It's not all heirloom tomatoes, alpacas and farm markets; getting into agriculture takes money and solid planning
By Lexi Bainas, Citizen July 22, 2011
Farm Credit Canada.
If the name sounds familiar, it should.
They've been around for 50 years across the country and have had an office in the Cowichan Valley since 1998.
FCC is a federal crown corporation that offers financing for farmers, all the way from small operations just starting up to massive agri-businesses that have been around for generations.
The Citizen talked to FCC's relationship managers Barry Remus and Pat Durose at their office at 202-2700 Beverly St. in Duncan about financing, farming, and related subjects.
Remus and Durose both have long histories in farming and are proud of their corporation's traditional ties to one of Canada's most important communities.
FCC's roots are deep, according to Remus.
"When the Second World War veterans started to come back in 1945, the [federal government of the day] set up the Veterans Land Act. It helped veterans who wanted to buy a house or a farm or a business. The Veterans Land Act would actually lend them money at a good rate to do so, to get them started. It created employment when all the soldiers came back. Then, in 1961, the Farm Credit Corporation actually took over the Veterans Land Act and administered the portfolio and turned it more towards the direction it's taking today," he said.
FCC is national, with offices strategically placed throughout Canada and offers services to all kinds of farmers, not only those producing primary products like dairy and berries or chickens but also those working in areas that include processing, like vineyards and cheese plants, said Durose.
Prior to the late 1990s, FCC would send an account manager over from Abbotsford to handle Valley accounts and queries.
"He'd come over once a month or so and do a blitz, handling enquiries. But since October 1998 our doors have been open here," she said.
Remus said the Cowichan Valley office has grown from there.
"Even though it may seem that there's a lot of consolidation in agriculture and farms are getting larger, there are a lot of small operations starting out with five or 10 acres, which could be market gardens or whatever offering higher value crops. If you've been watching the farmers' market downtown, you'll remember there wasn't that much volume of product at the start but when you look at it today, you can buy almost anything there from homemade bread and baked goods to jams and produce. It's exciting," he said.
Vancouver Island is somewhat unique because there are many small parcels of land that can be farmed and the price of land itself here is also a factor, he said, agreeing that some of the Valley's farmland could also be described as the most appealing residential land in all of Canada.
Can farming pay enough to pay that price?
"I think that is a challenge that agriculture producers are faced with all across Canada. They try and establish an agriculture business in a rural residential area in competition with rural residents who don't look for production off the land to pay all their mortgages and bills. Basically, we [FCC] fill that gap. The nice thing about Vancouver Island is that we can grow 230-240 different agricultural crops whereas in the rest of Canada they're curtailed.
"Some areas can only collectively grow five or 10 crops plus livestock. People on the prairies aren't growing truffles or things like that; those are high value crops that are paying for high value land." Remus said.
Vancouver Island is a unique area. There are lots of different eco-systems. One person can grow something here and another person two miles down the road can't grow it, he said, adding that on the Island, the Cowichan Valley is one of three main pockets of agricultural land. The others are the Saanich peninsula and the Comox Valley; there's also a little area in the Parksville/Coombs region.
Both Durose and Remus said that agriculture is huge here in the Cowichan Valley and that knowing where food comes from is becoming more and more important to local residents.
Remus pointed out that films like Nick Versteeg's Island on the Edge have enhanced consumer support of agriculture on Vancouver Island by showing how little food supply is actually available here, if the offshore supplies ceased.
People are even looking at producing older varieties of fruits and vegetables on smaller farms and finding interest among buyers.
Remus said there are two sides to that and both can benefit.
"There is a reason for their popularity at markets. A lot of the heritage varieties were bred for taste, rather than shelf life. And nowadays, many varieties grown in big farms are bred for volume production to help pay for the price of land."
This is opening a window for a different kind of agriculture, for smaller operators, options that are even increasing on the prairies along with places like the Cowichan Valley.
So, how do clients find their way to FCC?
Durose said a lot of it is word-of-mouth. Everyone in the industry knows about the corporation. "We understand agriculture. We understand their business and we have access to resources."
Think tanks at FCC cover subjects like the beef industry, the poultry industry, and what's happening in wineries. There's a knowledge base there, and it's community-based within that special group, she said.
The Internet and booths at agricultural conferences, trade shows and other events also spread the word.
People trying to get into agriculture for the first time learn, while doing their due diligence, preparing a business plan, researching and talking to farmers in the area, that Farm Credit is around and helpful, Remus said.
"That's all we specialize in. Once you have a large enough critical mass, you can learn by experience. When you finance as much of agriculture as we do, you create your own understanding within the industry. There are other financial institutions that finance agriculture but it's our total focus and we believe we have an understanding of the area."
Durose agreed.
"We're known. We cater to our people, work from a farming perspective."
Still, one of the biggest challenges is helping people who've never been involved in farming before.
"It's because the market value of land and the amount of capital involved is so large. But we do offer some different programs. We have a transition program in which the vendor will carry some of the funding but we'll guarantee the funding to the vendor. That lets the new farmer start with enough equity. We have a number of different programs for people in different situations. But, at the end of the day, we're like all financial institutions: we lend out money and we expect to get it paid back," Remus said.
Are people able to move into agriculture in the Cowichan Valley if they want to?
It depends on the industry, according to Remus.
"Some industries are a lot easier. If people have the drive to do something, they will get there. It used to be that if you couldn't get a job, you could always go back to the farm," he said. "Well, those days are gone in agriculture. Now, it needs passion and drive."
Durose emphasized that there is plenty of planning needed, too.
Anyone who wants to get into farming really has to set it up like a business, with a business plan that shows where they are now, where they hope to be in five years time and how they are going to make that happen.
The Cowichan Valley is also attracting families or couples who want a career change and see farming as a viable opportunity.
"The capitalization, all the management strategies and techniques to be successful are no different than any other business out there. Agriculture's changing as fast as any other industry out there."
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