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Ottawa unveils $252 million aid for farmers, agribusiness, plans $200-million loan expansion

Tuesday, May 05, 2020 @ 2:24 PM | By Cristin Schmitz

Prime Minister Justin Trudeau announced targeted financial support totalling more than $252 million to support farmers, ranchers, food businesses and food processors — and served notice that his government will be introducing legislation to make available an additional $200 million in borrowing capacity to assist the agribusiness sector.

According to an announcement May 5 from the Prime Minister’s Office, giving agricultural producers and food processors more financial assistance to adapt to the many challenges brought on by the COVID-19 pandemic will help keep workers, and Canada’s food supply chain, safe.

The government said it will:
  • Create a $77.5 million “Emergency Processing Fund” to help food producers: access more personal protective equipment; adapt to health protocols; automate or modernize their facilities, processes, and operations; and respond to emerging pressures from COVID-19 so they can better supply Canadians with food during the pandemic.
  • Launch a national “AgriRecovery Initiative” of up to $125 million in funding for producers faced with additional costs due to COVID-19. This includes set-asides for cattle and hog management programs to manage livestock that are backed up on farms, due to the pandemic-related temporary closure of food processing plants. The government said the new federal funding will help beef and pork producers and processors adapt to a changing market, and help farmers and ranchers keep their animals longer before marketing. In his daily COVID-19 briefing May 5, Trudeau called this move an “initial investment and if we need to add more, we will.”
  • Work with the opposition parties to pass the required legislation to increase by $200 million the Canadian Dairy Commission’s borrowing limit in order to support costs associated with the temporary storage of cheese and butter to avoid food waste.
  • Launch the first-ever federal “Surplus Food Purchase Program,” with an initial $50-million fund which aims to redistribute existing and unsold food product inventories — for example in potatoes and poultry — to local food organizations serving vulnerable Canadians.

Through AgriStability, a joint federal, provincial and territorial program, Ottawa said it will work with the provinces and territories to increase interim payments to 75 per cent from 50 per cent to producers who face significant revenue declines (a change that has already been agreed to by British Columbia, Quebec, Saskatchewan, Prince Edward Island and Alberta.)

The enrolment deadline for the 2020 AgriStability program has been extended to July 3, 2020.

The government also said it is working “with provinces and territories to explore possibilities for expanding the Agri-Insurance program to include labour shortages as an eligible insurable risk for the horticulture sector — i.e. to insure against lost production due to an insufficient workforce, should producers be unable to find enough labour to harvest.

The government noted that AgriRecovery funding is normally cost-shared by Ottawa and the provincial, and territorial governments. However the program will become more flexible so that the federal government can directly provide its share of the funding to producers, regardless of whether provinces and territories are able to contribute.