Canadian AgricultureOctober 23, 2020
An Alberta farmyard on Highway 56. Canada’s agriculture and food industries have changed greatly in the years since world war II. Growth in Canada’s economics, and associated social changes, have altered the way food is produced, processed, handled, sold and consumed. This has contributed to increased productivity from fewer, larger farms, and food processing and distribution firms. Much of the agricultural production and food processing is relatively efficient, with lower costs than in many nations. Normally, Canadians spend less than 10 percent of their total household expenditure on food purchased in grocery stores for home consumption as a result of the combined effects of comparatively high degrees of average income and comparatively inexpensive foods.
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When expenditures on food eaten away from home are added onto home consumed food expenditures, it’s estimated that Canadian food expenditures account for about 14 percent, on average, of total household spending. Liberalization of international trade has also increased productivity in agriculture and has contributed to the international competitiveness of many sub sectors in the market. Consequently, there’s a positive net balance of trade in agri food products between Canada and the rest of the world. Canadian agri food imports include fruits and veggies, beverages and processed foods. A large proportion of Canada’s pork, beef and live animal exports are to the US which, despite some trade tensions, is still Canada’s largest export market and the largest source for Canada’s imports of farm and food products.
Most oilseed and grain exports, that are dominated by canola and wheat, go to other, offshore markets. Japan, China, the European Union and Mexico are major export markets for Canada’s farm products. The composition of Canada’s agricultural production and exports changed slightly in the last decade, reflecting changes in economic conditions and export demand that have led to increased exports of oilseeds and pulses, and less animal and meat exports. A change in US government agricultural policy removed control of wheat exports from the Canadian Wheat Board in August 2012, although agricultural marketing commissions perform a wide range of marketing and regulatory functions on behalf of farmers for some other farm products. Farm Production and Structure – Even though Canadian primary agriculture has grown, it directly accounts for a much smaller share of national production and employment than in earlier years. This shift is the consequence of growth in the Canadian economics and technical change in the market, and is shown in the longstanding, continuous trend towards large, fewer and more specialised farms. That is due to lower costs of production per unit of agricultural production driven by the substitution of capital for labor through use of increasingly sophisticated machinery along with other technology.