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MBP update on advocacy work with governments in relation to the 2021 drought

Manitoba Beef Producers (MBP) continues its drought-related advocacy efforts with the federal and provincial governments, particularly as it relates to AgriRecovery and other initiatives to help address producers’ immediate and longer-term issues arising from this disaster.

The federal government has committed $100 million through the AgriRecovery Framework to assist producers dealing with extraordinary costs due to drought and wildfire conditions. Federal Agriculture and Agri-Food Minister Marie-Claude Bibeau has stated that the government is ready to seek further funding for provincial government requests that exceed this amount. While this announcement is an important first step, MBP strongly believes additional support will be required and asks for swift action on this.

The timely development and delivery of support programs will be critical in helping to address some of the serious challenges arising from the drought. Discussions between the beef industry and governments will continue as to what those support programs will entail in each province.

The following is an overview of some of the specific asks MBP has been making of governments with respect to AgriRecovery, as well as other programs or services needed to help Manitoba beef producers grappling with the effects of the drought.

Key among these is the need to address producers’ cash flow challenges. A critical component of any AgriRecovery initiative will be helping producers deal with extraordinary costs which are not addressed within the existing business risk management programs. MBP is seeking a per head payment program that would allow individual producers to make management decisions in the weeks and months ahead which are best suited to their particular operation’s situation and available resources.

Unfortunately, some Manitoba producers have already been forced to extensively downsize their herds or to completely liquidate them due to uncertain feed and water resources. They will sustain a significant loss of equity by having to sell into a cull cow market instead of a bred cow market. Some of these producers will wish to re-enter in the future and an effective strategy is needed to help facilitate this. It is expected they will incur extraordinary costs to re-enter as there will be competition for breeding stock which will drive those prices higher than the prices the producers received when forced to sell off due to the drought conditions. The beef industry is analyzing the mechanics of a herd recovery plan to provide the financial assistance required to support producers, such as expanding the eligibility of the per head payment, or using existing mechanisms already established. MBP is seeking further discussions with governments around how such a potential re-entry tool could be fashioned.

New infrastructure is an added cost some producers are bearing, such as providing fencing on Crown lands never grazed before, or on private lands where damaged crops may become available for grazing. MBP is asking that consideration be given in an AgriRecovery initiative to providing assistance for unanticipated infrastructure requirements such as fencing or watering needs.

Some producers have had to haul water, because the ability to access water simply has not been available on their operations. MBP has asked that consideration be given under AgriRecovery to helping to share the costs of hauling water.

The drought has caused significant damage to pastures and forages. MBP has asked that consideration be given to implementing a forage restoration program. Such programs have been initiated in Manitoba in the past via AgriRecovery for flood events.

MBP has requested the principle of retroactivity be taken into account when designing and delivering AgriRecovery initiatives. For example, some producers have already had to commence feeding months ahead of when they normally would. Similarly, some producers have had to send cattle to market or slaughter well ahead of their normal production and marketing plan, with negative financial implications.

Additionally, MBP has cautioned that setting a hard date on the expiry of any AgriRecovery initiative may well prove to be problematic if drought conditions into the next production year. While the hope is that the drought conditions will begin to abate in the weeks and months ahead, this is by no means certain and serious discussions between the beef industry and governments will be required around how to help the sector manage the effects of protracted drought conditions.

It has been announced that Manitoba is invoking the late participation provision of AgriStability (something MBP had requested), and that Manitoba has agreed to increase the 2021 AgriStability interim benefit payment percentage from 50% to 75%. MBP encourages producers to evaluate whether AgriStability could provide benefits for their farm or ranch and to consider participation in it.

The beef industry has asked the federal government to extend eligibility under the Livestock Tax Deferral Provision to include all classes of cattle, not just breeding stock. Producers are having to sell off a range of animals in order to manage herd sizes with available resources. The ability to defer span over more than one year has also been requested to allow for more flexibility in producers’ re-stocking decisions. Many producers in drought-affected areas have already deferred 2020 sales into 2021.

Other Considerations

Regarding agricultural Crown lands, ACL lease holders are among those facing significant losses in terms of grazing and haying productivity. MBP has requested a freeze on rental rate increases in 2021 and potentially beyond if the drought conditions continue. MBP notes that during the BSE crisis there was a period of rental rate freezes with respect to ACL in recognition of the extraordinary financial burden facing producers at this time. MBP believes this to be a reasonable ask given that the productivity of many of the parcels has been vastly diminished by both drought conditions and grasshoppers. Producers have also reported that they have incurred additional expense of hauling feed into the leased pastures as well as pumping water into the dugouts to water their cattle.

Further, some ACL lease holders are seeking consideration for temporary broader use of their ACL parcels beyond the traditional allowable usage period should grazing conditions improve in the fall. This could include the ability to sublet or to utilize those parcels in ways not always permitted under the parcel’s current coding.

With respect to animal health and nutrition, MBP has requested increased departmental extension activities re: utilizing alternate feeds and other drought-specific production considerations. As well, financial assistance for feed testing and source water testing is being sought.

Regarding MASC lending programs, MBP has asked for interest only payments on MASC loans in light of the added financial burden being placed on producers due to drought-related expenses.

As alternate feeds begin to become available, there may be opportunities for innovation in terms of getting cattle to feed or feed to cattle, such as the creation of regional silage piles or feeding sites. MBP is seeking swift permitting processes if required.

MBP had previously worked with government to secure the reopening of BMP 503: Managing Livestock Access to Riparian Areas, which provides cost-shared support for water source development projects. Producers are reminded that applications are being accepted until 11:59 p.m. on September 1, 2021.

Similarly, MBP recognizes MASC, the provincial and federal governments for announcing two initiatives related to AgriInsurance: the early triggering of the Hay Disaster Benefit for 2021 for the eligible producers and the quality adjustment being applied to in-field appraisals. MBP is advocating for this quality adjustment to be extended to crops such as corn and soybeans and potentially others.

It is impossible to place a dollar value on the cost of stress to farm families and rural communities. However the results of chronic stress are manifested in ill health, suicides, farm accidents, family breakdowns, loss of farms, loss of rural businesses and reduced quality of life for our rural citizens. MBP has cautioned governments that stress levels among some affected beef producers are very high. Stressed producers require ready access to mental health resources. Having counsellors well versed in the unique needs of the agriculture sector is extremely important.

MBP has a number of drought-related resources on its website at https://mbbeef.ca/producers/

If you require additional information, please contact MBP General Manager Carson Callum at 204-772-4542 or via email at ccallum@mbbeef.ca .

August 6, 2021