Growing Forward: Cultivating Productivity in BC’s Agrifood Supply Chain

March 3, 2016
Kristine St-Laurent

British Columbia’s agrifood sector is comprised of a highly diversified portfolio of industries. The activities operating under the broad “agrifood” umbrella include primary agriculture, aquaculture and other seafood production, a variety of related food processing and manufacturing enterprises, and the retail/wholesale portion of the food supply chain. The combination of $12B in annual revenue (in 2015) from the mix of agrifood-related activities collectively represents a sizeable contribution to the provincial economy. As for employment, the entire agrifood supply chain supports more than 300,000 jobs, although the bulk of these are in the retail/wholesale and food and beverage segments of the sector. Primary agriculture and food processing together account for approximately 55,000 jobs in BC.[1] In comparison to the sharp market cycles experienced by other resource-based industries, the diversity of the agrifood sector establishes a relatively stable foundation which allows the sector to adapt to a changing geographic and economic climate.

BC’s agricultural exports have shown consistent growth over the last decade.[3] Looking ahead, industry analysts expect strong global demand for many Western Canadian agrifood products. BC’s top agrifood exports are salmon, crab, blueberries, baked goods and food preparations for manufacturing.

2014-2015 Export Growth for BC Agrifoods[2]

The biggest foreign consumer market served by BC agrifood exporters is the United States, followed by China and then Japan. Trends such as a growing world population, rising incomes in emerging markets, the need for sustainable sources of protein, and a host of challenges associated with climate change should all serve to boost the demand for many of BC’s agricultural and seafood products over time.

With the diversity of the agrifood sector providing a platform for future growth, BC boasts competitive advantages that—if managed strategically—can enable the province to make further inroads in international markets. BC is favourably positioned geographically and also has strengths in infrastructure, science and related research to help meet the global demand for high quality agrifood products, with a particular focus on the dynamic Asia-Pacific region.

International trade agreements with Europe, Korea and other major Pacific Rim countries have created new market expansion opportunities for Canada. While trade agreements offer a way to facilitate the growth of BC’s agrifood exports, they also bring increased domestic and international competition. Despite the resilience of the local sector, our agrifood industries are at a disadvantage in comparison to some other jurisdictions in terms of economies of scale as well as labour, land and other input costs. Access to workers is a concern for many primary agrifood businesses, as the need for labour tends to vary seasonally and cyclically. Proper succession planning and a policy framework to support the next generation of growers, harvesters and manufacturers also needs to be addressed as the workforce ages.[4] Both productivity and profitability are also impacted by the varying costs of inputs such as energy, water and animal feed, as well as the lower purchasing power reflected in depreciated Canadian dollar.

Government decision-makers can help the agrifood sector reach its potential by designing smart policies to bolster the productivity and competitiveness of BC producers and enhance food security. Agrifood is unlike many other industries because there is an emotional component connecting consumers to their food. Many consumers – both in Canada and abroad – are becoming more mindful of their relationship to food sources and the importance of quality. Globally, demand is rising for sustainable food from suppliers who are able to provide safe and healthy products. It is important to earn and retain the trust of the global market for BC agrifood products and use this source of competitive advantage to support the industry’s future development and growth.

[2] B.C. Agrifood & Seafood Strategic Growth Plan, p. 30.

[4]Profile and Outlook for the BC Agri-Food Industry, Business Council of BC, p. 17

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