NFU asks AB and SK to allow late enrollment in AgriStability
Dear Minister Marit/Minister Horner
RE: Late enrollment in AgriStability
The National Farmers Union (NFU) is requesting that you trigger late-enrollment in the AgriStability Program for your province’s farmers and ranchers for the 2021 season, one of the most challenging on record.
Many farmers made a business decision to forward contract a portion of their crop. This allowed them to lock in prices early in the season and ensure they would be able to deliver and receive payment at a time that allowed them to manage their cash flow and debt repayment obligations prudently. However, the record drought meant some crops yielded as little as one or two bushels per acre in the hardest hit areas. Some farms got enough rain to harvest a modest crop, but dry conditions are so widespread that many had such significant yield loss that they were unable to fulfill the terms of their contracts.
When farmers did not have a Force Majeure clause in their contracts (and many companies no longer offer this option), they found themselves in the position of having to either buy local grain at much higher prices to make up the shortfall or to pay the difference between the contracted and current prices in cash. Paying input bills and operating loans under these circumstances is going to be impossible for some, and cause serious hardship for many more. We are concerned that this situation will result in a significant number of good, hardworking farmers losing their farms, or becoming so discouraged by the heavy added debt burden that they will exit the industry.
Guaranteed delivery contracts that some farmers entered into with grain companies have put some farmers into severe financial difficulty. As the contract buy-out is classed as an eligible expense under AgriStability, late enrollment into the AgriStability Program may save some of the worst affected farms. Changes to this federal-provincial cost-shared program in effect since 2012 have resulted in the enrollment dropping to less than one-third of Canadian farmers. This has left thousands of farmers without a safety net when they need it most.
Manitoba and British Columbia recognized the problems associated with the systemic environmental volatility that caused a widespread drought across nearly all of western Canada this summer early, and did allow their farmers and ranchers to access the AgriStability Program even if they had not enrolled by the earlier deadline.
We are sure that as Agriculture Minister, you would do all in your power to help your province’s farmers survive this year’s terrible financial blow and ensure they are in a position to plant a crop in 2021-22. This is why we are urgently requesting that you follow BC’s and Manitoba’s example and allow late enrollment in AgriStability. This will make it possible for thousands of financially stressed farmers to enroll and obtain the support they need before it is too late.
We look forward to your announcement in the coming days.
Sincerely
[signed]
Will Robbins,
NFU 1st Vice President (Policy)
