By the time harvest ends this season, the Keystone Agricultural Producers (KAP) estimate Manitoba producers will have paid almost $1.7 million in carbon tax related to the cost of drying the 2019 corn crop.
“We are firm in our position that there needs to be an exemption for farmers under the carbon tax framework for all the costs associated with drying all grain, as well as for heating barns and farm buildings,” says KAP president Bill Campbell. “Now that Manitoba falls under the federal backstop, farmers are left paying prices that, as price-takers in the global economy, cannot be passed along.”
After the latest federal, provincial, and territorial agriculture ministers meeting last month, KAP took to the fields and worked with farmers to compile data to show the need for an exemption under the federal backstop. This came at the request of federal Agriculture Minister Marie-Claude Bibeau and Manitoba Minister of Agriculture and Resource Development, Blaine Pedersen
According to a news release, initial data shows that the average producer paid $3.69 per acre in carbon tax on grain drying (primarily corn), including propane and natural gas. That means that almost $1.7 million left the provincial economy this year from corn production alone.
KAP says a typical farmer in this province growing 500 acres of corn spent approximately $14,145 on fuel for drying, while the carbon tax added $1,722 to that fuel bill. Wet conditions this harvest meant that other grain had to be dried as well. Significant and atypical rates of precipitation during the 2019 harvest season forced many farmers to dry grains that may not have been dried otherwise.
“The carbon tax on grain drying not only impacts our profitability as farmers but our competitiveness in a world market,” says Manitoba Corn Growers Association president, Dennis Thiessen.
“If we look to corn farmers in the northern United States, they are paying less for their drying costs and on top of that don’t pay a carbon tax. That corn comes into Manitoba, making Manitoba farmers uncompetitive. This is completely unacceptable, impacts Manitoba farmer’s profitability and the federal government needs to be aware of this.”
KAP will be requesting meetings with federal ministers and federal opposition MPs as part of the annual Canadian Federation of Agriculture annual general meeting held next month to discuss its findings.