by BETTER FARMING STAFF
Representatives of several agricultural commodities and the Ontario Federation of Agriculture met with five provincial government representatives Tuesday to begin creating a risk management plan for Ontario farmers.
Bette Jean Crews, OFA president, says a plan is needed because several commodities are experiencing financial crisis and “right now, the suite (of risk management programs) that we have, the AgriStability in particular, is not working because it’s based on ever-declining (profit) margins.” AgriStability is a federal and provincial program that provides income support when a farmer experiences large income losses. The farm’s average historical profit margin is used to calculate payments.
During the meeting, pork, beef, horticulture, veal, grains and oilseeds as well as sheep commodity groups shared their individual risk management plans and progress. “We needed to find out where those gaps and where the commonalities were,” Crews says.
She says government officials attending heard the same message repeated around the table – that everyone is committed to working together to design an industry-wide program: “We cannot wait until the next round of business risk program management design; the industry needs help yesterday.”
Crews says the group will pitch an umbrella concept to provincial Agriculture Minister Leona Dombrowsky.
The industry has also promised Dombrowsky it would work with her to try to obtain federal support because the situation is both a federal and provincial issue.
“That’s why we are rushing a bit to get as much done as we can so our minister can go to the federal government (during the Feb. 5, 2010 provincial and federal agriculture ministers meeting) with a solution for Ontario,” Crews says.
One challenge the group faces is how to make the program flexible enough so it works for the entire industry. Another is establishing how some commodities can substantiate their historic costs of production, which would be needed to calculate coverage.
Coverage level is another consideration.
A smaller coalition of commodity groups and the Federation approached Dombrowsky in November seeking approval to establish an industry and government committee to design the program.
Wilma Jeffray, chair of Ontario Pork, one of the organizations in the original coalition, said in a November 17 interview that producers have expressed strong interest in a “level playing field with other jurisdictions and notably Quebec.” A risk management program “is what comes to the surface as a potential solution” to achieving parity.
Such a program would have to be cognizant of live hog exports and therefore match production and processing “closely,” she says.
John Nyenhuis, a Sebringville pork producer and member of a small group of producers promoting industry recovery by balancing production with supply within the province, says a risk management plan is key for the short term.
More steps are needed, however, to ensure long-term sustainability, he says, including establishing a round table that includes all members of the production chain to tackle issues such as changing pricing formulas.
Crews says a risk management program and the current AgriStability program is a short-term solution for the province’s agricultural industry. Ultimately “we need a program that does everything.”
The group next meets in January. BF
