Do Canadian producers need to completely rethink the biofuel question? If you produce crops for ethanol or if you produce crops for renewable diesel, you might feel very differently about the answer to that question. We're going to talk about that on today's RealAg Radio. It is the Issues Panel. I'm hosting. Shaun Haney is away, but I've got Andrew Campbell, Tyler McCann, and Kelvin Heffner, all to tackle the biofuel question, to talk about US-Canada relations. Uh, the US and Mexico have meetings on the books for CUSMA slash USMCA review, but Canada does not. Should we be worried about that? Our Prime Minister was in New York giving a talk and, well, the US Ambassador seemed to like what he said. Should we care? All of that is coming up on today's RealAg Radio.
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It's time for RealAg Radio on Rural Radio Channel 147 on SiriusXM. RealAg Radio and RealAgriculture.com is your home for insight and analysis of the issues that are impacting your farm business. Let's get real and get connected with RealAg Radio.
Hello and welcome to RealAg Radio here on Rural Radio Channel 147 SiriusXM. It is Friday. I am your host for the day, Lyndsey Smith. Your regular host, Shaun Haney, is away today. Which means I get to host the issues panel. Let's bring them in. Why wait? Let's just hop to it. We have so much to tackle today. Bringing in our panel starting with Andrew Campbell with Fresh Air Media from Southern Ontario, Kelvin Heppner from Southern Manitoba, of course, with RealAg Radio, and Tyler McCann with CAPI based, I think, in Quebec today.
We'll see.
I think so. Looks like it. Okay, there we go. Welcome here, everyone. Kelvin, I'll start with you. What sort of exciting things did you get up to this week?
We had the arrival of summer here with temperatures in the mid-30s, so things are moving, the crops are— you can watch the leaves grow on the trees, you can watch the, especially the early cereals, they're popping and filling in the rows right now, so it's an exciting time. Also time to get in the sprayer and start controlling some weeds as well.
Yes, they will not wait for you, Calvin. They will rock and roll. Yes, and Andrew, what kind of spring are you having? Here in Ontario, it's been strange. So are you in the Goldilocks zone, or how's it going?
Well, you know what, I think we're in the Goldilocks zone right now. The sun is shining, temperatures are warming up, we kind of have the actual arrival of that really nice warm spring, and so it's one of those times where we were wet earlier in the week, so things were pretty quiet kind of everywhere around here, but Today, I know we're going to get back going at beans today, and I've seen corn planters and cultivators and hay bines, and it is going to be a very busy week here in Southern Ontario, I think. And with the way the forecast looks, has the potential to get the majority of the crop in in the next 7 days, I would say.
Okay, yeah, which is good.
We are—
I do feel like we're a little behind as far as planting would go, and the numbers would agree with me, but lots of other things off to the races, like forage, which Tyler knows all about. Tyler, what kept you busy this week? You had a big week over at CAFI.
We did. So on Tuesday I was at the Canadian Meat Council annual meeting talking on a trade panel there. Clearly meat processors in this country are awful concerned about the future of the Canada-US relationship and everything else going on, and we hosted something a bit different yesterday morning with some people in Ottawa, a policy hackathon looking at new ways of getting new ideas to solve some challenges. The context, building off of our risk report, was hey, if you had $500 million to spend, what would you spend it on? And so always interesting to hear different ideas when it comes to something like that.
Well, and the guardrails were based on risk management, not just $500 million, what do you want to spend it on.
So, our risk report is broad, right, and it looks at like the entire sector, looks at all of the challenges that are there, you know, one of the risks that we hear a lot about is regulatory issues, and so there were some people saying we need to take some of that money and put it to fixing regulatory issues, and it is, I think, forces you to think a little bit differently, and when you've got groups of people, there's some farmers there, there's some food processors there, some people from kind of other parts of the ag sector, you know, we've all got to get on the same page, and again, we tend not to have a lot of conversations like that in this sector where you've got a farmer and a food processor and someone else kind of blue-skying about how you'd spend money. Big question around whether or not that $500 million is enough to have much of an impact these days, and even if that, whether or not anybody, any governments in this country's got an extra $500 million to spend on agriculture, I think that those are big questions, but So that was the number we picked.
Mm-hmm. Calvin?
I'm curious what— if there were any innovative ideas that came out of it, and of course this comes as we're seeing the closure of AFC facilities this week. The Conservative Party came out and held a press conference alongside a number of farm groups, including some unlikely partners in the National Farmers Union and the like, the organic sector as well. Word is that some of the organic research plots at Swift Current have been disrupted this week and are potentially going into conventional wheat in the coming days. We're hearing that and working on that story. So, curious, obviously that's an example of where a few hundred million dollars could fund those research farms, and some people would probably say that would be one way of mitigating risk in the future, in the more long-term picture.
Yeah, there was certainly lots of talk about innovation and research and filling some of those gaps there. You know, I think that there is this sense a bit of you need to go back to the basics and we need to fill some of the gaps and holes that are there, that have happened, that have eroded over the years as money has been put to other things. I'll tell you, Mike Cable's idea had a really new, great, innovative idea and it was not widely endorsed by the room. Holding a bit of a grudge having lost out in the competition yesterday. But again, I think it speaks to the fact that before we look for anything new, I think that there's the sense that we need to do a better job fixing what we've got and making those foundations a lot stronger before we're off trying to do something new or random.
