Investment in Agriculture and Agro-Food Business
Canada is globally famous for its high-tech knowledge based agricultural segment. . Canada has its own framework of Agricultural Policy so that the brand “Canada” becomes a leading name in food and agro industry with the specialization in safe preservation of food, scientific innovation and environment friendly production process.
Under NAFTA, Canadian agro industry enjoys an access to a wide market and a combined GDP amounting to US $11.4 trillion as on. In 2003, the agriculture sector totaled 2.2% of GDP with the farm receipts for animal products amounting to $16,213M and $13,055M for production of crops. Comparatively short distance and a highly integrated and committed transportation infrastructure make it easy for agro companies in Canada to serve the U.S. markets in a round the clock manner. For example a huge U.S. population lives within a stone throwing distance of Toronto, and over 60%of target customers are located within a short distance, can be covered by a 2- hour flight journey. Interstate highways are like a network, can connect major Canadian process centers in a very direct and hassle free way.
NAFTA provides procedures for; border facilitation, movement of personnel, adequate certification for production, and protection for investment and intellectual property.
Canadian agro-food export is amounting to U.S. $20.4 billion in 2004, where more than 61% was meant for the United States. Other major market shares exist in Japan, Mexico, China and some parts of Europe.
From the above mentioned statistics it is evident that the agriculture sector of Canada is not only highly improved but also extreme promising and well nurtured venture regulated by federal agency. Investors generally prefer those areas of investment that is risk free and with stable growth. Canada leads the G-7 norms of the safest place and conduct business activities with extreme transparent judicious system, which is one of the reasons for the successful business portfolio of Canada.
Canada has a general awareness for quality food product and overall support for environment friendly activities. R&D process is an integral part of agricultural activities. In Canada this R&D process is specially affiliated by federal agencies and government regulatory bodies. The emergence of scientific methods and IT-technology oriented disciplines is accelerating the pace of research to create new products and scientific farming. This introduces exciting economic opportunities in new applications for agricultural commodities such as nutraceuticals, medicinal ingredients, bio -products and, renewable fuels.
Canada’s agriculture and agro-food ventures are initiated by Agriculture Matching Investment Initiative offers dollar-for-dollar matching funds when they participate in qualifying collaborative research projects. Being supported by these agricultural projects of Canada are really doing well, hence attracting investment.
Due to the advantage of Globalization communication has attended a global standard and as Canada is highly advanced in technology, investment scenario is gradually improving.
These are the advantageous reasons investors should invest in Agricultural Industry. And above all cost advantage available in Canada along with good working environment make it the preferred location for European and Asian firms having a market share in the northern part of U.S. market, and also for most U.S. firms intending to choose investment sites for necessary north-south product-mandates.