payment until the 2009 application came out, which was a year later. The corporation accounting said we should have our year-end separate from the fiscal year end, so now we're getting punished for that.
Now we're two years down the road and we still haven't gotten any cheque for 2008. Of course, I can't apply for 2009's until next year, so there's definitely a big draw here that we're missing. Coming into seeding time, we could really use any kind of support we can get.
AgriRecovery seems to be a program that works under certain conditions. Right now we have a provincial government that is mostly urban MLAs, an NDP government with no money. They have to get along and agree with a federal Conservative government, and so far we have had not much luck.
These programs have to be predictable and bankable. I have a neighbour, for example, one of the guys whose land we had to rent about three years ago. He invested in the hog industry. He had to rent his land out and sell a bunch of land off, and he got his AgriStability cheque about 11 months later. Had he gotten his AgriStability cheque on time, he would probably still be farming.
Another issue I have, and I guess maybe this is the wrong crowd to talk to, is that we're getting constant regulations put on us. When we bought our farm—we have a small hog operation—it was a family operation. We have concrete pits and we had to put down winter spread; that was the only way we could do it.
Right now, they're putting a ban on winter spreading. For us to go out and spend half a million dollars to have slurry stores and keep that manure over the winter, we'd have to expand our hog operation probably three times. But we're also in a hog moratorium area where we're not allowed to add on to our hog barn or build any other hog barns. So officially, they have just shut down our hog operation.
We have other issues. They have come in and regulated fuel tank storage. They're in the process of regulating on-site wastewater management. There are buffer zones around secondary drains. Minimum wages are going up. We always had private insurance for our employees, and now we're forced to go with workers' compensation, which is more money for less coverage. This is another problem.
These are all expenses that have been thrown on us in the last few years. As young farmers, we just can't handle these extra costs.
The biggest reason I can see for young farmers not getting into the industry is the fact that there's no money. That's what my uncle told his kids, and I hear this constantly. They're just not making enough money, and it's not worth the time and the effort to farm.
We are getting such a small share of the food dollar. Through Keystone Agricultural Producers, we did a project called Farmers’ Share on what percentage of the food dollar goes back to the farm gate for one week for a farm family. From 2008 to 2009, the cost of groceries went up by 3.2%. Farmers received 1.7% less than they did in the previous year. The customer paid $6.01 more per week. Farmers got 86¢ less per week. And the middleman got $6.87 more. For our grain products, we got about 5% on bread, and on oatmeal the farmers' share was 2%.
We take the biggest risks. We have to bank on the weather. We input a lot. And unless something changes where we can see more dollars coming back to the farmers, I think you're going to see more and more of a decline.
I've often thought the only way we can make this work is with a food tax. That's the only way we can get some control over what comes back to the farmers. I think about Kellogg and what Kellogg's boardroom table must look like when they're deciding what they're going to charge for a box of Frosted Flakes. They don't sit back and say they're going to pay the farmers this much and they've got to get this much for the box so they'll take a 15% markup and they'll send it out the door. They sit back and think about the most the consumer is going to pay for this product--how much they can get for it.
So why can't we try to get into their profits a bit? They're still going to charge the most they can charge, but maybe we could get a couple of percent back. A lot of people think it's going to cost the consumer more, but the fact is they're already charging the most they can possibly charge. So maybe it's time we got some of that share back.
I have a couple of other things. There's definitely a need for some succession planning, some financial planning, some training, interest-free loans, and low-interest loans. But still, the bottom line is this: do you want to take all this risk and borrow all this money when you're not going to get the payment back? It's tough.
I have a couple of other things I would like to talk about. We have an elk herd. And when we started with elk, this was something we started before we separated with my uncle, because we thought it would be a good opportunity for a young farmer to start with something small. You could run an elk ranch off of a quarter of land, which wasn't a huge investment. Unfortunately, with the chronic wasting disease and not a lot of producers, we've lost most of the elk farms. The ones that are still around have no money, and they haven't made any money. It's something we really have to work on through government, to open up some of these borders again, to get some of this trade going in the elk industry. To me, it is one industry that would work really well to get young farmers back on the farm with minimal expense.
Some revamping definitely needs to be done in terms of the Canadian Wheat Board, but the fact is that everybody in this industry, in agriculture, is trying to get a monopoly. Whether it's Viterra, whether it's the canola crushers, the fertilizer plants--everybody is after a monopoly. We have a monopoly on our wheat and we're trying to get rid of it? This doesn't make sense. This is a company we need. We need the pool.
About 1995 we had single-desk selling for hogs in this province. Things were going consistently well. We had five or six packing plants. Since we lost our single-desk selling, we basically have one guy dictating the price they're going to pay us. So we have to keep the Wheat Board intact. They're looking out for our best interests. It's a farmer-elected board. I would hate to see it disappear.
Lastly, in terms of the mergers we see in the agricultural industry, like Viterra, right now if we want to get anhydrous for our farms, the only place we can buy it is Viterra. The competition branch has done nothing to stop them. They keep on buying up more and more. Just this week they bought up a couple more independents. And if we want anhydrous, we have to go an hour away to get it from the next competitor. That's a big issue for us. I hope somewhere along the line the competition branch will slow this down a little bit.
Other than that, thank you.