Andrew, as a dairy farmer, as a farmer in Ontario, where do you see some of the biggest gaps on the risk side? If we are talking about— I'm not going to ask you to spend the $500 million because you already built a barn, so close enough. But where would, if you had attended yesterday, where do you think you would have focused some of that money?
Well, I think I do like the idea of, you know, trying to bring down some of the regulatory challenges that exist or speed up some of that innovation, you know, that change. And I think because it is, as Tyler mentioned, you know, $500 million, it sure sounds like a lot, but it really doesn't go a long way, or it's really hard to spread that out kind of across the country and say, okay, we're going to help fund 3 type of capital projects. Well, then it's gone and maybe only focuses on a few sectors. I think probably one of the ways to do it would be, okay, how can we speed up, you know, some of the approval processes? You know, how do we, you know, work and actually, you know, maybe there's a little bit of opportunity to open up some trade offices in some new places that we haven't looked at before. You know, I think doing a lot of little things in places. And as you know, you kind of mentioned in terms of, you know, just trying to, you know, focus on how can we do that little bit in a whole bunch of sectors, fixing what's already there, probably is a pretty efficient use of $500 million. And then gives you a really good idea to say, okay, we did spend some money in a couple of sectors and actually didn't see results that we thought. Maybe that isn't the one we should then drop more money into. You know, we can focus on these that actually got us a really good return on that money quickly, and then, you know, put more in with the next $500 million that Tyler's going to give us all.
But I think one of the interesting questions in all of this, Lyndsey, is how do we— and kind of Andrew gets to this— but how do we understand the impact of all of the money that we're investing, right? And we don't do a great job of that. We certainly think about that in the policy framework context where they kind of spend the same money over and over and over again in every policy framework without that real sense of kind of what's changing. We invest $3.5 billion in the non-BRM side, $12 billion in the BRM side in the policy framework. After that $15 billion gets spent over 5 years, how is the world any different than it was before? Like I think that there are kind of some serious conversations that should be had there. I think the governments are having a little bit too along the way. That idea of having a clear sense of what we want money to be spent on, and then the ability to look and say, "Has it actually done that?" is something that I don't think that we do enough of in the sector.
And I would say the one other—
Oh, sorry, go ahead.
No, the one other piece to that that I think is different when we do talk about, you know, how some of the funding and, you know, through the policy frameworks, one of the complaints that I hear a lot from producers is putting money in on a programme for a year, and then it disappearing, and then a different programme the next year and it disappearing. I think even with that $500 million, it can't be a one-year project. It has to be, how do we give some certainty to the industry, no matter what it is, to let them actually make business plans, actually follow through, actually get it operating, versus just throwing it in one year and hoping it sticks and think— being surprised it doesn't because no one was ready for it.
So this brings up a couple things for me, but I do want to— Kelvin, you pointed out the strange bedfellows of the Conservative Party and the NFU having joint press conferences and the organic organizations. Just, this is the world we live in. In the NFU press release, they said that $473 million, so we're talking about this $500 million number, is what the government will spend on 13 of the World Cup games. And that would run the research farms for 20 years as their operating budgets. So that's the comparison that we're doing there. But on this point, Kelvin, of the impact assessment of some of these things, Carlo Dade a few weeks ago talked about where he viewed what Canada did on the pulse processing side as one of the misses, that we put a lot of money into pulse processing and we still can't seem to sort that out. Do you think that disincentivizes us to do big things like that, like those superclusters?
Yeah, when we have misses or when we spend hundreds of millions of dollars and don't see results or those businesses go under, I think that is, that's where in a democratic country voters hold politicians to account for those types of things, and ultimately we can have KPIs that the government's looking for and different metrics for measuring this, but ultimately We're in a democratic country where politicians, ultimately it's politics that drives where governments invest funding. And so I don't know if it, ideally the Agriculture Department and cabinet has key indicators and things that they're looking for. And one of them in Canada, I think would be keeping more farms alive, afloat. Nobody likes storeys about farms going bankrupt and going under, that type of thing, on a broad scale. So that would be one that I think politicians would agree with, but ultimately it often comes down to who makes the loudest noise and who has the most volume in Ottawa and in decision makers' worlds that they live in, the bubbles that they live in.
But Kelvin, if the objective was to keep farms going, ag policy has failed in this country for a long time, right? Like, that's one thing that Isn't that one of the objectives?
Like, why else do we have business risk management programmes for agriculture and not for other sectors?
Kelvin, we've been diving deep on BRM for 6 months and we cannot find a good common agreement as to why do we have these programs.
We should start that.
So there you go. Yeah, well, maybe we should. Okay, but also that does sort of bring us back to the objective side and engaging how successful we are in that if the key performance indicator is the number of farms, you're right, we've had consolidation, we have fewer farms. But if the key performance indicator is more successful farms, how do we measure that? And that actually, maybe we are going to talk about that. We've got some StatsCan numbers coming up. But we need to talk about some political stuff. So we're going to take a quick break here and we'll be back with more of RealAg Radio on Rural Radio Channel 147 SiriusXM. Right after this.
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I'm Lyndsey Smith from RealAgriculture.com. Join me Monday nights for The Agronomist, a 1-hour live and interactive show broadcast across YouTube, Facebook, and X. Monday nights at 8 PM Eastern, I host expert agronomists from all over the country to give you answers to some of the toughest agronomic questions. Join us live or catch the replay Tuesday morning. That's The Agronomist with me, Lyndsey Smith, Monday nights live at 8:00 PM Eastern.
