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Keeping Us Fed

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Riverwood Photography

It’s difficult to overstate just how essential Alberta’s farmers are. Year in and year out, through variable weather, economic and political conditions, they provide the food that Albertans, Canadians, the world, needs. From oilseeds and grains, to beef, poultry, hogs and other animals, from dairy and milk, to vegetables, fruits and tree nuts, Alberta’s farmers – numbering approximately 120,000 – are the often unseen faces and hands that keep our food supply operating. Without them, we’d starve.

A look at the numbers underscores their import: agriculture is the province’s second largest sector by value, with nearly $14 billion in foreign sales in 2021; agri-food contributed $7.9 billion to Alberta’s GDP in 2021; the number of farms in Alberta is increasing; and the province has the second largest total farm area in the country (behind Saskatchewan). Notably, Alberta is one of the few places in the world that produces more food than it consumes.

The latter point is particularly salient considering the global population is expected to grow by another 2 billion people by mid-century, with estimates suggesting we’ll have to increase food production by 70 per cent by 2050 to meet this demand.

All this is to say that Alberta farmers are very, very essential. And poised to become even more so as the world continues to grow.

Yet they find themselves the unwitting targets of a federal government intent on tackling climate change at all costs, including their livelihoods. Arbitrary caps on fertilizer emissions (a national target to reduce GHG emissions from fertilizer application by 30 per cent below 2020 levels by 2030), the so-called Just Transition (the plan to transform Canada to a low-carbon future) and an ever-increasing federal carbon tax are federal policies with the potential to harm Alberta farmers.

“Our members are very worried about the direction of some of these announcements and the possible policies that will follow,” says Scott Bolton, president and CEO of UFA Co-operative Limited says candidly. “And it’s not that we disagree with the proposition of doing more with less. That’s precisely what we’re very good at doing; we’re all about being more efficient, reducing our costs and doing more with less. But the challenge is that these announcements – for example the federal government’s pledge to reduce fertilizer emissions by 30 per cent – were announced without any consultation with the people who will have to deliver on that pledge. There was no scientific evidence provided as to how these targets were determined.”

Bolton notes it’s not the goal (tackling climate change) that Alberta’s farmers and ranchers have an issue with, but rather it’s the lack of consultation and scientific backing behind these announcements. “The problem is there isn’t enough detail,” he continues. “It’s difficult to quantify what the impact will be. But frankly speaking, we won’t be able to produce the amount of food we do today with 30 per cent less fertilizer used, without significant advances in technology and application approaches.”

“And there is a real concern that this will increase food prices and may cause some farmers to be uneconomic,” Bolton continues. “That could cost jobs in rural communities and is the exact opposite of what we want to achieve.”

In addition to the fertilizer cap, the so-called Just Transition is expected to affect approximately 292,000 agriculture jobs in Canada. The nature of this effect is unclear.

“Another major impact will be on the global food system,” Bolton says. “Many parts of the developing world are importers of our food. We’re already seeing, with the invasion of Ukraine, how the cost of food and commodity prices have gone up, particularly staples like wheat. Further increases will put the most vulnerable at risk. These are the consequences if we’re not careful.”

The federal carbon tax is also set to increase again on April 1, adding to farmers’ expense sheets. “It’s an additional tax, an additional cost of doing business,” Bolton says. “And in challenging times, increasing costs are problematic. So it is a big concern in the agriculture industry.”

These challenging times include sky-high inflation, supply chains still recovering from the pandemic, and fears of a recession looming.

Luckily, Alberta’s farmers enjoyed a good year last year, as did UFA. “We’ll be reporting record results for the co-operative for the year 2022,” Bolton reports. “In general, Alberta farmers – specifically grain farmers – did pretty well last year too. The 2022 crop was a good one. Yields and quality were good. And prices are high. Overall a good year.”

Founded in 1909, UFA has grown alongside the industry it serves, and today has several successful and growing business divisions. Its agricultural division comprises a network of 34 farm-ranch stores located in rural communities. These stores stock everything from gloves and coveralls to hardware items, gates, fence posts, fertilizer and seed, among many other items. “They are full-service agricultural one-stop shops,” Bolton says.

