Prime Minister announces initial payment to beef producers and commits to provide more

May 13, 2020
The Government of Canada (GoC) announced its initial support today for Canada’s beef industry amongst other agriculture announcements.  The portion of the announcement pertinent to the beef industry includes: 
  • $50 million in funding for a set-aside program through AgriRecovery, of which the Federal Government covers 60 per cent of costs and the provinces have the option to fund the remaining 40 per cent
  • $77.5 million to support business continuity within agriculture processing facilities (including but not limited to beef facilities), including personal protective equipment for workers and other safety related investments  
  • AgriStability interim payment increase from 50 per cent to 75 per cent as well as extending the deadline to July 3, 2020
The Canadian Cattlemen’s Association (CCA) is deeply disappointed that this initial announcement falls well short of the comprehensive approach needed to help Canadian beef farm families manage through the COVID-19 crisis. Only one of CCA’s three immediate recommendations to address the beef industry’s challenges was partially funded in today’s announcement. The CCA will continue to urgently advocate for the comprehensive approach needed to support Canadian beef producers and the long-term viability of Canada’s food system.  An unprecedented crisis requires unprecedented responses.
The CCA acknowledges the important investment in processing facilities.  “Addressing the current challenges at packing facilities is fundamental to our long-term success in recovering from this crisis,” states Bob Lowe, CCA President. “Investments that will support worker safety and business continuity at processing facilities is essential and we applaud this important investment.  But until such capacity can be brought online, Canadian beef producers will continue to carry the financial burden of feeding and caring for animals that should have been harvested already."
Reductions in processing capacity have resulted in a backlog of 100,000 head of cattle that are ready for market with nowhere to be processed. An additional 6000-9000 head of cattle per day are being added to the current accumulation due to continued reductions at processing facilities. These 100,000 head of cattle alone cost $400,000 a day to feed and care for and the value of a market ready animal has dropped over $500 per head since the start of COVID-19.  The CCA estimates that left unaddressed the Canadian beef industry will lose half a billion dollars by June on market ready cattle alone. 
The CCA recommended a set-aside program which would help producers pay for the unexpected cost of feeding and sheltering cattle beyond their targeted harvest dates.  Today’s announcement provided a fraction of already incurred and anticipated expenses.
Additional recommendations were for government to share the skyrocketing livestock price insurance premiums and enhance the Advance Payments Program (APP) in addition to broader recommendations for the suite of business risk management (BRM) tools available to Canadian farmers and ranchers. As currently designed, the AgriStability program does not provide meaningful protection to most Canadian beef producers.  The Government provided no response to CCA’s further recommendations in today’s announcement.  
“We need insurance, it’s our main risk management tool, it is especially important for our young and new beef producers,” continued Lowe. “Without these tools I am concerned that many beef operations particularly our young producers, will fail or be forced to sell their cattle.” 
Source : CCA
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