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Welcome back to RealAg Radio here on Rural Radio, Channel 147 SiriusXM. I am your host Lyndsey Smith. It is Friday, May 29th. Yeah, it's June on Monday, everybody. I hope you're ready. We've got the issues panel, Andrew Campbell, Kelvin Heppner, Tyler McCann joining me here. Kelvin, I'll start with you on this one. We did promise we'd have some political talk. Lots of things happened this week, including we did get word of Mexico and the US, they've rolled out a couple dates for their bilateral talks. Let's start with that news and then I'll ask, where's Canada?
That's a good question. The bilateral talks started yesterday in Mexico City as an American delegation led by the Deputy US Trade Representative went down to Mexico City. Talks happened yesterday and today. They say the main focus this week was going to be on economic security and rules of origin for industrial goods. So part of this economic security discussion has to do with tariffs and establishing Fortress North America, Mexico and Canada agreeing to the U.S.'s terms in terms of having restrictions on imports from mainly from China. They've also scheduled a second bilateral round in Washington in the middle of June that will focus on agricultural issues. And then there's a third bilateral round that's been scheduled between the U.S. and Mexico in Mexico City in the middle of July, which tells you that they're not expecting to reach a deal and have a full renewal potentially by that July 1st timeline. Canada is not participating in these bilateral negotiations, obviously, but Dominic LeBlanc's office, that's— he's the Canada-U.S. Minister, is downplaying this, saying this is normal diplomatic engagement between the U.S. and Mexico. We do know that Minister LeBlanc spoke with U.S. Trade Representative Ambassador Jameson Greer as recently as Monday, and there are reports that he is headed to Washington again this coming week. So there is engagement happening. It's just maybe not as much at the formal level as what's happening between the U.S. and Mexico. And I don't know whether this is moving into more my opinion on this. I would say that I would, I'm not sure that this is worth being concerned about from Canada's perspective. The U.S. and Mexico have some bigger issues to work through. Canada can sit on the sidelines and wait. LeBlanc's office says that the Canadian team is fully prepared for the formal review process, the trilateral review process, to begin, but it appears that that's up to the Americans to say when they want to launch that, that joint review. And so I don't— in the meantime, I'm not sure that other than in the, the auto and steel sectors, some of the sectors that are really feeling the heat from the US tariffs. I'm not sure that slow playing this, and we've talked about this before, dragging the puck, is a bad strategy for— or is— I'm not convinced it's a bad strategy for Canada.
Tyler, I mean, you see this, are we, to Calvin's point, are we nervous that, you know, we're not necessarily sending out press releases about meetings that we're having, or do we feel that we're We're in a good spot. We'll be part of the talks when we need to be.
I keep coming back to my starting point on this is we will know whether or not strategies were the right strategies 5 or 10 years from now. And at a certain point in time, governments are making decisions today. I think Kelvin made a really good point that we often don't appreciate in the Canadian context. The issues between Canada or the US and Mexico are different. When you talk about rules of origins, on autos and those auto plants and all of those dynamics that are playing out. It is very, very different than what that dynamic looks like in the Canadian context where often I think the Canadian issues are more political issues. One of the comments that was made this week by one of the politicians in Canada was that the Prime Minister and the President keep talking regularly. It does sound like there is engagement, and I think that what matters is that political engagement creating the right conditions for the negotiations to get to the right place at the end of the day whenever that time comes. Certainly it seems like the Prime Minister was making an effort on that this week when he talked about how a strong Canada can help make America great again, and I think that that's part of kind of the Prime Minister doing what he needs to do to create the right political conditions that are there.
Imagine the hat that says, "Canada strong equals make America great again." Who would have thought that would be a great slogan?
Yeah, it's all about the merch, right? That's what we do. It's very American. Now, okay, so on that point, Andrew, We did have Prime Minister Trudeau was in New York this week, made a big speech and discussion, and where that point came out, and we did see the US Ambassador Hoekstra say that that was the right line, that that was the way to look at this, that building up a strong Canada to support the US was a winning strategy. What do you think? Can we sort of thread that needle?
Well, I think we already really are threading that needle just based on that comment, because the Ambassador Hoekstra He has also pointed out many things he has not appreciated hearing from Canadian folks over the last number of months. So for him to come out and say this is actually a really good point, it's a strong point coming from the Prime Minister, I think is actually a good sign and kind of goes to Kelvin's point earlier that says, you know, the idea that, you know, whether it's riding the puck or just kind of taking it a little easier, letting those issues that the US and Mexico are dealing with first play out before we just try to introduce ourselves into the conversation where we don't necessarily need to be. It is probably playing out okay, and it is one of those situations of, you know, letting those, you know, build a bit of a dynamic between those countries. We are clearly continuing to, you know, kind of sit in the background with some of those conversations, even if they aren't as formal. So I don't think we're missing from any of those, but I— You know, I really do, when you see a message like that from Ambassador Hoekstra, it is, it's, I think it's heading down the right track.
I will say, the part that I can't get over, but I need to, and this is, I think this is the greater point, is that we need to take the emotion out of it, right? Although Hoekstra likes to point out that he can't understand why Canada would ever be offended in any way, shape, or form, by what the US has done, and so let's not be offended. It does appear to me though that the alcohol bans in the US have been— I really did not think that they were going to cause any real reaction, anything like that, but they have. And so I think what I take from Hoekstra's piece is exactly that of if Canada frames Or if Carney frames, you know, these trips he takes overseas and these trade deals as the US is being, you know, a jerk and so we have to do this, that doesn't work. But if he says, we're building a strong Canada and we support the US as a partner and leaves out the whole, you know, tit-for-tat thing, we seem to do okay. And so we do sort of need to park our emotion at the door. Tyler, what say you?
