September 14, 2012

Farmers to Manage Increased Business Risk in 2013

 

WHITEHORSE – September 14, 2012 – Farmers across Canada are going to need to plan to work with reduced BRM programming in 2013 and beyond as a result of cuts to Agri-Invest and Agri-Stability announced today at the Fed-Prov Ag Ministers meeting in Whitehorse.

“I think most farmers will be split on these changes,’ says Stephen Vandervalk, President of the Grain Growers of Canada. “On one hand we have aggressively lobbied for more investment into research and innovation and so are pleased to see more funding there, but on the other hand there are substantial cuts to some key risk management programs.”

Today in Whitehorse, Federal and Provincial Ag Ministers lowered the Ag Stability margin coverage from 85% to 70%, and lowered the Ag Invest matching dollars from 1.5% to 1%. They also agreed to put more money into research and innovation.

“Our farmers are efficient and competitive and want to make their living from the marketplace,” says Gary Stanford, Vice President of the Grain Growers of Canada. “However there are times when forces like drought or world markets require us to rely on risk management tools so we were pleased to see the Advance Payments, Ag Recovery and Ag Insurance programs remaining in place.”

With nearly $35.5 billion in exports, Canada is the world’s fifth-largest exporter of agriculture and food products. In 2009, the agriculture and agri-food sector accounted for approximately 2 million jobs in Canada and 8 per cent of total GDP.

“Farmers will be disappointed with the cuts to Ag Invest as we understood the program,” said Allan Ling, Atlantic Grains Council President and Grain Growers Director. “The big challenge with both CAIS and Ag Stability was how hard they were to understand and so I’m hoping the changes to Ag Stability, like on negative margins for example, will help it to be more predictable so that as farmers we know what our coverage is every year.”

“The Federal Government has got it right on many important agriculture files like the creation of the Market Access Secretariat, opening trade negotiations in our export markets, the Prime Minister and Agriculture Minister participating in trade missions to key countries, marketing choice for wheat and barley and encouraging farmers to focus on the marketplace,” says Irmi Critcher of the British Columbia Grain Producers Association and Grain Growers Director. “Changes are never easy, but we are pleased to see a mid-term review of these changes is scheduled in case this doesn’t work out.”

Part of the money from the cuts will be redirected to research and innovation.

“At the Grain Growers, finding ways to fund more research is one of our highest priorities, so we are glad to see additional money being allocated.” says Richard Phillips, Executive Director of the Grain Growers of Canada. “Having varieties of grain with better yields and more resistance to insects, diseases and drought will help stabilize our farm incomes and may help reduce the need to draw on support programs in future years.”

While disappointed with the level of cuts, the Grain Growers of Canada will now focus on the coming rail service review legislation, modernizing the Canadian Grain Commission, and helping determine the priorities for the research and innovation dollars available.

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