By Mark Reusser, Vice President, Ontario Federation of Agriculture

Farming can be full of unexpected crises, from market volatility and crop losses due to bad weather to tragedies like barn fires. Having security and stability to ensure Ontario farmers remain profitable and protected is vital to the viability of the farming industry and the Ontario economy. After all, agriculture in Ontario supports 860,400 jobs and contributes over $47 billion to the economy annually.

Cue Business Risk Management programs – tools to provide farmers with protection against income and production losses and help them manage risks beyond their control that threaten the financial sustainability of farms.

Earlier this summer, the Ontario Federation of Agriculture (OFA) was pleased with the announcement at the Federal-Provincial-Territorial Ministers of Agriculture meeting in Saskatoon that enhancements are being made to improve federal and provincial Business Risk Management programs.

As a result of open communication and frequent conversations with federal and provincial officials, the ministers agreed to two significant improvements to the AgriStability program. In 2021 the Reference Margin Limitation provisions were removed from the AgriStability program, which increased the predictability of the program while also increasing the likelihood farmers trigger a payment and potentially receiving a larger payment. Earlier this year, ministers also agreed to increase the compensation rate for the AgriStability program from 70% to 80% for the 2022 program year. This means farmers who trigger a payment will receive a larger payout under the program moving forward.

AgriStability protects farm businesses against large declines in farming income for market, production or economic reasons beyond their control. It is the only tool in the current suite of Business Risk Management programs that helps farmers manage both production and market risks. These include external, unpredictable challenges like weather, plant or animal diseases, transportation problems, trade issues, and geopolitical considerations like the Russian invasion of Ukraine can impact farm businesses.

Along with the Canadian Federation of Agriculture (CFA), OFA had regularly been encouraging governments to strengthen their existing Business Risk Management programs to provide greater financial support to farmers who have experienced loss due to risks beyond their control.

The recommendations and requests OFA made to government policymakers to improve the AgriStability program came as a direct result of feedback we received from our 38,000 farm business members across the province. We appreciate the effort and collaboration of government to recognize the needs of farmers and address them with program enhancements.

There are currently three Business Risk Management programs available to farmers, and OFA has long been hearing farmer concerns and asking for program enhancements that would both boost coverage available for farm businesses and improve farmer participation rates by simplifying and streamlining program administration.

In addition to the compensation rate change in the AgriStability program, OFA has also been asking for governments to restore the program’s payment trigger to 85% of a farmer’s historical reference margins.

AgriInvest is a self-managed producer-government saving program designed to help farmers manage small income declines and make investments to manage risk and improve market income. For this program, the ask is for an increase in the basic maximum matched producer contribution rate to 1.5% of Allowable Net Sales and to establish a $100,000 annual maximum for matching contributions.

AgriInsurance is a cost-shared program that stabilizes income by minimizing the economic effects of primary production losses caused by severe but uncontrollable natural hazards. OFA wants to ensure farmers in all provinces have greater access to adequate AgriInsurance coverage when they face short-term, multi-year consequences from weather-related disaster like drought or floods.

The next federal-provincial agricultural policy framework will come into effect in 2023. OFA, along with CFA and other industry partners, will continue to work with the federal and provincial governments to secure additional financial and administrative improvements to these programs. By working together, we’ve been able to acknowledge and accommodate differences between provinces and commodities while recognizing the strengths that come from a united approach.

Without a suite of fully funded Business Risk Management programs, Canadian farmers remain at a competitive disadvantage on the global market, and we look forward to continuing to build our relationship with governments to identify and address areas for program improvement.

Food security plays an important role in overall national security, and it is critical that Ontario and Canada continue to protect and support our agriculture sector so that we never lose our ability to feed ourselves.

For more information, contact:

Tyler Brooks
Director of Communications and Stakeholder Relations
Ontario Federation of Agriculture
519-821-8883 ext. 218
tyler.brooks@ofa.on.ca