I think that the, That is all happening, but at the same time this week, the Prime Minister announced that our surveillance planes that we're going to buy are going to come from Sweden, right? And so that's right, I think that there was an expectation. These aren't the jets, but these are kind of another military investment that we could have gone with the U.S. plane. We're going with a European plane instead. And so I think that that dynamic and try to kind of find that right balance of, yes, we want to make America great again, to use the Prime Minister's words, but we also want to make Canada strong, and you see some of these choices and how the Prime Minister's kind of walking that line. I think that that speaks to this, a bit of, yeah, try to thread the needle of how do we make sure we don't alienate the United States, how do we make sure we've got the right conditions, given how absolutely critical the relationship with the United States is to the ongoing success of this country, but at the same time, looking for the opportunities to diversify our reliance from the US away. And so I think, I think we'll see where we end up actually on fighter jets. It seems to be the more controversial military plane, but I thought it was interesting to see on one hand this week the PM, the government moving away from the US military complex, and on the other hand the, the PM doubling down on the relationship with the US and it being so well received by the ambassador.
LNG deal with Germany would be another example of, uh, diversification too.
Yeah, can we just stick with that for a minute because this week was surprising in a lot of ways, not the least of which exactly that was our NFU and the Conservatives. We also had, you know, this LNG deal which I believe Trudeau's quote was, "There is no business case." Funny how that changes in a couple years. And on that same day we also had former Environment Minister or the day after, I guess, officially announced. This is one of those like worst-kept secrets, which was quite interesting to watch the news the night before, before it was formally announced that Stephen Guilbeault has, will step away from politics, will resign his seat. Tyler, your thoughts on it? I mean, just quickly, I think, does this really reflect very poorly on this government or is this really a, you know, he made his he made the Environment Minister, former Environment Minister, made it known he was no longer supportive of this government.
Justin Trudeau probably thinks it reflects badly on the government. I'm not sure the average Canadian thinks it reflects very badly on the government. I think the average Canadian is probably pretty happy that we've got a more pragmatic Prime Minister that's making deals and doing business and using safe, reliable, sustainable Canadian natural gas to meet the needs of Europe, right? I mean, it was mind-boggling to hear Canada say No Europe, you're on your own a couple of years ago. It's nice Canada saying not only are we going to pursue the business opportunity, we're going to embrace our strategic position that we have as an energy superpower. So I think this is good unless you're probably in the Justin Trudeau camp of the Liberal Party. And I'm not sure how much that—
Yeah, yeah. Well, I was going to say, does this— we know that there is a part of the Liberal the Liberal caucus or Liberal Party, I guess, and the MPs that have more of that environmentalist bent, and Stephen Guilbeault was a main one of those. This is a very bizarre Parliament where we've had floor crossers and whatever. Do you think we will see other MPs resign over something like this or that environmental faction get noisier?
I have my doubts they'll get a lot noisier. At least, you know, we had heard about, you know, kind of an anonymous letter getting sent, you know, to the Prime Minister, but note anonymous as a very key point to that, because I think it is one of the challenges of those MPs that maybe aren't satisfied with what the Prime Minister and cabinet is doing today, have to kind of weigh that, is are they going to be as effective as they are if they are outside? So whether they, you know, cross the floor to somebody like the NDP, whether they resign, you know, do those types of things, they really have to weigh, well, can I 'Can I actually still deliver a message?' You know, 'Can I actually still deliver to my constituents outside of the tent?' I think that probably is more challenging, and it's kind of been proven in a few cases, you know, that if you're inside, you know, that there is some benefits being there. So it's one of those where are— is the conversation over in terms of, you know, the balance between, you know, building some of these projects and finding places for this energy to go versus the environmental, no, we're still going to continue to do it, and I think there's lots, you know, in the media world that will continue to push that conversation. However, I don't really think there's going to be a ton. It's not necessarily a threat to the government, I think, that they're going to become so noisy that it's going to end where the Prime Minister clearly is taking this.
I think there might be implications though in more Tyler's part of the country, in Quebec politics potentially down the road, but they have time before the next election.
I would not underplay how much the ground is shifting even in Quebec too, right? Like, I think that there is more pragmatism coming across the country. I don't think we can downplay the impact of the US and the world and what it all means. I think that we've seen the support for the PQ start to soften some in Quebec. We've seen more of kind of this more competition amongst either the business wings of the Liberal Party provincially and the CAC government. I think that there's some more common sense prevailing there. Again, I think it all depends on how far these things all go and what this looks like. I think pipeline to the Lower Mainland of BC will be much better received than some very controversial pipeline that goes across Northern British Columbia. I think that that's where you get into— until you actually see what we're talking about, I think all of this could be very abstract. I think that the LNG deal this week is probably very straightforward. It seems like people largely are very supportive of that approach, and I think that that's all very, very low risk. I will say, Lydia, we make a big deal about division in caucuses. This is a very Canadian thing where we don't let members of Parliament in a party have some differences of opinion. You look at— I mean, Britain may be kind of the extreme case where they're all over and they turf Prime Ministers far too regularly. But I don't think it's a bad thing to have kind of a caucus of 175 MPs or whatever the Liberals have now, and they don't all agree on everything. I think that that would be good for the Liberals and the Conservatives if they had a little bit more room to, to breathe on some things like this.
