REGINA - Less than 24 hours prior to Sunday’s election call, the federal government announced changes for Agri-Stability.
The changes are being framed as a way to help farmers hit by Chinese duties on canola meal, canola oil, peas and pork, as well as the possibility of U.S. tariffs next month. The tariffs from China took effect March 20.
“China’s decision to apply these tariffs will have a devastating impact on our farm families and their communities. We’re working hard to diversify our trading partnerships and establish new markets, but we know the sector needs support now,” said Kody Blois, Minister of Agriculture and Agri-Food and Rural Economic Development in a news release from Saturday. “Today’s announcement is a direct result of their advocacy – and our commitment to them. As Canada’s Minister of Agriculture and Agri-Food and Rural Economic Development, I will continue to stand shoulder-to-shoulder with our producers and will defend the sector every step of the way.”
Agri-Stability is funded on a 60/40 basis by the federal and provincial governments. It is designed to help producers when their program year margin is less than 70 percent of reference margins based on past years.
The compensation rate will move to 90 per cent, up from 80 per cent.
But Kevin Hursh, the Chief Agricultural Editor of SaskAgToday.com, points out the increase to the compensation rate doesn’t make more producers eligible for the program because the aforementioned payment trigger is the same.
“If they had changed the trigger so that more people would be eligible, it would have been a lot bigger change, but this will provide some support for people who end up in a claim position when they fill out all their paperwork.” said Hursh.
Not all farmers are enrolled in Agri-Stability, but those who are usually have an accountant handle it. Some call it a “complicated program”, but Hursh believes un-enrolled producers will want to make some inquiries prior to the June 30th signup deadline.
“I know a lot of accountants are going to be struggling to get their applications all filled out by then, coming out of tax season, and start working immediately on Agri-Stability,” added Hursh.
Hursh says cow-calf producers may also want to see if Agri-Stability makes sense for them. Calf prices have been up and margins have been improving, Hursh said, so it could likely result in better reference margins, making Agri-Stability more attractive in the event prices go down.
The other change will see the maximum payment go from $3 million to $6 million dollars for the 2025 program year.
In a news release from Saturday, the federal government is giving provinces and territories the option to enter into an agreement “to issue interim payments at a higher payment rate and initiate Targeted Advance Payments in the event of tariffs, or for the hog sector in the event of African Swine Fever” to get the money to producers faster.
APAS reacts to AgriStability changes
The Agricultural Producers Association of Saskatchewan (APAS) welcomed enhancements to Agri-Stability as “positive steps” and urges the provincial government to agree to the changes and implement them as soon as possible.
But “while AgriStability offers whole farm protection, payments are often received long after significant financial losses have occurred. Saskatchewan farmers will potentially have to borrow a lot of money in the interim to manage critical cash flow due to these market disruptions,” noted Bill Prybylski, President of APAS in a news release issued Monday morning.
APAS had talks with Blois about increasing the interest-free portion of the Advance Payments Program (APP) again to $350-thousand from $250-thousand – the latter amount was changed March 7 from the typical $100-thousand.
APAS says the greater amount would act as a “response measure to provide producers with crucial access to upfront capital in the face of this trade crisis and to assess if AgriInvest can be used to allow farmers access to capital. These immediate actions are essential to help bridge the gap while longer-term support measures are being finalized and implemented.”
Prybylski praised Blois’ engagement and efforts in his first week as Federal Agriculture Minister “are very positive and represent more progress than has been seen in recent years.”
(With files from Neil Billinger, CJWW)
