Saskatchewan MP Ralph Goodale’s position on the potential use of AgriRecovery to backstop farmers during the trade dispute with China is a welcome development.
It would be an extraordinary use of the program, but then Canadian farmers are in an extraordinary situation.
Funding for AgriRecovery is split 60-40 with the provinces, and indeed, the program’s rules state that the provinces must make the request of the federal government to initiate funding.
But the provinces aren’t there yet.
Goodale, who is the public safety minister, may have been politicking — just sending a message to farmers that the federal government is willing to go beyond tinkering with the other business management programs — or he may have been sending a tacit message to the Chinese that Canada is willing to go big on farmer support as the United States has done in its trade dispute with China.
Regardless, his comments are useful.
His position dovetails with Prime Minister Justin Trudeau’s comments last week in which he said China’s rejection of Canadian canola, ostensibly due to pests, is “unjustified,” even saying “they’re inventing excuses around that to block canola and perhaps next steps as well.”
That is a significant break from his previous low-key comments that Canada is trying to settle the issue with science. Yet, China has refused to accept a scientific delegation.
Last week, China’s ambassador to Canada, Lu Shaye, who is being transferred to France, said his country has supplied all the documentation Canada needs on the issue, even though the Canadian Food Inspection Agency said it has found nothing wrong with Canadian canola exports.
It’s widely accepted, even obliquely acknowledged by the Chinese, that the canola dispute is as a result of Canada’s arrest of Huawei executive Meng Wanzhou in Vancouver in December for extradition at the request of the United States.
So China isn’t going to let science resolve the situation until the leadership says so.
Canola is western Canadian farmers’ most reliable crop and China buys 40 percent of Canada’s canola seeds, worth about $2.7 billion annually. China’s targeting of canola is strategic.
The federal government has made some changes to help farmers, allowing producers to borrow up to $1 million, and canola growers to borrow $500,000 interest free under the cash advance program, and extending the AgriStability deadline to July 2.
Meanwhile, the U.S. announced a $12-billion backstop for farmers last July, followed by $16 billion in support announced last month.
The Canadian Federation of Agriculture is calling for “immediate reforms” to the business risk management programs, in part due to trade uncertainty, but also in the face of potential drought in the West and following a 45 percent drop in producers’ realized net farm income last year.
The CFA has suggested restoring AgriStability margin coverage to 85 percent and removing AgriStability’s reference margin limit.
That may entice more farmers to sign up because payouts would kick in more often.
But a long-term trade dispute with China could put other agricultural exports in jeopardy, including pork and peas.
If that happens, tinkering with AgriStability isn’t going to cut it.
AgriRecovery’s program rules would need to be changed and Goodale has acknowledged some willingness to do that.
His comments do not represent a grand gesture to show the Chinese that Canada is willing to go all out to support farmers caught up as pawns in the dispute, but it’s an acknowledgment that such a gesture is possible.
Karen Briere, Bruce Dyck, Barb Glen, Brian MacLeod and Michael Raine collaborate in the writing of Western Producer editorials.