Mm-hmm. Okay. We've gotta leave it there for a moment. We're gonna take a quick break and we'll be back with more RealAg Radio right here on Rural Radio, Channel 147, SiriusXM, right after this.
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Welcome back to RealAg Radio here on Rural Radio Channel 147, SiriusXM, and of course, on all your streaming platforms where you get your audio and YouTube. YouTube, so you get to look at our beautiful faces if you're watching on YouTube. And personally, I like to watch it on YouTube so that you can see everyone's ridiculous faces they make, and then you learn what they really think of the questions I ask. Okay, bringing in the issues panel, we've got Andrew Campbell, Kelvin Heffner, Tyler McCann. Tyler, one of the things we didn't mention right off the top, but there was a webinar this week on biofuels, so that was a partnership webinar that we did. Shaun was on there as well. There is so much to unpack on the biofuel side, but let's start with, from that perspective, what were some of your big takeaways from that discussion?
I think first, in general, this is my view on biofuels most days, we don't talk enough about it in Canada. And so I think that we appreciated the opportunity, appreciated the support of BEASF, who sponsored the webinar that we put on. We appreciate the opportunity to talk about it And I think you get into this world where there's kind of two different sets of issues. One, there was kind of this political issue that exists around, do governments, do political parties in Canada support, and do farmers support biofuels mandates? And that has not been clear over the last couple of years. And I think that that continues to be this undercurrent around all of this around, does Canada have that long-term commitment to a growth policy around biofuels? On the other hand, there is this very nuanced argument around the clean fuels regulations that exist today and some amendments that people are looking forward this summer, and very different dynamics that play out in the ethanol market and that play out in the renewable diesel market. And we live in this world where on one hand we've got this competition from the United States, especially on the ethanol side, that could effectively swamp the Canadian ethanol market, and on the other hand this kind of real need for more investment on the renewable diesel side. And the market dynamics are different. The solutions that they need are different, and I think that the hope and optimism that we'll see some good amendments come from government this summer is a big piece of it. But I think that there's the sense that those amendments are probably baked in, and it's just a matter of seeing what they look like. And the question gets to be, okay, hopefully they send some of the right signals. Hopefully they keep Canadian producers on a level playing field with the United States, where we see significantly higher subsidies and regulatory interventions that we don't see the same in the Canadian context. And hopefully that builds a floor to talk about what does long-term demand growth look like as well.
Andrew, as an Ontario farmer, you know, really the biofuel discussion is an ethanol discussion. But nationally, of course, it's ethanol and renewable diesel. It's a much broader discussion. And at times these two things seem to be, at least in the CFR and these sorts of things, at odds with each other. So from your perspective I mean, the risk is, or the concern is, a lot of US ethanol potentially coming in. So how do you sort of view where Canada needs to go on this? Have we fallen short on the ethanol side?
Yes, would be the easy answer, because it's one of those things where I think that there's just this recognition, and it is kind of a conversation that almost fits with, you know, kind of investment in agriculture from folks outside of the industry overall, where it's kind of this, like, it's this huge potential potential market, this huge potential opportunity in Canada. We know the demand is there. Fuel demand is, you know, by the time you look at what those numbers could be to actually fill that going forward, um, you know, could have really tremendous impact, um, for farmers across the country. And that's where I think that, you know, at the end of the day, it is going to be filled from somewhere. And the challenge we have is that if we don't take that step forward and don't look at that investment— that investment is happening in the It is moving forward in the United States through a whole bunch of, you know, kind of tools that Tyler talks about. But honestly, bigger than that is just it's part of the conversation in rural America is how renewable fuels are going to be part of, you know, kind of the long-term demand strategy, fuel strategy, all of those. And we just do not have those conversations. So I think what we really need to do in Canada is beyond just looking at some of the regulatory side of things in terms of, you know, of, you know, tax credits or whatever it is, is find those voices that are in government that are actually going to back it and say, you know what, this is really the opportunity and are actually going to push these changes. That's what I'm really looking for is who are those people going to be and how do we get them to step forward and actually make this a priority.
So, Calvin, that same sort of discussion happens for Western Canada as well when it comes to canola and biodiesel. A renewable diesel. We have potentially at times pushback from within the agriculture or the farming sector at least to say that, you know, this isn't necessarily what we want. We've talked about a lot on this show, but how do we sort of navigate the potential of renewable diesel with the pushback from those who are actually growing the crop?
Well, I think we first have to be fully informed and aware of how significant this demand is in our market, how much of our canola is already going into the renewable diesel market. I do think Tyler and Lyndsey, you both alluded to this, we talk about biofuels as kind of this big umbrella, but I'm wondering if we should already, we need to move the conversation separately already into ethanol and renewable diesel because it is such a different story. The US policies are so far quite beneficial for canola in Western Canada on the renewable diesel side of things in terms of incentivizing demand for crops grown in Western Canada and the Northern Plains, whereas the US policies on the ethanol side of things are detrimental to Ontario corn and ethanol production. So that's where, to me, it's two very different storeys that maybe we need to differentiate more in terms of the discussion that when we talk about biofuels, it's not just biofuels as a whole, it's renewable diesel on one side because it's so different. But yeah, to me, We need to be aware of it. We need to, like, I think the concern about a mandated demand is always going to be there, but at the same time, we also need to realise that that's the world we live in where every country right now is trying to be protectionist and trying to set up walls to protect their domestic producers. And so, if Canada wants to compete, there needs to be some, we need to, I guess, play that game too. And that's where I think a lot of Western Canadian farmers have a difficult time with it because We're used to thinking that we are free— in a free market where it's open markets and open trade and all of that, but that's not the world we live in when we look at policies coming from our largest customers, whether it's the US or whether it's Mexico or China or all of our— everybody's moving in a protectionist direction right now. And if we want to, I think, look at biofuels, again, to use this— to go back to the umbrella term as as a farm support type program. That's how US politicians view it. They view the RFS and these tax policies as addressing their concerns about maintaining the rural vote. We don't have the same clout in rural parts of Canada, and so we don't— I think that's a big reason why we don't have more discussion about biofuels in Canada, to go to Tyler's initial point.
