The federal carbon tax has added to the financial burden a “harvest from hell” has put on farmers, says a grain growers representative.
“The 2019 harvest season has put undue burden on farmers’ livelihoods, and every part of the country has been hit hard,” says Olds-area farmer and Grain Growers of Canada chair Jeff Nielsen.
“Beyond just the crop left in the field, farmers have faced major grain drying expenses, courtesy of the federal carbon tax, to ensure at least some crops make it to market.”
The new federal carbon levy started at $20 per tonne, increasing to $30 per tonne in April, and $50 per tonne by 2022.
Nielsen’s organization is calling on the federal government to reimburse the money farmers are paying out in carbon taxes on fuel, including the large amounts of propane used for drying crops.
“Our federal government must recognize that farmers should not be faced with an additional tax burden that reduces their competitiveness in the global marketplace.”
Carbon tax relief is not the long-term solution, Nielsen said. Exempting all fuels used in farming from taxes would provide more permanent support.
“This will avoid the need for any relief measures after events like last year’s harvest,” he said.
Farming contributes to environmental sustainability, because crops sequester carbon, which contributes to greenhouse gases. Improving soil health, fertilizer and water use also contributes to a better environment, he said.
Back to back years of early snowfalls, just when farmers hoped to get their combines out in the fields, is among the challenges that have hit the farming industry in recent years.
Nielsen said he had to leave about 15 per cent of his crop in the field because of the weather, and many other farmers fared much worse. Some only got a half to a quarter of their crop off the land.
That thins the vital cash flow needed to dry crops, pay off the previous year’s input costs and have the money on hand to pay for next year’s fertilizer, weed treatments and other farming costs, he said.
Alberta farmers were spared carbon tax costs last year after the new United Conservative government did away with the NDP-imposed tax. However, the federal carbon tax kicked in on Jan. 1.
That new cost comes on top of trade challenges that have hit the agricultural industry hard. China’s ban on canola has received a lot of attention, but before that, India and Italy had rolled out import restrictions, despite existing trade deals.
In 2018, farm net income was down 45 per cent from the previous year, and the trend has only worsened, Nielsen said.