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How oil and gas support food security in Canada and around the world

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General view of the ‘TD Canadian 4-H Dairy Classic Showmanship’ within the 101st edition of Royal Agricultural Winter Fair at Exhibition Place in Toronto, Ontario, on November 6, 2023. The Royal is the largest combined indoor agriculture fair and international equestrian competition in the world. Getty Images photo

From the Canadian Energy Centre

By Mario Toneguzzi

‘Agriculture requires fuel, and it requires lubricants. It requires heat and electricity. Modern agriculture can’t be done without energy’

Agriculture and oil and gas are two of Canada’s biggest businesses – and they are closely linked, industry leaders say.  

From nitrogen-based fertilizer to heating and equipment fuels, oil and gas are the backbone of Canada’s farms, providing food security for Canadians and exports to nearly 200 countries around the world.  

“Canada is a country that is rich in natural resources, and we are among the best, I would even characterize as the best, in terms of the production of sustainable energy and food, not only for Canadians but for the rest of the world,” said Don Smith, chief operating officer of the United Farmers of Alberta Co-operative.  

“The two are very closely linked together… Agriculture requires fuel, and it requires lubricants. It requires heat and electricity. Modern agriculture can’t be done without energy, and it is a significant portion of operating expenses on a farm.” 

The need for stable food sources is critical to a global economy whose population is set to reach 9.7 billion people by 2050. 

The main pillars of food security are availability and affordability, said Keith Currie, president of the Canadian Federation of Agriculture (CFA). 

“In Canada, availability is not so much an issue. We are a very productive country when it comes to agriculture products and food products. But food affordability has become an issue for a number of people,” said Currie, who is also on the advisory council for the advocacy group Energy for a Secure Future. 

The average price of food bought in stores increased by nearly 25 per cent over the last five years, according to Statistics Canada. 

Restricting access to oil and gas, or policies like carbon taxes that increase the cost for farmers to use these fuels, risk increasing food costs even more for Canadians and making Canadian food exports less attractive to global customers, CFA says. 

“Canada is an exporting nation when it comes to food. In order for us to be competitive we not only have to have the right trade deals in place, but we have to be competitive price wise too,” Currie said. 

Under an incredible Saskatchewan sky, a farmer walks toward his air seeder to begin the process of planting this year’s crop. Getty Images photo

Canada is the fifth-largest exporter of agri-food and seafood in the world, exporting approximately $93 billion of products in 2022, according to Agriculture Canada.  

Meanwhile, Canadians spent nearly $190 billion on food, beverage, tobacco and cannabis products in 2022, representing the third-largest household expenditure category after transportation and shelter. 

Currie said there are opportunities for renewable energy to help supplement oil and gas in agriculture, particularly in biofuels.  

“But we’re not at a point from a production standpoint or an overall infrastructure standpoint where it’s a go-to right away,” he said.  

“We need the infrastructure and we need probably a lot of incentives before we can even think about moving away from the oil and gas sector as a supplier of energy right now.” 

Worldwide demand for oil and gas in the agriculture sector continues to grow, according to CEC Research.  

Driven by Africa and Latin America, global oil use in agriculture increased to 118 million tonnes of oil equivalent (Mtoe) in 2022, up from 110 million tonnes in 1990.  

Demand for natural gas also increased — from 7.5 Mtoe in 1990 to 11 Mtoe in 2022.   

Sylvain Charlebois, senior director, in the Agri-Food Analytics Lab at Dalhousie University, said food security depends on three pillars – access, safety, and affordability.   

“Countries are food secure on different levels. Canada’s situation I think is envious to be honest. I think we’re doing very well compared to other countries, especially when it comes to safety and access,” said Charlebois. 

“If you have a food insecure population, civil unrest is more likely, tensions, and political instability in different regions become more of a possibility.” 

As a country, access to affordable energy is key as well, he said.  

“The food industry highly depends on energy sources and of course food is energy. More and more we’re seeing a convergence of the two worlds – food and energy… It forces the food sector to play a much larger role in the energy agenda of a country like Canada.” 

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Agriculture

In the USA, Food Trumps Green Energy, Wind And Solar

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From the Daily Caller News Foundation

By Bonner Cohen

“We will not approve wind or farmer destroying Solar,” said President Trump in an Aug. 20 post on Truth Social.  “The days of stupidity are over in the USA!!!”

Trump’s remarks came six weeks after enactment of his One Big Beautiful Bill terminated tax credits for wind and solar projects by the end of 2027.

The Trump administration has also issued a stop-work order for the Revolution Wind project, an industrial-scale offshore wind project 12 miles off the Rhode Island coast that was 80 percent completed.  This was followed by an Aug. 29 announcement by the Department of Transportation that it was cutting around $679 million in federal funding for 12 offshore wind farms in 11 states, calling the projects “wasteful.”

Sending an unmistakable message to investors to avoid risking their capital on no-longer-fashionable green energy, the Department of Agriculture (USDA) is pulling the plug on a slew of funding programs for wind and solar power.

“Our prime farmland should not be wasted and replaced with green new deal subsidized solar panels,” said Agriculture Secretary Brooke Rollins on a visit to Tennessee in late August.  “We are no longer allowing businesses to use your taxpayer dollars to fund solar projects on prime American farmland, and we will no longer allow solar panels manufactured by foreign adversaries to be used in our USDA-funded projects.”

The White House is putting the squeeze on an industry that can ill-afford to lose the privileges it has enjoyed for so many years. Acknowledging the hesitancy of investors to fund green-energy projects with the looming phaseout of federal subsidies, James Holmes, CEO of Solx, a solar module manufacturer, told The Washington Post, “We’re seeing some paralysis in decision-making in the developer world right now.”  He added, “There’s been a pretty significant hit to our industry, but we’ll get through it.”

