by SUSAN MANN
Ontario has given up trying to convince the federal government to fund its share of the Business Risk Management program and will now rework the one-year-old program instead, says Agriculture Minister Ted McMeekin.
Asked how the Ontario government will try to persuade the federal government to pay its share, McMeekin say they’re not. “We’ve given up.” But Ontario is disappointed the federal government hasn’t joined in funding the program, introduced last year for beef, pork, veal sheep, grains and oilseeds along with the self-directed risk management program for fruits and vegetables.
Instead “we’re going to recast the program. We’re going to do that as we always do in OMAFRA we’ll do it collaboratively,” he explains.
The government, like farmers, wants predictability and stability, he says. If commodity prices went down 20 per cent, for example, it would cost the government an extra $300 million in payouts under the program. “That’s not the intent of the program,” he says, noting the program was designed to help grow the industry and provide some reliability and stability. But without the federal “partner there it just isn’t viable.”
The Ontario government is still committed to risk management but “we need to make some changes,” he says. McMeekin says they’ll be talking to farm leaders and work with them to see what needs to be done to reshape the program. “Maybe it’s some marketing funds for some sectors; maybe it’s a leger account for others; maybe its research and innovation in certain areas that can be tracked to growing the industry.”
The program is safe for this year, he says. But discussions on changes have already started.
For their part farm groups are encouraged the Ontario government has preserved the risk management program for this year. The Ontario Agriculture Sustainability Coalition (OASC) is “encouraged by this government commitment and we will be working with Minister McMeekin to continue to provide a risk management program that is predictable and bankable for our farmers as well as the government,” OASC representative Don Kenny says in a press release.
OASC will monitor developments as more budget details become available.
Ontario Federation of Agriculture president Mark Wales says given the government’s necessity to deal with the deficit “from an agriculture standpoint the budget was pretty reasonable. It’s nice to see that the risk management program was noted in the budget as being an innovative approach.”
About the internal reviews the agriculture ministry will be doing to enhance productivity, Wales says that’s not surprising. “They always should look at the most efficient, cost-effective way to use taxpayer dollars.” The idea should be to have the minimum amount of money for administration and the maximum amount of money going to the farm gate where it’s needed, he says. BF
Comments
It's interesting that McMeekin would make this announcement within days of the March 16 deadline for livestock producers to enrol in the 2012 RMP program. He must know that effectively nobody signed up - and that's not surprising. We're almost half way through the income tax season, and, as of now, I don't have one client who had any intention of joining the livestock portion of RMP. I also don't have any client with any intention of joining the grains portion of RMP - and now that there's absolutely no chance of federal participation, that number is going to stay at zero. RMP is so-dead, and it was killed by its own flaws, not by the lack of participation by the feds. Stephen Thompson, Clinton ON
Steve, looking at my RMP Grains renewal and today's market prices any of your clients that are not joining if they grow corn simply can't add. Closing price $4.49, support price $4.90 makes it a no brainer, and likely even moreso after the report tomorrow. I guess all your clients must be out fighting to pay $300+ an acre rent and can't take the time to read their RMP paperwork and the current markets. Thats alright, I might still be around to rent the ground in a year or so when they are busy having an auction sale to pay their rent bill
John Gillespie Ripley
If prices tank, as you suggest, then support prices are going to blow so-far through the 85% AgriStability trigger, that anyone who gets a payment from RMP is going to lose it when AgriStability kicks in - therefore, why needlessly forfeit your RMP premium when you know you're going to lose your benefit? You'd be far-further ahead to ignore RMP completely. Stephen Thompson, Clinton ON
IF and ONLY IF you are a pure crop farm, maybe you will have ag stability trigger a payment since you have had a couple good crop years to build an average, if you are a cattle or hog and cash crop farmer, the poor crop prices this year will only look like the poor cattle/hog prices have been the last few years and your average will not change= no Ag stability payment
My premium for 100% corn RMP is $4.71 per acre, and $2.48 for soybeans. Even if the payout is only 40% on my average yield and todays price of $4.49 for new corn I still get a net payout of $14.50 per acre after my premium. Considering livestock will likely average Ag Stability to no payment why wouldn't I be in RMP
The $19.21 per acre RMP benefit cheque could easily be only an advance on your AgriStability benefit, thereby leaving you $4.71 per acre absolutely worse off than if you had stayed out of RMP completely - a situation which happened to me in 2009. Why not just spend the $4.71 per acre on more fertilizer instead? Stephen Thompson, Clinton ON
Times 40%, - the premium, - the bean and wheat premiums that look like a much worse bet unless you grow 100% corn, - your agstab premiums and if you are somebody that paid attention and got a good portion of your crop contracted at some very good prices that were available to us, I can see why many might not be so excited about RMP in 2012.
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