Well, and I think another level to this too, or another layer, is that a corn farmer and a soybean grower in the States are the same person. In Canada, a canola grower and a corn grower are often different and even regionally are different, right? Like so much of our corn, although I know on the grand scheme of things Canada doesn't grow a lot of corn and we use other crops for ethanol, but it does end up being almost a west-east issue. Not entirely, obviously Western Canada has ethanol plants and we use other, but I mean we know that we have corn that goes into ethanol plants in the west We know that we have other crops that do too, but it does separate more into two groups versus the same person on both sides. So it also is more complicated, I think, on the Canadian side. But to your point, Calvin, I think it's an important one, is that whether Western Canadian growers want to be a part of a biofuel market or not, they don't really have a choice because the canola market is a biofuel market. For North America. So then it becomes, how do we choose, how do we want to participate then, right? Like, what does that look like? This also dovetails into, Kelvin, we got some StatsCan figures this week and there's some more digging to do because you did notice a couple different things, but what storey did we get from StatsCan as far as, I believe this is farm income.
Yeah, this is farm cash receipts for 2025. They released their big report on farm income from last year this week, and it showed that despite record high yields in a lot of our major crops that we grow in Canada, and of course record high prices in the livestock sector, overall farm net income actually was down 0.3% in 2025 from the year before. Following a 33% decline the year before, which that's one of the interesting storeys here. They've revised last year's farm income number by more than $1 billion or 11% lower. If you go back to last year's report, they said farm income was down 26% from the year before. Now they've changed it to 33%. That's one thing we're digging into, why StatsCan has come to the realisation that 2024 was a much tougher year than initially reported. It's a tale of 2 different storeys here, of course, with the livestock and crop sectors facing different scenarios. Livestock driving cash receipts in a big way with a record high increase, or we know we've talked about this at length, record high prices on cattle. Hog receipts also strongest growth in years. Sheep and lamb, Lyndsey, receipts were up 16% year over year. Supply managed sector receipts grew by a 3.3%, a much lower 3.3%. Then you look at the crop side of things, especially when you look at canola, which was affected by trade restrictions, peas and lentils also affected by trade restrictions with India, down substantially. On the crop side of things, provincially, Saskatchewan and Alberta saw the largest provincial declines in crop receipts. Ontario, B.C., and Quebec actually had pretty significant increases in crop returns on soybeans and fruit and vegetables mainly. Cannabis is also factored into all of these numbers, and so that kind of messes with the numbers a little bit in terms of our perception of farm income. Overall though, expenses, of course we know expenses continue to climb, but the biggest contributor to higher expenses last year, no surprise, a 39% increase in livestock purchase expenses, replacement animals driven by of course record high cattle prices. That's a quick summary of it, but just interesting in this time when there's a lot of discussion with farm profitability to look at the overall farm profitability picture for Canada.
Okay, there's more to talk about on that, but we do have to take a quick break. I did want to, before we hop to our next segment though, you can watch the biofuel webinar, the replay is on RealAgriculture.com, or you can find it on YouTube as well. So go and cheque it out and you can watch it, listen, and let us know what you think. Okay, we're going to take a quick break and we'll be back with more right after this.
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Welcome back to the RealAg Issues panel. We are a talkative bunch today, everybody. I'm your host Lyndsey Smith. I've got Andrew Campbell, Tyler McCann, and Kelvin Heppner joining me as well. We're going to have two very quick rapid-fire segments here because I just did the math and we're running out of time. Of course we will have a bonus for those listening on the podcast feed or on YouTube, so stick around for that as well. But just quickly, Tyler, I'll start with you. This week we did have, and you heard some of it on RealAg Radio this week, the Final Mile podcast, excellent discussion about leading through crisis from the Alberta perspective. Through the BSE crisis, Verlyn Olson and Charlotte McLellan, I always get that wrong, of course, looking back at what it was like to not just, you know, lead through BSE but also XL Foods and so many other things are going on. Tyler, your thoughts on looking back at something like that on the farm leadership side?
You know, I think it really speaks to, these are difficult challenging situations, especially if you go to that early announcement around BSE and Listening to Shirley talk about kind of those challenges in the first days, try to work through things, she said when she was given the first notice of a potential fine, she went home for the weekend and didn't want to talk to anybody about it. I thought that was kind of an interesting thing to go and kind of be in the position of, you know, you know things, but we don't know for sure yet. But, you know, I think that they both touched on it. Shirley really leaned in on this, right, the support of the Premier at the time, the support of the Finance Minister, the kind of power and support that she had as Agriculture Minister, how that changed the work that she did and what she was able to deliver for farmers in Alberta, I thought was really, really telling. I think they both also spoke to kind of the good relationships that they had with their federal counterparts and the efforts that could have— the coming together of around these issues, and I thought that was really quite something. I was in the Minister's office when we went through XL Foods, listening to the former Minister talk about kind of working with kind of the stakeholders and Again, I think we all, when you're on different sides of the issues, we were all on the same team, but dealing with some different pressures, it was interesting to hear kind of his side of the stories, but they're really good reminders, I think, that these things just happen, right, and as much as we like to have stability and predictability, and as much as we're living in this new era of these challenging worlds, there are unfortunately things that come up, and again, we think in the risk context at work, but there's a lot of things out there that could still come up too, and it's good to have of good ministers that are prepared to lead when that time comes.