That may not be easy.  According to SolarInsure, a firm that tracks the commercial performance of the domestic solar industry, over 100 solar companies declared bankruptcy or shut down in 2024—a year before the second Trump administration started turning the screws on the industry.

As wind and solar companies confront an increasingly unfavorable commercial and political climate, green energy is also taking a hit from its global financial support network.

The United Nations-backed Net Zero Banking Alliance (NZBA) “has suspended activities, following the departure of numerous financial institutions from its ranks amid political pressure from the Trump administration,” The Wall Street Journal reported.  Established in 2021, the NZBA’s 120 banks in 40 countries were a formidable element in global decarbonization schemes, which included support for wind and solar power.  Among the U.S. banks that headed for the exits in the aftermath of Trump’s election were JP Morgan, Citi, and Morgan Stanley.  They have been joined more recently by European heavyweights HSBC, Barclays, and UBS.

Wind and solar power require a lot of upfront capital, and investors may be having second thoughts about placing their bets on what looks like a losing horse.

“Wind and solar energy are dilute, intermittent, fragile, surface-intensive, transmission-extensive, and government-dependent,” notes Robert Bradley, founder and CEO of the Institute for Energy Research.

Given these inherent disadvantages of wind and solar power, it’s no surprise that the Department of Agriculture is throttling the flow of taxpayer money to solar projects.  The USDA’s mission is to “provide leadership on food, agriculture, food, natural resources, rural development, nutrition, and related issues….” It is not to help prop up an industry whose best days are behind it.

Effective immediately, wind and solar projects will no longer be eligible for USDA Rural Development Business and Industry (B&I) Guaranteed Loan Program. A second USDA energy-related guaranteed loan program, known by the acronym REAP, will henceforth require that wind and solar installations on farms and ranches be “right-sized for their facilities.”

If project applications include ground-mounted solar photovoltaic systems larger than 50 kilowatts or such systems that “cannot document historical energy usage,” they will not be eligible for REAP.

Ending Misallocation Of Resources

“For too long, Washington bureaucrats and foreign adversaries have tried to dictate how we use our land and our resources,” said Republican Rep. Harriot Hagermann of Wyoming.  “Taxpayers should never be forced to bankroll green new deal scams that destroy our farmland and undermine our food security.”

Hagermann’s citing of “foreign adversaries” is a clear reference to China, which is by far the world’s leading manufacturer of solar panels, according to the International Energy Agency.

According to a USDA study from 2024, 424,000 acres of rural land were home to wind turbines and solar arrays in 2020.  While this – outdated – figure represents less than 0.05 percent of the nearly 900 million acres of farmland in the U.S., the prospect of ever-increasing amounts of farmland being taken out of full-time food production to support part-time energy was enough to persuade USDA that a change of course was in order.

Bonner Russell Cohen, Ph. D., is a senior policy analyst with the Committee for a Constructive Tomorrow (CFACT).

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Agriculture

USDA reverses course under Trump, scraps Biden-era “socially disadvantaged” farm rules

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Quick Hit:

The Trump administration’s USDA is pulling back from defending Biden-era farm aid programs that gave preferential treatment based on race and gender. The move aligns with President Trump’s directive to dismantle remaining diversity, equity, and inclusion initiatives across federal agencies.

Key Details:

  • The Wisconsin Institute for Law and Liberty (WILL) sued on behalf of dairy farmer Adam Faust, challenging USDA aid programs that favor minorities and women.
  • Programs under scrutiny include loan guarantees, dairy coverage, and conservation incentives, all of which disadvantaged white male farmers.
  • USDA issued a final rule eliminating “socially disadvantaged” designations, stating programs must uphold meritocracy, fairness, and equal opportunity.

 

Diving Deeper:

The U.S. Department of Agriculture under the Trump administration is abandoning its defense of farm aid programs created during the Biden years that granted benefits based on race and gender. In a recent court filing, the USDA declined to defend several programs that civil rights watchdogs argue discriminated against white male farmers.

The litigation was brought forward by the Wisconsin Institute for Law and Liberty (WILL) on behalf of Adam Faust, a Wisconsin dairy farmer. Faust contends that the Biden-era rules violated equal protection principles by privileging minorities and women over others in loan guarantees, dairy margin coverage, and conservation cost-share programs.

Under the loan guarantee program, minority and female farmers could secure up to 95% federal backing on loans, while white male farmers were limited to 90%. This disparity directly affected borrowing power and interest rates. Similarly, the Dairy Margin Coverage Program charged white male farmers a $100 annual fee, while exempting “socially disadvantaged” farmers. In conservation projects, minority and female participants received up to 90% reimbursement for costs, while others received only 75%.

On July 10, the USDA issued a final rule to strike the “socially disadvantaged” designation from its regulations, calling it inconsistent with constitutional principles and with President Trump’s policy objectives. “Moving forward,” the USDA rule stated, “USDA will no longer apply race- or sex-based criteria in its decision-making processes, ensuring that its programs are administered in a manner that upholds the principles of meritocracy, fairness, and equal opportunity for all participants.”

The department noted that while the loan guarantee program will be amended immediately, officials are still reviewing how to apply the new policy to the dairy and conservation programs. The USDA also signaled that its decision “could obviate the need for further litigation,” though WILL has indicated its legal fight will continue.

“This lawsuit served as a much-needed reminder to the USDA that President Trump has ordered the end to all federal DEI programs,” said Dan Lennington, deputy legal counsel at WILL. “There’s more work to be done, but today’s victory gives us a clear path to do even more in the name of equality.”

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