A report released last week by The School of Public Policy refers to Alberta’s agri-food industry as a “gentle giant that’s about to awaken,” and could be a big player in the province’s post-COVID-19 rebound.
The authors of the report, Karen Spencer and Kim McConnell, found the industry is in a great place, with the potential to “serve the changing appetite of Canadians and the Western world.”
Alberta’s Minister of Agriculture and Forestry, Devin Dreeshen said he believes the industry is a key component to the province’s economic recovery.
“There’s tremendous growth potential in agriculture and we’re starting to see those types of investments land here already.
“I think with COVID(-19)… it just highlighted its importance even more — when you looked at the border staying open entirely for food products coming in and out of this province,” Dreeshen said.
While the main driver of Alberta’s economy for many years was oil and gas, agriculture is not taking the stage, experts say.
“We hope that this report brings (agriculture) back to the foreground and we can show people how important it is for all of us. It’s a need, it’s a necessity, and how much impact we have on the economy with our agriculture industry,” Spencer said.
The report points to data from Statistics Canada and the Canadian Energy Regulator, which show total sales in Alberta’s agri-food sector last year was 31 per cent higher than the province’s gross crude oil sales.
The multi-pronged report is part of the Alberta Futures Project, which Spencer said is focused on developing some specific policy recommendations on how to help kick-start the Alberta economy post pandemic.
In 2019, Alberta’s primary agriculture sector hired 49,000 people, making the agri-food industry the province’s largest employer, according to Statistics Canada.
The report points out specific obstacles and challenges farmers face which could be preventing them from doing business in the best and most efficient way.
“One of the big ones that we see… that perhaps people within our cities aren’t really aware of… is the internet,” Spencer said.
“There are statistics that show that about 50 per cent — or under 50 per cent — of rural Albertans have what would be deemed an unacceptable level of internet connectivity.”
Spencer pointed out the irony of that statistic considering how advanced technology is within farming equipment, yet rural connectivity is years behind where it should be, compared to higher populated areas.
When asked about how the province plans to address that issue, Dreeshen said the government has launched a new Canadian Agriculture Partnership (CAP) program with farmers to provide “internet boosters” and other technology advances.
The Farm Technology Program is focused on sensors that contribute to farm data systems, as well as technology-based security devices, while supporting producers protect their businesses through the adoption of best management practices in farm security.
“The Internet of Things is obviously very important to a lot of industries, but there’s so much potential for it in agriculture,” Dreeshen added.
Advanced technology has been a huge focus in the agriculture industry over the past couple of decades and Spencer believes the trend will continue to make the industry sustainable and, in turn, a leading economic driver.
“So right now, about 70 per cent of our crops in Alberta use precision agriculture and that’s a method that is sustainable, it retains more carbon in the soil, it means that farmers can use less added fertilizers and so on,” Spencer said.
However, she added “that sustainability has to be married with economic sustainability so that it can be, really, an answer to growing Alberta’s economy.”
‘Trying to make the agriculture world a better place’: AgTech advancements improve farm efficiency, safety
The School of Public Policy is hoping the new report will shine light on the success in Alberta’s agri-food industry, but also bring attention to struggles producers face and what’s causing roadblocks for future growth.
“One of the things… the school is really good at is we do not just produce papers that just sit on shelves and collect dust, we produce papers but we are very active at communicating them to both the public and to policymakers within government and, of course, elsewhere,” Spencer said.
She added this report is written in layman’s terms and hopes it’s easy enough to understand, so everyone can get something out of it. However, the biggest goal is to have the government implement policies that will help further the agriculture industry in our province, allowing it to strengthen — or at least stabilize — Alberta’s economy.
“We’d love to take the next step and work on some more specific policy discussions with stakeholders, and see what we can do,” Spencer said.
The minister of agriculture said the government appreciates these types of reports that have “a different lens than we typically would as a government.”
“These types of reports are helpful in us when we consult with industry stakeholders, when we consult with farmers and ranchers to figure out what we, as government, can do to… help, but also what we can do to not hurt that the industry so it’s helpful,” Dreeshen said.
“And like I said, there’s tremendous growth potential.”
© 2021 Global News, a division of Corus Entertainment Inc.
As the economy hits its peak, stock market gains could be harder to come by – CNBC
Diminishing economic returns could mean diminishing stock market returns as the U.S. transitions to a post-pandemic economy.
Wall Street increasingly is talking about peak growth in both the economy and corporate earnings as a stimulus-fueled recovery gives way to more normalized patterns.
Congress and the Federal Reserve have provided trillions in funding and liquidity measures that soon either will dry up or at least begin evaporating, leaving investors to ponder what lies ahead with their portfolios.