We talked—
Yeah, go ahead, Calvin.
I was just gonna say, last week we talked about the anniversary of the BSE crisis, and Shaun played a clip of that podcast discussion. I'm curious whether, what you guys think about whether we have the same capacity to rally after a crisis today, given how fragmented our society is, whether we're talking politics or social media or separatism, or there's just— it seems like there's a lot more division, and we don't all read the same sources of information and trust the same sources of information as maybe in 2003, uh, when BSE happened. And whether that handicaps our ability to really rally as a society around the beef sector, as happened after BSE with Canadians across the country holding barbecues and rallies and that type of thing, and I don't know, I may be feeling a bit discouraged or pessimistic about our ability to respond productively to crises today versus then.
So yeah, it's a good point, and Andrew, I want to— we have sort of, at least at a micro level, and maybe quite macro for some, but here in Ontario we have the Alto Rail line is causing a lot of consternation within the rural landscape. There also, in these last two weeks, there was the pushback to DND, potentially expanding on some farmland or land that's— they have— D&D has sites that aren't really being used, but it looks like they want to set up new sites on some D&D land in the south. And to Calvin's point, we don't have the same sort of, you know, 2 or 3 major newspapers all covering it, or your local news covering it, and the communications piece on a lot of this becomes much harder when everyone, you know, you might have one group that only gets news and I use air quotes, through Facebook, and you can't even share links on Facebook. So to Calvin's point, Andrew, what do you think? Are we, are we in a worse spot or a better spot to handle something like a crisis?
I'm going to, as I naturally do, take the more optimistic view that I think we can actually get there. I think one of the challenges that we do have, you know, you mentioned things like the D&D or Alto or things like that, the biggest challenge with that is is as much as they are national projects, their regional impact. And so it's one of those where, you know, depending on where you are, you know, like, you know, Calvin's newspaper in southern Manitoba isn't covering the Alto, you know, high-speed rail. Where I do feel a little more optimism is, you know, we were talking earlier about kind of, you know, alcohol, you know, restrictions in Canada coming up from the US. We haven't had a whole lot of people in the country kind of baulk at that. I think there just is kind of this natural no, we're okay with that because it is much more of the national impact. And I think that was one of the things when you do think back to BSE and talking to people through that was really a case of it was very much felt nationally. And so I think there is still opportunity to do that. Maybe it's not on as many issues as maybe we think it should be, But I think it just comes down to the challenge that, you know, different today than was in 2003, you know, everybody feels busier, they feel more inundated with information, they feel more inundated with kind of issues that are impacting their daily lives, that it really has to almost be the right issue to pull us all together as a country. But I still think we can when those right issues do matter.
Alright, okay, we're going to leave it there. We're going to take a break, be back for our last segment of the day right after this.
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Welcome back to RealAg Radio here on Rural Radio Channel 147 SiriusXM. I am your host for the day, Lyndsey Smith. It is the Friday Issues Panel. Tyler McCann, Kelvin Heppner, Andrew Campbell. Uh, Kevin, I'll go to you first. We have a very quick What are you watching for next week? What's on your radar?
Oh man, it's June already next week, so I guess that means that July 1st deadline is just weeks away now when it comes to Canada-US-Mexico trade talks. See what comes out of those meetings in Mexico City, and of course, Mark Carney. It just seems like all around we're seeing things ramp up in terms of irritants being brought forward and positioning each country trying to— in different stakeholders trying to get leverage ahead of that. So, uh, definitely following that here.
All right, uh, Tyler McCann.
This is maybe a bit more niche, but I'm at an event in Ottawa next week where they're talking about intellectual property protection. There's a panel of us from the ag space. Such a really kind of important and underappreciated issue around if we want to get more investment in the country, we need to do a better job I think often that's really easy except when it comes talking about plant varieties and how we're going to fix that problem and continue to look forward to see where that discussion goes.
That is a sticky one. Okay, and Andrew, what's on your mind for next week?
I think it's one that, you know, a very regional one, as I mentioned earlier in terms of the weather, is I'm very interested to see how quickly can a Southern Ontario crop get put in and how much can it be finalized. I think it's one of those things where, you know, we always do worry about cool conditions and slow progress and are we behind and all of that. I am very interested to see what happens, um, you know, within the next week because, um, myself and the vast majority, um, here in this province I think are going to be having a very busy week catching up on podcasts in the tractor cab.
Absolutely. Okay, we'll leave it there. Uh, thank you to each of you for joining me here on the Issues Panel. For you, uh, for those of you listening, if you've got feedback, you can drop me an email,
[email protected]. Or you can text or call the feedback line 855-776-6147. Have a wonderful weekend, everybody. We'll talk to you on Monday. Check it out, Agronomic Monday, 4:30 Eastern, right here on Rural Radio Channel 147. Cheers, everybody. All right, welcome to the bonus. Thank you, everybody, for downloading podcast, watching on YouTube, all those sorts of fun things. I've got Tyler McCann, Kelvin Heppner, Andrew Campbell joining me here. Uh, Kelvin, what did we not talk about on the show?
