Thank you very much.
Good afternoon, Mr. Chairman and members of the committee. I'm pleased to provide insights and recommendations from the National Farmers Union regarding agriculture and agri-food's supply chain issues. We represent farmers who operate all scales and types of farms across Canada. We've advocated for economic dignity, social justice and ecological health for over 50 years.
Today's topic is timely indeed but the acute supply chain issues that we face now have roots going back decades. Canada has set ambitious goals to increase agricultural exports, and our reliance on imports has increased. Multinational companies pursue global sourcing and just-in-time delivery to minimize their costs. Our food and agriculture system has now become dependent on long, complicated supply chains with weak links creating vulnerabilities.
We see ever-greater concentration with fewer and larger companies controlling inputs, processing, transportation, financing and distribution. When a small number of corporations dominate their sector, they are able to set prices to maximize their own profits at the expense of individual farmers, workers, small businesses and consumers.
A case in point is that of fertilizer. Companies charging exorbitant prices blame supply chain issues, and yet these same companies are making huge windfall profits. The NFU has asked this committee to investigate all the factors behind fertilizer prices, and we hope you will announce such a study very soon. As farmers, we are price-takers. We have no say in the price of commodities we sell or the inputs we buy.
In January, Statistics Canada reported that farm families continue to depend on off-farm sources for nearly two-thirds of their family's income. Furthermore, farm income includes program payment money, so income from the market averages less than one-third of farm family incomes. Farm families are subsidizing the system with their off-farm jobs. When agricultural supply chains break down, farmers bear the brunt of the costs.
For rural people, the supply chain is a one-way street such that the results of their work and the value of their crops and livestock disappear into the bank accounts of distant multinational companies. It is not surprising that so many feel left behind. Increasing economic inequality leads to social instability and disempowerment.
The climate crisis will also continue to disrupt production and infrastructure. The prairie drought of 2021 and B.C. and Atlantic floods cannot be seen as outliers but as signals that adaptation is no longer optional.
Resolving supply chain vulnerabilities requires planning to prioritize resilience and stability instead of putting all of our policy eggs in the export-maximization basket. Going forward, agriculture policy should be designed to build in safety valves and surge capacity so that disruptions are manageable challenges instead of full-scale crises.
We urge the committee to avoid the appeal of false solutions such as big data, automation and artificial intelligence, which would intensify inequality, reduce farmer autonomy and create new risks. True solutions will rebalance power, bring greater fairness and equity into our food system, and mitigate greenhouse gas emissions while implementing adaptation measures. The federal government can do this by providing the program, policy and regulatory support needed to develop and sustain our domestic market, creating broader and more diverse supply networks while retaining more of our high-value food dollars within Canada.
Whether the sector is beef, pork or vegetable processing, concentration of infrastructure ownership means that the packers, processors and retailers are benefiting regardless, but in all of these sectors, our past shows us that a different way of organizing our food system is both possible and desirable. Let's use the beef sector as an example. In 1988 there were 119 federally inspected beef-packing plants in Canada. All were 100% Canadian owned and the four largest beef plants killed 35% of Canada's cattle.
Now just two companies slaughter over 95% of our cattle. They failed to prevent COVID outbreaks and deaths, and cattle prices are low while grocery beef prices are skyrocketing. More smaller abattoirs located throughout Canada and available to serve producers in every region, coupled with regenerative production practices, would provide food system resilience and rural jobs as well as climate mitigation and adaptation benefits.
Banning captive supply and legislating caps on packing plant revenues would stop companies like JBS and Cargill from taking unfair advantage of farmers and consumers.
By learning from history and envisioning a more equitable and climate-friendly future, the federal government can create a better framework for rural jobs, infrastructure to serve farmers and farm prices that reflect the cost of production, to bring prosperity and stability to Canada's rural communities and agriculture sector.
I believe my time has nearly run out, so I thank you very much for your attention today and I look forward to answering your questions.