An Ove rvie w o f Onta rio Ag ric ulture a nd Fo o d: An - PowerPoint PPT Presentation

An Ove rvie w o f Onta rio Ag ric ulture a nd Fo o d: An Ove rvie w o f Onta rio Ag ric ulture a nd Fo o d: Our Strengths , Our Future Our Strengths , Our Future Mic ha e l To o m bs , Dire c to r, Re s e a rc h a nd Inno va tio n Bra nc h Onta rio Minis try o f Ag ric ulture a nd Fo o d a nd Minis try o f Rura l Affa irs

Pre s e nta tio n Ove rvie w Pre s e nta tio n Ove rvie w  Sector Profile – Ontario  Ontario Agriculture at a Glance  Demographics  Exports  Innovation as a Key Driver to the Success of Ontario’s Agri-Food Sector  Capacity  Value-Added Products and Processes 2

Onta rio a t a Gla nc e Onta rio a t a Gla nc e  1,076,395 sq.km., 14.7% freshwater (lakes/rivers)  Population of over 13.5 million (39% of Canada)  Population over 5.4 million in and around Toronto – fifth largest city in North America  Only 6.0% of land used for farming  Approximately 250,000 people immigrate to Canada every year and about half choose to live in Ontario  55% of the Ontario workforce over 25 years of age has completed post-secondary schooling 3

Onta rio Ag ric ulture a t a Gla nc e Onta rio Ag ric ulture a t a Gla nc e  12.67M acres of farmland in Ontario, with 51,950 census farms managed by nearly 74,840 farm operators. Average farm size is about 244 acres.  In 2012, Ontario’s agri-food industry (farm, food manufacturing, retailing and food services) contributed over $50 billion to the total provincial GDP and sustains over 700,000 jobs  The major livestock commodities produced in Ontario are dairy products, cattle, hogs, and poultry.  The major crops grown in Ontario are grain corn, soybeans, vegetables, and floriculture/nursery crops.  200+ commodities grown in Ontario - diversity unmatched by most jurisdictions  3,000+ establishments across the province  Over $2 billion in capital investment in value- 4 Source: Statistics Canada, Census of Agriculture 2011, added processing in Ontario food, fuel, MNP Report 2012

Onta rio ’s Ag ri-Fo o d S e c to rs a t a Gla nc e Onta rio ’s Ag ri-Fo o d S e c to rs a t a Gla nc e 5

Re g ula te d Ma rke ting S truc ture s Re g ula te d Ma rke ting S truc ture s  Due to concerns about imbalance in market power (large number of relatively small farmers and small number of relatively large processors) regulated marketing systems have been put in place to give farmers the power to work collaboratively  This legal framework is the foundation of the current farm commodity marketing boards and associations  Regulated marketing covers a wide range of collective actions by farmers from marketing arrangements with limited powers (e.g. pork, grain) to supply management systems (dairy and poultry) with extensive powers  Supply management includes production limits, import restrictions, and cost of production pricing. Changes to supply management require both provincial and federal agreement. 6

Curre nt Enviro nm e nt – Prim a ry Ag ric ulture Curre nt Enviro nm e nt – Prim a ry Ag ric ulture  High commodity prices, record net farm income, rising input costs for some sectors and food processing firms, increasing land values and growing net worth but mounting debt levels  Most diverse agriculture sector in Canada  Benefit from business risk management programs and supply management programs and supply management marketing systems that provide stability to farm incomes 7

Curre nt Enviro nm e nt – Ag ri-Fo o d Curre nt Enviro nm e nt – Ag ri-Fo o d  Largest (32%) agriculture and food processing industry in Canada  Largest and most diverse primary agriculture sector in Canada, with 23% of national cash receipts in 2011  Ontario’s food processing sector purchases almost 65% of food produced by Ontario’s farmers  Experienced growth during the recession due to value-added investments 8

2 0 1 1 Onta rio Ag ric ulture De m o g ra phic s 2 0 1 1 Onta rio Ag ric ulture De m o g ra phic s  Size of farms is increasing while the number of farms is decreasing  Output and productivity continue to increase  Farmers are facing increased challenges of managing complex businesses  Average age of farmers continue to rise in line with the general population  Young farmers are more likely to work full-time off the farm 9

% o f Fa rm s a nd Fa rm S a le s by Re ve nue Cla s s , % o f Fa rm s a nd Fa rm S a le s by Re ve nue Cla s s , Onta rio 2 0 1 1 Onta rio 2 0 1 1  The largest farms (over $500,000 in farm sales) or 17% of farms account for about 71% of total sales 10

