The importance of diversified market development for agriculture

It wasn’t all that many years ago that the focus for agriculture in Saskatchewan, at least from a provincial government perspective, was diversification.

There was a realization within the last 25 years, that the tried and true focus on growing high quality wheat for export, while at times profitable, was also volatile in the sense of being tied to a single commodity where the ups and downs of supply and demand economics were further muddied by government policies around the world.

article continues below

The suggested answer to such variable markets was to promote farms that grew a more varied crop mix or added livestock to the mix.

Producers took the idea of diversification to heart, and all manner of crop and critter began to spring up on Prairie farms.

There were fallow deer and meat goats, ostrich, emu, pheasants, wild boar, elk and a few others in terms of livestock.

In the field, producers were growing caraway, coriander, lupins, sea buckthorn, pinto beans, haskap berries and spelt.

In general terms the issue with each was that while farmers could produce them well-enough, which is their forte, markets were at best ‘iffy’. There was the hope that if production was there a market would develop, but in most cases that egg broke long before the chicken were hatched.

There were a few diversification efforts that managed to grow markets and hold some relevancy in regards to still being part of farming today; bison and pulse crops perhaps the most notable.

Other efforts, such as fallow deer and ostrich, are all but extinct from farms here today.

We have of course seen the reliance on wheat decline, but that is largely because canola has become the primary crop in its place. We have in essence replaced a reliance on one crop with a reliance on another, albeit a new one with a higher cost-of-production.

And here we are headed to planting season 2019 with huge question marks surrounding the market for canola which are not related to supply and demand, but are instead related to the posturing of a government, in this case from China.

The reasons are different, the players different, but the result is the same. A farm sector largely reliant on a single crop is certainly at risk when the market for the crop is put under pressure, and that holds today for canola just as it did for wheat when trade subsidies were buffering Canadian sales.

It is unlikely farmers will push to diversify as they did in the past. But one does wonder if more effort had been made in terms of market creation, we might be less threatened by the Chinese posturing if farming was just a bit more diversified today?