If you’re going to give any praise a farm safety net program that’s been steadily criticized over the years, you have to expect some feedback.
In a recent column, I took the unusual stance of pointing out the benefits of AgriStability. The program has not worked well for livestock producers suffering years of poor margins. Nor is it very useful for grain producers who haven’t been making money.
But many Saskatchewan grain farmers have had some good years and they’ve built up strong Agri-Stability reference margins. For those producers, the program is providing a great deal of protection going into the 2010 growing season.
There was an error in the previous column. I didn’t describe the reference margin calculation properly. An Olympic average is used, meaning the high year and the low year of the last five are removed. If the best three years could be used, grain producers would have even better reference margins.
While grain producers in Saskatchewan were largely silent over the premise of the column, grain producers in Ontario sent emails claiming they haven’t been doing well and therefore AgriStability is not providing much support.
With different crops and much higher costs in Ontario, they classify AgriStability as a complete failure. There’s also interesting politics at play in Ontario, politics that could affect farm safety net programming for the whole country.
Grain and oilseed farmers in Ontario lobbied hard for a Risk Management Program (RMP) that was implemented within that province back in 2007. However, it was supported by only the Ontario government. Ontario and its farmers have been pressing ever since to have the federal government contribute its traditional share of funding.
Although some Ontario producers deny that RMP is a cost-of-production program, that’s exactly how it’s described by the Ontario government. To be eligible, however, producers have to participate in production insurance and the AgriStability program.
RMP support prices are established for each eligible crop based on production costs. Producers pay premiums depending upon which percentage of the support price they want to insure.
A few short years ago on an Ontario grain farm, Stephen Harper said a Conservative government would scrap the CAIS program (the predecessor to AgriStability). That won the Conservatives farmer votes in rural Ontario.
Now the feds are refusing to participate in RMP and a lot of farmers in Ontario are ripping mad.
Here on the Prairies, most producers will tell you that a program covering the cost of production would be wonderful. But there’s little expectation that it will ever come to pass. Such a program would no doubt be subject to international trade action. Plus, the program would be open to all sorts of abuse.
Expectations are different in Ontario. Maybe it’s the influence of having such a large supply-managed dairy sector where prices are based on a cost-of-production formula. Maybe, it’s because producers in neighbouring Quebec have long had much more lucrative farm programs than anywhere else in the nation.
And maybe it’s because Ontario farmers feel that they have some political power.
On the Prairies, the Conservatives have a virtual lock on the farm vote. When producers think of the Liberals, they remember the policies of Pierre Trudeau and much more recent fiascos such as the long-gun registry.
Ontario farm votes, on the other hand, are up for grabs and can be enough to swing entire ridings.
The squeaky wheel gets the grease and Ontario farmers are squeaking loudly. In the past, Prairie grain farmers have sometimes benefited from federal efforts aimed at appeasing Ontario grain producers. That could happen again.
Kevin Hursh is a consulting agrologist and farmer based in Saskatoon. He can be reached at [email protected]