Government agriculture supports at record low in 2011, says OECD

PARIS – A Paris-based think tank says government support to agriculture fell to a record low of 19 per cent of total farm receipts in 2011.

The Organization for Economic Co-operation and Development says this was driven by developments in global commodity markets, rather than by explicit policy changes.

The OECD says support to producers stood at $252 billion in OECD countries in 2011, confirming a longstanding trend toward falling farm support.

That support varied widely across OECD countries from 2009-2011, from a low of just one per cent in New Zealand to 60 per cent in Norway.

The agency says the level of agricultural support in Canada was 16 per cent, which was below the OCED average of 20 per cent.

The figure for the United States was nine per cent.

The OECD also says total support to agriculture as a percentage of national income fell from three per cent in the 1986-88 period to less than one per cent in 2009-11.

The agency also applauded the federal government’s recent move to lift the Canadian Wheat Board monopoly on wheat and barley sales in western Canada.

”The recent decision to remove the monopoly … both for domestic use and export, is a positive step to enhance proactive price risk management by farmers,” said the OECD report.

The OECD noted that the dairy, poultry and egg sectors ”continue to receive high price support.”

”Budgetary policies have become tightly focused on risk management for farm operations, with several programs with overlapping mandates and impacts.

The report also questioned Canada’s ad hoc approach to responding to disasters, such as droughts or floods.

”Those programs have become institutionalized,” the report said, suggesting they ”could better be handled by existing programs.”