The market will have to handle what is likely to be a lasting bout with inflation at a time when the drivers for growth are uncertain.
“It’s a world that we haven’t had to deal with in 40-plus years, and I don’t think you can just take out your regular playbook from the last couple of decades,” said Peter Boockvar, chief investment officer at Bleakley Advisory Group. “Valuations of pretty much everything are extraordinarily high, which means there’s no room for error.”
Boockvar spoke of an environment in which inflation will be higher as growth moves lower, a cycle known as “stagflation,” something the U.S. wrestled with for years from the mid-1970s to early ’80s. Practically no one thinks the current conditions will morph into something that bad, but there are similarities.
Inflation is running at 30-year highs, according to the Fed’s preferred gauge, while growth lately has been solid but a bit disappointing. Second-quarter GDP rose at a 6.5% annualized pace, but that was well below the 8.4% Wall Street estimate. Manufacturing data released Monday showed the sector still expanding, but at a lower-than-expected rate.
The factors are combining in “the classic recipe for a growth scare,” wrote Nick Colas, co-founder of DataTrek Research.
Looking at Apple Mobility and Google data that examines how people are getting around, Colas found that they are providing “a worrisome combination” though it’s too early to tell how things will shape out in the long run.
Still, he warned that investors high on the second quarter’s record-breaking pace of corporate earnings beats may find trouble ahead.
“Excellent Q2 earnings have allowed us to shake off that [growth scare] narrative every time it’s come up in recent weeks,” Colas said. “Now that the bulk of earnings season has passed, however, and seasonal volatility trends assert themselves we may see the growth scare narrative break through more convincingly.”
The trouble with optimism
The factors of higher inflation, slowing growth and waning stimulus occur amid high levels of investor sentiment as the major stock market averages hover around record highs.
In fact, that brimming optimism is flashing warning signs, according to Bank of America.
The firm’s gauge of investor sentiment that measures Wall Street portfolio allocations to stocks is the closest it’s been to a “sell” signal since May 2007, shortly before the market was about to hit record highs that soon would come tumbling down during the financial crisis.
“We have found Wall Street’s bullishness on stocks to be a reliable contrarian indicator,” Savita Subramanian, head of U.S. equity and quantitative strategy at Bank of America, said in a note to clients. Higher allocations to stocks eventually end up pointing to a decline ahead, the gauge has shown.
Subramanian said the indicator’s current level is pointing to price returns in the next 12 months of just 7% compared with the average forecast of 13% since the financial crisis ended in 2009.
To be sure, a slowing economy doesn’t mean negative returns, and the current conditions may be pointing at nothing more than a cooling off for a market that has been on fire since rocketing to its pandemic low in late March 2020. After all, even though fiscal stimulus is slowing, the Fed remains committed to keeping its policy ultra-loose until it sees much more progress on employment.
“With the recovery still underway, investors shouldn’t be frightened by headlines declaring slowed momentum,” said Seema Shah, chief strategist at Principal Global Investors. “Once markets have digested the transition to a more sustainable pace of expansion, decelerating growth is usually associated with weaker, but still positive, equity returns.”
In fact, the past two peaks in earnings cycles have led to double-digit market gains over one-, three- and five-year periods, said Jason Pride, chief investment officer of private wealth at Glenmede.
“Rather than obsessing over near-term growth peaks, investors would be wise to see the bigger picture,” Pride said in his weekly market note.
Still, signs that growth is abating are worrisome.
The bond market in particular is pointing to a substantial slowdown ahead, with the 10-year Treasury note yielding just 1.18% Monday afternoon. The benchmark yield below 1.25% is the bond market “signaling not all is well economically,” wrote Christopher Harvey, senior equity analyst at Wells Fargo.
Boockvar, the Bleakley investment chief, said the current economic environment could cause problems for a market that has relied on investors willing to pay consistently at higher valuation multiples.
“One of the characteristics of the equity market in the 1970s was one of multiple compression,” he said. “A lot had to with the sharp rise in interest rate. But it becomes a more challenging environment with a bout of stagflation, even if it’s stagflation-lite.”
Become a smarter investor with CNBC Pro.
Get stock picks, analyst calls, exclusive interviews and access to CNBC TV.
Sign up to start a free trial today.
Working from home is here to stay, and that's hurting the economy – CNN
Drag on the recovery
Delta variant bears down on China just as its economy loses steam – CTV News
The Delta variant poses new risks for the world’s second-biggest economy as it spreads from the coast to China’s inland cities and presents fresh challenges to authorities who have for months managed to avert any widespread outbreak of the coronavirus.
