Government of Canada taking action to support drought-stricken Western producers

Ottawa, Ontario – Agriculture and Agri-Food Canada

The Minister of Agriculture and Agri-Food, the Honourable Lawrence MacAulay, announced an initial list of designated regions in British Columbia, Alberta, Saskatchewan and Manitoba where Livestock Tax Deferral has been authorized for 2023 due to extreme weather conditions.

The Government of Canada recognizes the significant challenges livestock producers in Western Canada are facing due to exceptionally dry conditions. Compounded by subsequent years of drought, pastures and forage production are significantly impacted, leading to low feed supplies for livestock. The government stands with farm families during this difficult time and is taking action to respond.

The Government of Canada has also worked quickly with the governments of British Columbia, Alberta and Saskatchewan on joint AgriRecovery assessments to examine the impacts of the drought and wildfires. Work with provinces is urgently progressing to finalize the AgriRecovery process and to determine any additional support required to cover the extraordinary costs incurred by producers.

The Livestock Tax Deferral provision allows livestock producers who are forced to sell all or part of their breeding herd due to drought or excess moisture to defer a portion of their income from sales until the following tax year. The income may be at least partially offset by the cost of reacquiring breeding animals, thus reducing the tax burden associated with the original sale.

As a preliminary list of prescribed drought and flood regions is usually completed in the early fall, designation of this provision earlier in the year helps provide assurance for producers as they make difficult herd management decisions. The Government of Canada will continue to monitor conditions across the country and will add other regions throughout the year if they meet the criteria.

Producers have access to a comprehensive suite of business risk management (BRM) programs that are the first line of defense for producers facing disasters, including AgriStability, AgriInsurance and AgriInvest. The Government of Canada has already supported requests from British Columbia and Alberta for late participation in AgriStability, as well as requests from British Columbia and Saskatchewan to increase the interim payment rate under AgriStability from 50% to 75%. Minister MacAulay also highlighted federal support for British Columbia, Alberta and Saskatchewan to make a one-year adjustment to the AgriInsurance program to make more drought-damaged crops available for feed. This increases the amount of crops available for livestock producers in this time of need.