P.E.I. Federation of Agriculture calls $5B pledge for agriculture investment 'a huge step'

The P.E.I. Federation of Agriculture is welcoming an announcement by a federal Crown corporation that says more than 20 private investment groups are ready to invest $5 billion in Canadian agriculture and food innovation by 2030.

This is in addition to a previous commitment made by Farm Credit Canada's investment branch, FCC Capital, to invest $2 billion by the same deadline.

"It's very promising," said Donald Killorn, executive director of the P.E.I. Federation of Agriculture.

"Canada is last amongst the top seven economies in the world in agriculture research and development spending right now … so capital is hugely needed."

A Farm Credit Canada press release said the money would be spent on "innovative Canadian businesses, construction and project finance opportunities, and early-stage ag-tech companies."

"If you look at our friends to the south, they put 23 times more into research and development into the food and [agriculture] space," Darren Baccus, an executive with Farm Credit Canada, told CBC News.

"Canada is blessed with ample farmland, but we need to drive productivity. And to drive productivity for our farmers and ranchers, we need innovation."

Innovation is often used to refer to new technologies and tools for farmers, but Baccus said it could also mean researching ways to more efficiently ship, package and process products.

He said it could even be consulting with private sector companies about how best to attract more capital investment.

One type of project Killorn sees as being a possible focus for investment is value-added processing. He said processing raw agriculture materials accounts for almost half of the economic impact from the Island's agriculture industry.

"If [processing] companies have opportunities to increase their output, those would be the types of projects that this fund would be designed to support," said Killorn.

Killorn said the Canadian agriculture sector has struggled to attract capital because of "government red tape."

"We're seeing the merits and the fruits of a strategy this government has set in motion with the reduction of red tape and a real … effort to attract capital," said Killorn.

That red tape can be any sort of policies the government implements that limit production and, as a result, drive away interest from capital investors, such as rules or regulation around seed development or the use of pest control products for disease management.