What works for livestock producers won’t necessarily work for grain farmers, says GFO chair

What works for animal production sectors won’t necessarily work for the grain sector, says the chair of Grain Farmers of Ontario (GFO), referring to the Canadian Pork Council’s latest request for changes to business risk management (BRM) programs, specifically AgriStability.

While farm groups across the country have been pushing for BRM reform for years, GFO’s lobbying has become noticeably more urgent in recent months, with the launch of an urban campaign targeting political leaders.

As hog producers have been hit hard by COVID-19 market disruptions, the Canadian Pork Council has also grown frustrated with the lack of action by federal and provincial governments when it comes to modifying the criteria for AgriStability payments.

Currently, AgriStability payments are issued when a farm’s income drops below 70 per cent of the farm’s historical reference margin. Up until last week, there was largely a consensus among farm groups to lobby the federal government to raise that trigger from 70 per cent to 85 per cent, and to drop the cap on reference margins.

“Pork producers are concerned that the cost of increasing the trigger to 85 per cent has created a barrier to movement at the federal-provincial-territorial table. As a result, while the pandemic drags on and more farms are pushed to near financial collapse, there has been little action from governments to help them stay in business. Inaction cannot be an option, the consequences on Canadian farm families will be too severe, and therefore we believe the time has come to consider alternatives,” said the council.

So the pork council modified its request: leave the trigger at at 70 per cent, but raise the compensation rate to 85 per cent, as chair Rick Bergmann outlined here.

But GFO chair Markus Haerle, in the interview below, says the pork council’s modified ask won’t work for GFO’s members.

“For the grain sector, it’s the trigger mechanisms that actually flawed within AgriStability at the moment,” he says. “We don’t have the same cycles that pork and beef do, so we rely heavily on bringing that trigger mechanism back up to 85 per cent and no reference margin limiting involved.”

The trigger mechanism and reference margin limit are the two components that make the grain sector ineligible for accessing the BRM payments. according to Haerle. There are many farmers that aren’t enrolled in this particular BRM because the trigger mechanism is too low, says Haerle, especially if their income is diversified.

“We’re sticking to our guns as is,” he says.

There’s been speculation in the past that former finance minister Bill Morneau was not in favour of BRM reform, so a change in that position, with Chrystia Freeland replacing Morneau, could potentially factor into the file, but Haerle figures the hold-up for actually allocating those funds is at the prime ministerial level. Until the federal government recognizes the challenges farmers are up against, Canadian producers will have to continue competing with counterparts in heavily subsidized markets, including the U.S. and Europe, he says.

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