A $261 million injection of emergency cash into the Canadian Agricultural Income Stabilization program by the Alberta government will be welcomed by many farmers, but will be too late for others.
Alberta Agriculture minister Doug Horner said officials kept a close eye on this year’s crops and prices, and it was clear farmers’ were in for another disastrous year.
“July weather conditions of extremely high temperatures and low precipitation over 70 percent of the province, dramatically reduced our yield expectation.”
Combined with that, he said commodity prices and the rising dollar prompted the province to take action.
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“Now we have the perfect storm of these very high input costs as well as a lower yield and a depreciation on the market side that bodes a very ill wind for this year’s harvest,” said Horner during a news conference.
“These producers have been through some very tough times.”
The realized net income for Alberta farmers has fallen 54 percent to $329 million in 2005, down from $715 million in 2004. The 2006 estimate for realized net income is projected to decrease to $249 million, he said.
“This is a much needed investment of $261 million by the province of Alberta to assist Alberta’s agricultural producers.”
Instead of a blanket injection of cash, the money will be used as additional support under the CAIS program. Based on the 2004 claim year, reference margins will be increased by 25 percent of the fuel and fertilizer costs and there will be a general reference margin increase of 15 percent.
Nelson Mayko of Andrew, Alta., said based on his 2004 claim year, the disaster assistance program will give him an extra $52,000.
“That will help a lot. Maybe it will pay for the extra fuel and fertilizer prices,” said Mayko who had 3,200 acres of crop in his 2004 claim year.
“I don’t know what’s going to happen down the road. It’s not likely farm and fertilizer prices are going down.”
Leroy Fjordbotten, a former Alberta agriculture minister and spokesperson for the Alberta Grain and Oilseeds Crisis Advocacy Trust, said while farmers had hoped for some form of aid payment this spring, it’s still welcome news.
“We’re very pleased Horner has made the effort. We all know how hard it was to get it through Treasury Board and get $261 million.
“They’ve recognized the farm crisis and they’ve made a step. That’s important,” said Fjordbotten, whose group was originally calling for a $50 per acre cash payment.
After the cash payment was rejected, the group continued to lobby for a change in the reference margins to increase cash to needy farmers.
“For some it’s too late. It’s been too long in coming. It’s unfortunate they didn’t do this earlier in the spring,” Fjordbotten said.
Horner said the department targeted the fertilizer and fuel prices of the 2004 claim year because of the dramatic increases in prices.
It estimated fuel prices have increased 40 percent and fertilizer prices 70 percent since 2003.
“What we’re trying to do as best we can is ensure we’re targeting those costs within the individual producer’s operation that have had the most appreciation and most dramatic effect on his operation,” said Horner.
“The biggest voice we heard across the province is on input costs.”
Over 90 percent of the farm production in Alberta comes under the CAIS program. There are 32,000 producers enrolled in the program.
Farmers do not have to apply to the program for the assistance.
The money is expected to be in their hands by November.
