Manitoba reverses policy on grazing lease renewals

Producers pleased they will now have first right of renewal on existing crown leases; proposed move to open auction had been a concern

Manitoba cattle producers are breathing a little easier knowing they will have first right of renewal on existing crown agricultural leases.

The provincial government announced Oct. 11 it would give them that right after outrage over new regulations that allocated leases by open auction.

Producers liked the idea of an auction, saying it is a more transparent way to allocate leases, but said they needed certainty to maintain viable cattle operations.

“It’s a step in the right direction,” said Manitoba Beef Producers general manager Carson Callum after the government changed its mind.

But he said there are still pieces missing from what MBP asked for last spring.

The government said last year it wanted to change the crown lands legislation. It amended its agricultural crown land act and announced new regulations in September.

It has changed lease length from 50 years to 15 years. Carson said that was initially a problem but now with first right of renewal it has become less so.

“A lot of producers called it a 15-year countdown without that,” he said. “There’s always worry in the back of your mind that you could lose it in an auction so you might not put as much investment or infrastructure into it.”

Producers with leases expiring before Dec. 31, 2034, have the first right to renew the lease until then. The lease would then go for auction.

Those who have leases expiring after that date continue under the existing terms.

Robert Metner, MBP director for District 11, said producers are still worried about unit transfers and the new rental formula that came along with the changes.

He said there is more security now with the decision to give producers first right of renewal.

“But a lot of people are wondering if they can afford it,” he said.

He estimated the increase at about 300 percent and said it will be a lot to pay for marginal land.

“The grass is not the same on crown land as on deeded land,” he said.

The new formula is based on the average price of 500 to 600 pound steers and heifers for the previous three years, as of Sept. 30, multiplied by 3.5 percent and animal unit months as calculated by Manitoba Agriculture.

The government said it would be phased in and take full effect in 2021.

Callum said the association will continue to press the government on the formula.

“We need to ensure that this (rental) formula is fair and not only fair but we need to look at the transition time into this increased rental rate. It’s been tough back-to-back years for these producers in terms of feed prices and what not so we definitely need to investigate this rental increase and how quickly it comes into play,” he said.

“To drop a major increase in price on producers in a difficult time is never a good thing.”

Another issue is access. Producers want to have informed access to crown land, rather than open access.

“We want to make sure that people would have to inform the leaseholder, not only for the safety of the people going on but also the safety of the animals,” Callum said.

The government hosted two public meetings last week and MBP began its fall district meetings this week.

Both Metner and Callum said the issues would be raised again.

Manitoba has about 1.45 million acres of agricultural crown land, much of it used for grazing and forage.

There are 1,750 leaseholders and the land can feed about 90,000 head of cattle, the government said.

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