The Group for Financial Co-operation and Growth (OECD) lately revealed its annual report on estimates of support to agriculture, titled the “Agricultural Policy Monitoring and Evaluation 2021.”
The report displays and evaluates agricultural insurance policies in 54 international locations, together with the 38 OECD international locations, 5 non-OECD EU Member States, and 11 rising economies.
Between 2018 to 2020, agricultural support insurance policies throughout the 54 international locations included in the report generated US$720 billion in support, averaged yearly. In contrast traditionally to 2000 to 2002, that quantity has doubled; however Martin von Lampe, senior agricultural analyst with OECD, factors out that inflation has additionally elevated, and sector measurement has grown over time. He lately joined RealAg Radio host Shaun Haney to speak concerning the report, and the way Canada stacks up in phrases of ag coverage and support programs.
“The big chunk of those US$720 billion, in fact it’s US$540 billion per year goes to individual producers,” says von Lampe. “So the biggest share, almost three quarters of all positive transfers go to individual producers.”
The report additionally breaks down how that cash is funnelled in the direction of producers, and von Lampe says that there are two methods: market worth support and budgetary support, each of that are equally distorting. Market worth support primarily comes from insurance policies that raise home costs, the place the top cash comes from shoppers. Budgetary support is paid by taxpayers, not by the use of consuming one thing however by the use of paying taxes to the federal government, says von Lampe.
There are regional variations, in phrases of the extent of support, the place farmers in non-OECD international locations obtain 11 per cent of all gross farm receipts. “It’s higher in the OECD countries, there it’s about 18 per cent, and it’s lower in the emerging economies,” says von Lampe. He provides that there are additionally variations in the construction of helps.
Canada is under the typical, just below 9 per cent of gross farm receipts in support coming from public coverage.
“What’s interesting with Canada though, beyond that, is that essentially you have a dichotomy between a complete open type of policy where markets are really very much focused, international markets, and then you have those few markets that are under supply management, very much controlled,” says von Lampe.
Take heed to the total interview between von Lampe and RealAg Radio host Shaun Haney, for extra findings of the report and the “triple challenge” confronted by global meals programs: