The Real Success Story of Food Production and Free Markets

by John DePutter, June 18th, 2014
Every now and then, we read something from the UN and other organizations about the hopelessness of feeding the world. We also periodically see complaints about high food prices.

Those of us involved with farming are well aware of the ideas promulgated by some members of the media that population growth will outstrip farmers’ ability to produce food. We recognize too, that millions of people have been moving toward income categories that allow for higher protein diets in developing nations which could mean more demand for the food we produce, especially meat. The past several years have ushered in increased media coverage about these issues, raising questions as to whether farmers will be able to meet the seemingly insatiable demand.

When agricultural commodity prices are high and rising, issues such as this seem to come to the forefront. With them come cries that prices are too high and that too many people cannot afford to pay for what they need.

I would never say we don’t have challenges related to food availability on this earth. We certainly have drastic food shortages in certain areas and people suffer indescribably from them. I don’t have solutions for this beyond offering charitable assistance for well-run organizations involved with helping the victims of such circumstances.

I do believe however, that it is wrong to blame high prices and worse to lobby governments to try to keep prices down.

A true success story for the world – which is not written about often enough – is the wonderful, if not miraculous success of the free markets and the modern day farmers’ capability to produce even-greater food supplies.

The record high prices of the past several years have been a huge economic incentive for farmers and supply companies around the world to respond by producing more.

And produce more, they have. Major crops like wheat, corn, soybeans are setting all-time yield and volume records. In the 2013-14 production cycle, the world’s farmers produced almost 50 million tonnes more wheat, coarse grains and rice than was consumed. Western Canada’s crop yields were off the charts in 2013, a loud and clear testimonial to the ability of this industry to produce in abundance when there is an economic incentive to do so. Indeed, Western Canadians produced so much so that grain became backlogged in the country and rail companies weren’t equipped to move the heavy supply out. Here, as well as in certain other countries, including the US and Brazil, farmers’ ability to expand production has outstripped the growth in the transportation infrastructure to handle the larger crop production.

I think the real story to be told these days is how the free and open markets of the world have functioned well and effectively calling upon farmers and others in the production chain – calling upon them with price incentives – to produce more.

There are certainly issues getting food to the people who need it – political problems, natural disasters, geopolitical instability, and so forth. But for their part, the free markets are functioning well.

Consider this: If you look at the history of Canada and the US and where farmers have come the past 100 years, food production has evolved into one of the greatest success stories, if not THE greatest success story, of our society and business landscape. More food than ever, safer food than ever, the greatest variety ever available, lots for domestic consumption and lots for export… produced, processed and transported within a vibrant and ever-adapting and self-correcting system… a sector that creates jobs and business opportunities for millions of people… think about it! This is deserving of high praise.

We need to remind ourselves and others too, that agriculture and food is not a sector that simply moves money around or re-distributes income and wealth, as is the case with certain other industries. Agriculture and food business creates value, adds value, all along the chain. Farmers start with a seed and from that seed, we ultimately receive food and fibre and energy in various, multiple forms that sustain us and help make our lives better.

People might say the system doesn’t work or isn’t completely fair but I challenge them to come up with a better one. What we have today is effectively working for the betterment of the greater good.

As farmers work busily throughout Canada at this time, sowing seeds and taking care of their fields during this cropping season, think for a moment what their efforts may produce (nature permitting). Think about the various corners of the world to which the fruits of their labour will travel. Think about who might consume the foods these commodities are transformed into, and the many, many ways they’ll be used. It’s really quite amazing.