Forage exporters are miffed they’ve been ignored by the federal government once again.
Shippers of processed hay and alfalfa are reacting with “disbelief and disappointment” to a farm aid announcement that excludes their industries.
“Despite extremely low yields in some areas for two consecutive years, we have been told we don’t qualify as producers for the second instalment of federal transition funding,” said Dale Pulkinen, speaking for Canadian dehydrators and hay associations.
The industry was excluded from the first $600 million of federal transition aid because payments were administered through the Net Income Stabilization Account program. The ownership structure of the dehy industry prevents processing plants from participating in NISA.
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But the two associations had been “led to believe” more flexible eligibility criteria would be in place for the second $600 million aid package. That turned out to be wishful thinking, despite heavy lobbying by the industry.
A spokesperson for federal agriculture minister Lyle Vanclief was contacted for this story, but didn’t respond by press time.
Pulkinen applauds the federal government for making rule changes that allow forage processors to participate in proposed programs under the agricultural policy framework.
But he said it doesn’t make sense to turn around and exclude them from accessing federal transition money.
“It’s inconsistent and damaging to the industry to exclude us from the current funding, which some of our members badly need,” said Pulkinen.
Poor crops and low prices have caused a severe downsizing in the forage processing industry. Canadian firms are having a tough time competing with heavily subsidized European product.
Today, only one third of the dehy plants are operating in Canada compared to 1998. Over that same time annual exports of alfalfa pellets and cubes have fallen to 250,000 tonnes from 700,000 tonnes.
It’s a similar story for compressed hay, said Pulkinen. Shipments will fall to an estimated 225,000 tonnes in 2003, down from a high of 300,000 tonnes two years ago. And although 2003 was a vast improvement for most farmers, it was not a good production year for many forage processors in Alberta and Saskatchewan.
One firm northwest of Edmonton faces a 74 percent crop yield loss due to drought and grasshoppers, while a timothy hay processor northwest of Calgary is looking at a 66 percent loss from 2002.
The decline in production isn’t as dramatic in northeastern Saskatchewan where alfalfa processors are facing yield reductions ranging from 25-38 percent, said Pulkinen.
