Ottawa-With coordinated action by government, industry and investors to boost value-added processing, Canada could grow its agrifood exports to Europe, Asia and Latin America by $44 billion by 2035, says a study by RBC Thought Leadership.

That would enable the agrifood sector to reduce its dependence on the U.S. where agricultural exports have increased year-over-year because of a move to more value-add processing such as pasta from wheat and French fries from potatoes, the study said. Already, 70 per cent of Canada’s agrifood exports that go to the U.S. are in the value-added category. In contrast, Canada’s sluggish export growth relative to markets such as Brazil and Chile amounted to an estimated $23 million loss in revenue potential.

The tariff challenges facing Canada present an opportunity to diversify its exports by leveraging its access to existing markets and expand in emerging markets, requiring coordinated action across government, industry, and investors. There are supply-and-demand gaps for fruits and vegetables, along with meat and seafood. “Optimizing efficiency in Canada’s production process through smart utility management of water, energy and waste and broader land use can create a foundation for domestic and global food security.”

At the same time, the sector an innovation jolt to build on actions by Canadian producers at adopting and integrating technologies such as variable rate technology into their operations. “Accelerating the adoption of precision farming and food processing technologies can further increase productivity and efficiency,” the study said.

The sector also needs a domestic investment playbook for scaling up agri-food processing clusters to add value to raw commodities and expand Canada’s footprint in global markets. “Canada is well-positioned to lead in plant-based foods, with the potential to capture 10 per cent of the global market by 2035.”

Due to limited financial support, Canadian producers are suffering from a dilution effect in their market development and access approach, the study said. “By looking inward, it can identify its top agriculture and agri-food products with corresponding high-growth markets such seafood in Europe.”

Redeploying Canada’s rural connectivity funds to focus on addressing the lack of rural and remote 5G access could add between $2.7 billion and $3.5 billion to Canada’s GDP by 2030 through boosting input efficiencies and farming automation. Another key action would be improving shipping container processing as turnaround times at Canada’s ports are slower than many large competitors. “Investing in national transportation infrastructure and accelerating Canada’s container logistics can increase Canadian products’ speed to market by reducing bottlenecks and improving export reliability.”

This news item prepared for National Newswatch