I guess a little more on the trade front, Mercosur talks were happening in Toronto this week, and there seemed to be signs around those talks that they're pushing hard for a deal. The Canadian Cattle Association has of course launched a campaign over the last number of weeks, uh, raising concerns about, uh, access of South American beef into Canada. Then at the same time, we also saw India's major senior cabinet ministers in Canada this week with, I believe, the largest business delegation to Canada that India has ever sent. There's renewed talk there about a Canada-India trade deal also being finalised by the end of the year. It seems like there's a high level of aspiration on a couple of other deals that would also diversify Canada's trade South America and India.
The Mercosur one is an interesting one because of course the, the, we have heard a lot from CCA from the cattle side saying we don't want added access into Canada, which is maybe counter to what we usually hear from, from CCA as far as trade goes. So that's interesting. Andrew, switching gears, what storey this week or thing that's going on caught your eye that we didn't talk about? Out on the show?
I'm actually going to go with, um, the same as Kelvin's because I think it's one of those— not necessarily because the talks were happening, I think that's progress. I'm very interested to see, can any of these actually get to the finish line? Because it is one of those things where, you know, we've, we've heard for a very long time about what the potential with India is, and then, you know, certainly, you know, if you're in, um, you know, kind of the, you know, chickpea or pulse or whatever market, then all of a sudden, you know, you, you know how quickly that pendulum swings back the opposite way. Uh, and so it is one of those things where no matter which trade deal it is, in a very protectionist environment, um, you know, to be signing trade deals kind of runs counter to where the global economy seems to be going. So I think it really does go with the talk is great, having the meetings is great, you know, moving forward is, um, you know, great for, you know, certain markets in Canada. I I was optimistic in the last segment. I'm less optimistic in this one to see can we actually get to the finish line in this, and I think we'll see in the next 6 months whether we actually can.
You're right, India is one of those markets where volatility is the norm, right? I mean, tariffs go on, tariffs go off, and, and, but the potential there is, is really huge, but definitely one of the more volatile. Tyler, what did we not talk about?
About this week? Well, first, I feel like I should be the pro-trade voice on the panel this week, Lyndsey. I think that there's too often, too often people, I think, downplay the need for that kind of very vigorous trade agenda, and it is good to see Canada doing this. I think one of the storeys that we haven't talked enough about in Canadian agriculture is that a lot of ways the Europeans are eating our lunch when it comes to an aggressive trade agenda today. They got a trade deal with Mercosur. They are pushing ahead. They did it in a way where a lot of European farmers were not happy with how that deal unfolded, right? And I think that that is this good reminder, and I think sometimes in agriculture we like to think that we should only have trade if it works for us, but the Prime Minister government needs to make decisions about what's in the best interest of this country, and as much as they need to focus on a deal with the United States, a trade agenda in an export-dependent sector, not just agriculture, but the economy as a whole, is absolutely critical. I'm really hopeful that we see progress on that. There may be ag groups that are not happy with the outcome of the deal, but that's what happens with trade deals. That's why it is a deal, because on each side there are winners, and each side there may be those that don't win as much. That's part of what governments have to navigate. The piece that I'm watching for this week, Lyndsey, that we haven't talked about, and hopefully won't be a big deal, but I think I think it seems like we may be getting into another season of labour dispute and unrest. We saw the signal workers at CPKC give their strike notice that that's on the horizon. We see this playing out at the Cargill beef plant in the United States, where that is dragging on, I think, longer than people thought it is too. I think that that is, in all of the talk about trade infrastructure and all of these new investments, there's a great reminder that we need to fix that. The government had been out consulting on some changes that are there. A good reminder that we need to see that kind of get wrapped up so that there's more certainty on the labour relations side and more predictability and to make sure that we don't run into problems again on that. I think that that's something that we don't talk enough about around how do we fix those issues.
I'll be honest, Patrick.
Interesting that they searched for notice the day after the consultations ended. Right, yes. Within days after the consultations ended. Canadian government's consultations on updates to the Labour Code ended.
And I've got to wonder what the strategy is like there amongst the union and the management of, you know, probably not the time for the union to push too hard and be too disruptive as the government's making decisions about how far it's going to go, but heavens, I think it's, you know, we can invest all we want in a new second narrow bridge in Vancouver, but if we don't have kind of reliable labour relations, You know, it's not, the impact is not as great, as positive as could be.
I'll be honest, I was at capacity though, Tyler, and then I completely forgot about the infrastructure labour part, and now here it is again. It's okay, you're not the one actually serving strike notice, so I'll forgive you, it's okay, but it does, it does feel a little though like exactly that, of like so many things going on, we're so focused on these trade deals, we're so focused on all these trade relationships, ultimately though we still have to get things to and from port, and that means that we do have a major issue in this country of not just infrastructure, but of course the people problem of making sure that things can move when they should. So, alright, we're going to leave it there. Thank you all for making time for me and the stand-in hosting gig. It was a lot of fun. I don't think we made fun of Shaun once. And that is a bit sad. So if everybody could work on that for next time, that would be great. Okay, and everyone following along at home, thank you so much. Let us know if we missed a storey we should have covered. You can send it along to me,
[email protected]. And if you have any complaints, send them to Tyler. I think that's— it's usually Shaun, but Tyler's on this week. There you go. Okay.