Canada losing ground in ability to export, analyst warns

Glacier FarmMedia – Foreign customers are losing confidence in Canada’s ability to move its products to market, an expert on international trade told an agricultural conference in Alberta.

“Over the past 12 years, Canada has gone from having the 10th best trade infrastructure globally to currently being ranked — any guesses — 32,” said Carlo Dade, director of the Trade and Investment Centre at the Canada West Foundation.

Why it matters: Canada’s infrastructure for moving goods across the country to export markets has been lagging that of other countries. 

“We have fallen from the top to 32 globally, but you don’t hear much talk about this from the political class in Ottawa, and we also don’t hear it at the local level of people yelling and screaming about the obscenity of dropping 20 points globally.”

Dade spoke at the recent Summer Round-Up conference of Alberta’s Results Driven Agriculture Research (RDAR) funding agency in Calgary. About $2 of every $3 in Canada’s gross domestic product depends on trade, he said.

After the United States dropped from 11 to 13, President Joe Biden and Secretary of Transportation Pete Buttigieg “couldn’t shut up about a two-point drop in the U.S., yet in Canada, we’re not hearing anything about this issue,” said Dade.

It is not simply a matter of Canada changing regulations because “our customers don’t believe that we have a handle on what needs to be built, on how the entire integrated supply and production chain in the country works,” he said.

“We don’t have the ability to know what needs to be built, when it needs to be built, and what the impacts will be across the entire production supply system. And until we get that, the issues that you have in agriculture — moving goods to market, increasing investment — won’t be solved until we solve the larger problem of fixing the system in Canada.”

Although efforts in that direction are being led by organizations including the Canada West Foundation, “we really need voices and involvement from agriculture … and agriculture can either be playing a leading role, or we can have others, especially our friends back east, play the leading role in setting how we will form trade infrastructure for the next generation of economic growth.”

However, Dade cautioned that focusing on solving issues for one sector such as agriculture can have negative ramifications for other goods and assets that move in the system.

“You can solve all the problems that agriculture has and take the rest of the Canadian economy down … so you really have to understand that before we look at solutions to specific bottlenecks or a specific sector, we really have to get a grip on how the entire system works.”

Agriculture has much in common with Alberta’s oil and gas industry, said Hal Kvisle, a member of the Canadian Petroleum Hall of Fame who was born in Innisfail, Alta.

As part of his keynote address at the conference, he drew from his more than 40-year career in oil and gas, utilities and energy. Kvisle is a former president and chief executive officer of TransCanada Corp., now TC Energy Corp.

He said there are only a few places in the world, such as the Middle East’s oilfields or South Africa’s gold and diamond mines, that are fortunate to have industries with assets in the trillions of dollars. They include Alberta’s oilsands sector and Canada’s agriculture industry, he said.

The world’s largest heavy oil production operations are now in Alberta, not in Indonesia or Venezuela, due to efforts by the province’s oil and gas industry to create the world’s largest steam flood operations, he said. He credited the injection technology with turning deposits in Alberta into valuable assets.

Research and technology can also pay dividends for Canadian agriculture, Kvisle said.

“I think today there’s real opportunities in food processing and exports to Asia. We don’t have to invent everything from scratch. Much of this we can build on what’s (worked) in other parts of the world, but we can also lead the world by building research capabilities.”

One “great opportunity” for both agriculture and oil and gas that gets tied up in infrastructure issues is upgrading and value processing, he said. 

It’s one thing to haul raw products such as wheat or barley via rail to large grain export terminals, “but when you start to get into more refined products, more value-added products, it just becomes a whole lot more complicated. And that’s the next thing that we really have got to pay attention to.”

– This article was originally published at The Western Producer.