Barely a month after disrupting industry in the southern export hub of Guangdong, cases of the Delta variant were detected in Nanjing, capital of Jiangsu province on the coast. The infections were traced back to a flight from Russia.
Since Nanjing confirmed its first Delta cases on July 20, numerous cities in southern China and a few in the north including Beijing have reported infections. The tally of locally transmitted cases stood at 353 as of Sunday.
It was not immediately clear whether Nanjing was the source of all the infections, as some authorities have yet to disclose the outcome of their virus-tracing efforts.
Jiangsu, the province with the second-largest economic output after Guangdong in 2020, is by far the worst-hit, accounting for about 80 per cent of the confirmed cases.
The emergence of the variant, which is more transmissible than the original strain first detected in the city of Wuhan in late 2019, has seen the return of tough counter-epidemic measures.
Many cities have warned against non-essential travel, required proof of negative tests for those who do travel, and launched mass-testing for the virus.
Policymakers are under pressure to ensure that while populations are protected, economies are not excessively strained.
China’s overall economy is not invulnerable. It grew more slowly than expected in April-June, due to persistently high raw material prices, cautious consumer spending and a subdued real estate market.
“The Delta variant is the biggest test of China’s zero-COVID strategy since the initial outbreak last year,” said Julian Evans-Pritchard, senior China economist at Capital Economics.
“But given the country’s track record in dealing with the virus so far, our assumption is that they will quash the outbreak before it gets out of control. Of course, doing so will come at some economic cost.”
Yangzhou, near Nanjing, has been battling rising coronavirus cases since last Wednesday. Many factories and logistics firms in the city of 5 million have been shut as employees joined queues of people to get tested, some up to three times a week.
“We cannot deliver goods because the delivery firm informed us that they’ve suspended their services,” said a manager of a toy factory surnamed Wang.
“In the past few days, many places have been gradually locked down. We were officially told to stop operations today, and all our employees didn’t come to the factory.”
Tourism in some smaller cities could take a hit in August, usually a peak travel season due to the summer school break.
Zhangjiajie, where dramatic stone pillars inspired the Hallelujah Mountains in the 2009 blockbuster “Avatar,” has seen an outbreak, linked to Nanjing, traced to a theatrical performance at a tourist site on July 22.
Zhong Nanshan, a coronavirus expert who helped shape China’s COVID-19 response, told a conference on the weekend that he was not too worried about the ability of big cities, like Nanjing, to tackle the virus with their “excellent” control systems, state media reported.
But there were questions about the ability of smaller places, like Zhangjiajie, with limited resources when suddenly having to test and trace the 2,000 people in the audience for the show as well as their close contacts, he said.
Zhangjiajie, nestled in the mountains of Hunan province, has gone into a semi-lockdown, closed tourist sites and indoor entertainment venues, and told people to avoid unnecessary trips.
“All staff at our hotel must take nucleic acid tests every two days,” said a front desk attendant surnamed Li at the Zhangjiajie Huatian Hotel.
The hotel is not open to the public and its online reservation system is suspended.
A staffer surnamed Yin at Zhangjiajie China International Travel Agency said everyone at her agency had been sent home for a “vacation.”
“We’re waiting for the notice on when we can start working again,” she said.
(Reporting by Ryan Woo and Roxanne Liu; Additional reporting by Beijing Newsroom)
Spanish cave art was made by Neanderthals, study confirms – The Guardian
A&E Plus Art-A-Thon raises funds for Cornwall Art Walk – Cornwall Seaway News
Quebec's test positivity rate highest since May as COVID-19 infections climb – CBC.ca
Silver investment demand jumped 12% in 2019
Europe kicks off vaccination programs | All media content | DW | 27.12.2020 – Deutsche Welle
Iran anticipates renewed protests amid social media shutdown
News23 hours ago
Canada’s Delta-driven 4th wave of COVID-19 will be ‘different’ amid vaccinations: experts – Globalnews.ca
Tech16 hours ago
OnePlus Nord 2 owner claims new phone burst into flames – SlashGear
Health14 hours ago
Germany plans Covid booster shots from September: draft text – FRANCE 24
Economy22 hours ago
Spain has a two-speed economy with high unemployment – The Economist
Business18 hours ago
N.B. sees spike in COVID-19 cases amid reopening – CTV News
Health18 hours ago
If I've already had COVID, do I need a vaccine? And how does the immune system respond? An expert explains – Flipboard
Investment22 hours ago
N.S. Liberals unveil training and skills platform, $78M college investment – Toronto Star
Health9 hours ago
COVID-19 in B.C.: Almost 250 new cases and over 1,200 active cases; almost 700 active cases in Interior Health; – Flipboard