Onta rio Fa rm Inc o m e Onta rio Fa rm Inc o m e  2011 total net income was $0.88B and estimated at $1.01B in 2012  Program payments have decreased since the record high of $800M in 2005 – payments were $281M for 2011 and are estimated at $383M for 2012 11

Ac c e s s to No rth Am e ric a n Ma rke ts Ac c e s s to No rth Am e ric a n Ma rke ts Key benefits of area : – Just-in-time delivery everyday reality – Industrial heartland of North America – 52% USA GDP within 10 hours trucking – Secure raw materials through excellent logistics options – Availability of highly skilled labour and personnel – Excellent cooperation within region between companies, government and labour – Over 50% of Ontario’s food processors are clustered in the GTA – In 2011, Ontario’s agri-food exports increased by 5.4 percent to $9.9 billion compared to 2010, representing 22% of Canadian total agri-food exports. 12

Onta rio ’s La rg e s t Ag ri-Fo o d Ex po rt De s tina tio ns Onta rio ’s La rg e s t Ag ri-Fo o d Ex po rt De s tina tio ns 79% 1% 6% 1% 2% 3% 8% o Despite increased trade with EU countries Ontario needs further diversification Source: Statistics Section, OMAFRA 13

Onta rio Ag ri-fo o d Ex po rts , 2 0 0 1 to 2 0 1 1 Onta rio Ag ri-fo o d Ex po rts , 2 0 0 1 to 2 0 1 1 ($ m illio n) ($ m illio n) 12,000 10,000 8,000 6,750 6,397 6,555 6,000 6,340 6,351 6,642 6,440 6,421 6,287 6,318 5,789 4,000 1,968 2,000 2,089 1,755 1,703 1,723 1,474 1,605 1,677 1,682 1,511 1,452 1,191 1,091 863 810 657 456 436 561 598 638 571 0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Bulk Intermediate Consumer-Oriented e.g. Wheat Flour Bread Source: OMAFRA’s International Trade Database 14 adapted from Statistics Canada

Innovation as a Key Driver to the Success of Ontario’s Agri-food Sector 15

Onta rio ’s Co m pe titive Adva nta g e Onta rio ’s Co m pe titive Adva nta g e  High quality farmland  Relative abundant supply of freshwater  Highly skilled and knowledgeable farmers and processors  Good reputation for food safety, animal health, and environmental stewardship  Access to large markets (135M consumers within a 1-day cargo drive)  An educated, skilled, and diverse workforce  Long-term investment in research and innovation 16

Onta rio ’s Ag ric ultura l Re s e a rc h Ca pa c ity Onta rio ’s Ag ric ultura l Re s e a rc h Ca pa c ity 17

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Re s e a rc h a nd Co m m e rc ia liza tio n Ca pa c ity Re s e a rc h a nd Co m m e rc ia liza tio n Ca pa c ity Economic, Environmental Discovery and Technology & Competitiveness, Business Growing and and Social Productivity, Knowledge Product Implementing Acceleration Challenges Transfer Development Prosperity in the Market and Research Opportunities Tech Transfer via OMAFRA Branches/ Programs OMAFRA – U of G Agreement, New Directions, Food Safety, Environmental Sustainability Directed research programs Knowledge Translation and Transfer (KTT) Agriculture Technology Commercialization Centres (ATCC), Soy 20/20, BioEnterprise, Ontario Agri-Food Technologies Catalyst Centre – Proof of Principle Fund Farm Innovation Program Premier’s Award for Agri-food Innovation Vineland Research and Innovation Centre Livestock Research and Innovation Centre 19

The Va lue o f Inno va tio n The Va lue o f Inno va tio n  Ontario’s competitive edge is value-added products and processes  Need to transform the industry by shifting the focus of innovation to value- add  Move research towards commercialization and push the industry forward  Proven success through research and innovation shows that innovation pays 20

Re turns fro m Ma rke t-Drive n Re turns fro m Ma rke t-Drive n Re s e a rc h a nd Inno va tio n Re s e a rc h a nd Inno va tio n Omega-3 Enriched Eggs:  Today, it accounts for 5% of Canada’s egg market and 4% in the US  Translates to $375M/year in North America alone Soybean Market in Ontario:  Could not grow significant amounts in Ontario as recent as the 1970’s  Now a $650M/year Ontario market Canola  Testament to success through market- driven research  Contributes $13B to Canada’s economy annually 21