Government Creates Challenges for Ag Sector

EUBAI - Apr 19/12 - SNS -- Every year the agriculture industry seems to face a new challenge created by government. Country after country has its own phytosanitary rules, maximum residues limits (MRL) for herbicides and pesticides, individual tolerances for the presence of weed seeds or material from genetically modified (GM) crops, and their own approaches supporting local farmers.

Layered on this are political decisions affected everything from a country's long term financial health to the ability of buyers to obtain foreign currency to pay for imports and the ability of exporters to receive cash from a country. We are watching these issues play out in the Euro-zone, Syria, Iran, North Korea, and elsewhere.

Broad policy changes in some countries could have a profound, long term impact on how many pulses are grown and the price at which production can be sustained.

Canada's decision to give the farmers the choice of selling wheat, durum and malting barley through the Canadian Wheat Board (CWB) or directly to exporters changes the competitive environment in that country.

Competition for land use is likely to increase as wheat, durum, and malting barley become cash crops. Pulse markets have tended to see canola as a competitor for land use, while seeing grains as just another crop in the rotation. That will change because farmers can now take advantage of the same kinds of new crop pricing and delivery opportunities as they do with canola.