What is the value of cheap food?

Food Freedom Day in Canada

Many consumers are not aware of how their buying habits affect our domestic food supply. In Canada we are one of the first western nations to reach Food Freedom Day — the date the average Canadian has earned enough to pay his or her entire year’s grocery bill, including alcohol. In 2011 it fell on February 12th — only 40 days into the New Year and averaged about 12% of a person’s annual income. For many people cheap food is a reason to celebrate; who can’t use more dollars in their pocket?

But not everyone is jumping for joy. In the last 30 years, how we eat has changed dramatically — ready-to-eat value-added meals have become the norm. We are all so busy keeping up with our day-to-day lives that we don’t want to stop and prepare a scratch meal. But how does this affect our food system?

How Cheap Food Affects the Alberta Family Farm

If you weren’t aware, most of the prepared foods that you purchase — both mainstream and organic — are owned by a handful of multinational corporations. If you would like to learn about who owns some of your favourite organic foods brands, please see this interesting diagram: Organic Industry Structure.

Large multinational corporations have one primary goal — to make profits and keep their shareholders happy. To gain market share for a particular item, like pasta, pizzas, cookies, or potato chips, these companies have to be competitive in the retail marketplace, and do this by offering consumers the lowest price possible. To keep prices low, they pay the lowest price possible for agricultural commodities like grain, livestock or vegetable crops that go into their product ingredients. These commodities are traded internationally on the stock exchange and force Canadian producers to compete in a global economy that is not a level playing field. How can a rancher in Alberta compete with a rancher in South America or Australia when the latter don’t have winter? Winter feeding costs are the largest expense on Alberta ranches. Unfortunately Canadian farmers have little leverage in this arena and as a result are often paid less than their costs of production.

This cheap food policy has detrimentally affected the small family farm in Canada. The graph below shows how profit margins for retail food have increased dramatically while profits to farm families have stayed relatively low:

As a direct result of this cheap food policy, more than 74% of farm and ranch families have either one or both spouses working off the farm to make ends meet. Imagine working an 8 hour day only to come home and have to work another 8 hours to get the chores done. In agriculture this has become a reality and its fallout has far reaching consequences. Very few farm and ranch families have children that want to stay on the farm. They have grown up watching their parents sacrifice and struggle to keep the family farm going and don’t want to carry on the legacy. We are in a serious crisis in Canada and the graying of our farming population is upon us. Farm closures and auctions are increasing at an alarming rate and what does this mean for our food supply? It means that fewer farms and ranches will remain and those that do will get bigger and more intensified to meet market demand. As producers are squeezed to decrease their costs of production, more and more will adopt the factory farming model to make ends meet. It’s cheaper to raise 60,000 chickens in a barn than 2,000 — unfortunately the economies of scale are not in favour of the small family farm.

In the United States, large and corporate farms account for 92% of all hog production and 96% of all poultry production. During the grain finishing process, between 80 and 90 percent of cattle production is concentrated in less than 5 percent of the nation’s feedlots (read more at farmandranchfreedom.org). Canadian production methods do not differ that much from our US counterparts and I’m sure we are moving towards similar numbers if we are not already there. Putting all of our eggs into the factory farming basket is not secure — we need to diversify if we are to build stable farming communities.

The Food Monopoly — Is it Secure?

On TK Ranch we are very concerned about the security of our food system. If we cannot attract young farmers back to agriculture there is a real threat that multinational corporations will purchase much of our agricultural lands and control our food system even more. When almost all of the foods that we eat are manufactured by only a few multinational corporations, how can we as Canadians feel our food supply is secure? Our food system has become a monopoly that threatens our ability as consumers to choose the foods we want because they might not be able to compete in a global economy. Small family farms provide alternatives to this monopoly and the only way to make change it is to ensure we have diverse and healthy farming communities. When making your buying choices choose locally produced food and help secure a healthy future for our rural and urban communities.