UFA’s fuel business – its largest division – includes 115 sites across Western Canada (predominately in Alberta, with some in Saskatchewan and northeast B.C.). These are typically cardlock fuel stations, and many include bulk fuel facilities as well. “We can deliver fuel right to the farmer or other industries,” Bolton explains. “Or they can fill up right at our site. We are quite a significant supplier of diesel fuel and gasoline to rural communities.” UFA also sells lubricants and other transportation related products at these locations.

A complimentary business to the agriculture division is UFA’s construction business, which is focused on farm construction projects like sheds and barns. “We sell the raw material if you want to build it yourself, or we’ll build it for you,” Bolton says.

Additional business divisions include a livestock division focused on the feed lot sector, and a division which provides maintenance support to the cardlock facilities themselves.

With the financial capacity to invest for growth, Bolton and his team are looking to grow UFA’s business geographically, particularly into Saskatchewan and Manitoba. “Our neighbours to the east are on a roll and have invested in agriculture as a province,” he notes. “And we think we can be part of it with an offer that will be well received.”

A new store in Red Deer is also something to celebrate. “It’s going to be in Gasoline Alley,” Bolton reveals. “Great access of Highway 2. We’ve acquired the land and will build a full service farm-ranch store and cardlock, with a drive-through bay for some larger product offerings. A big yard and modern store with all the bells and whistles. We hope to have it open in 2024.”

The other area primed for growth is the digital realm. “We are expanding our e-commerce offering so our members can buy a number of products from a number of key suppliers that we don’t normally carry in our stores, online,” Bolton says. “They can then pick them up at our stores. We’re quite excited about this phase of our digital expansion.”

With a little over 1,100 employees, UFA provides particular benefits to its members. First, it stocks the products and delvers the services its members need. “We have a complete offer of product that you can’t find anywhere else but UFA,” Bolton notes. “And we make sure we’re competitively priced.” Second, UFA employs a lot of rural Albertans. Third, as a for-profit business, the profit is returned into the community because members own the business.

“At the end of the year we pay a portion of our profit back to our membership,” Bolton says.

Closely connected to the communities in which it operates, UFA, through its Rural Communities Foundation, provides support to local community initiatives that would otherwise have trouble finding funding, for example, 4H, Ag for Life and other local, lesser-known causes.

“Ultimately we’re a grassroots organization,” Bolton notes. “So that’s where we focus our efforts, at the community level. We’re one member-one vote, so it stands to reason that our community investment is in a similar vein.”

Originally from a small town outside Edmonton, Bolton obtained his chartered accountancy designation from the University of Alberta before joining Pricewaterhouse as a young accountant. He worked in Toronto and Europe before landing in Calgary. He became a partner and eventually PWC’s energy practice leader. A desire to work in industry led him to the position of CFO at UFA in 2013. He became CEO in 2019.

The married father of four boys (including one with developmental disabilities) has a personal passion for the special needs community. He sits on the board of Calgary Quest School and is involved with organizations such as Inclusion Alberta.

He is also passionate about the agriculture industry, and points to the Business Council of Alberta’s recent publication, Define the Decade, which lists agriculture as the first pillar, as evidence of its importance to the province. “Agriculture is really under-recognized and it will only continue to grow,” he points out. “Part of the role of a co-operative is to be an advocate for the membership and the industry. Our organization tries promote the opportunities in agriculture to the government.”

From the provincial government, he continues, farmers want agriculture treated strategically, given the enormous opportunity for growth and for creating economic prosperity for all Albertans: “It’s very important for the provincial government to recognize that and provide the investment and attention to the industry that is warranted. I think we’re hearing good things on that from the provincial government, to be fair.”

Farmers, Bolton adds, would like to be at the table with the federal government when it’s making policy, to be able to provide their own fact and science-based policy.

With the potential to feed a growing world, Alberta’s farmers and UFA have much to look forward to. They have the land, the tools, the experience and the skill to produce the food our growing world needs. The federal government may be their only obstacle to success.

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