Canada to compensate supply-managed sectors

The investment will help farmers make key investments
calendar icon 15 November 2022
clock icon 3 minute read

On a dairy farm in the Eastern Townships, Agriculture and Agri-Food Minister Marie-Claude Bibeau re-affirmed the Government's commitment to provide compensation for supply-managed sectors for the impacts of the Canada-United States-Mexico Agreement (CUSMA), according to a government-issued press release. Dairy, poultry and egg producers and processors are expected to share more than $1.7 billion in direct payments and investment programs.

This federal investment will help dairy, poultry and egg producers and processors make key investments and improve their operations to be even more competitive and sustainable.

While dairy producers already know how much they will receive next year under the fourth compensation payment for the Canada-European Union Comprehensive Economic and Trade Agreement (CETA) and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) the Government intends to offer them extra funding of up to $1.2 billion over six years under the Dairy Direct Payment Program to account for the impacts of CUSMA.

From 2024 to 2029, the owner of a farm with 80 milking cows may receive compensation through a direct payment of about $106,000 in six yearly instalments on a declining scale. These funds will give producers the flexibility to invest according to their individual needs.

Starting in 2023, the Government intends to invest up to $300 million in a new program to support innovation and investment into large-scale projects to add value to solids-non-fat, a by-product of milk processing. The government will consult closely with industry stakeholders in the development of program parameters.

"Canada's 2,800 chicken farmers are proud stewards of our land, providing high-quality, sustainable, nutritious food for Canadians. Today's further investment in our sector will help farmers enhance the long-term efficiency and sustainability of their farms and continue to feed Canadians," said Pierre Lampron, chair of the Dairy Farmers of Canada.

For the Canadian poultry and egg producers, the government intends to provide up to an additional $112 million under the Poultry and Egg On-Farm Investment Program. Producers will receive payments based on their quota holdings, to support improvements to their farm businesses. This funding will bring the total compensation for this sector to $803 million.

Finally, the federal government intends to invest up to $105 million in the Supply Management Processing Investment Fund to support investments in dairy, poultry and egg processing plants, to grow their productivity or efficiency through new equipment and automation technologies. This brings the total investment for processors up to $497.5 million.

These programs will help drive innovation and growth in the supply-managed sectors. With this announcement, the government of Canada delivers on its commitment to fully and fairly compensate producers and processors who have lost market share under CETA, CPTPP and CUSMA. The total compensation will reach up to $4.8 billion.

"Our farmers are proud to offer Canadians high-quality eggs of local production and support rural jobs and our economy," said Tim Klompmaker, chair of the Chicken Farmers of Canada. "The measures outlined in today's announcement provides a tool to navigate the impact of CUSMA on our sector, and benefits all Canadians as egg farmers continue to embrace green tech, make enhancements to their farm operations, and grow their sector. Canada's more than 1,200 egg farmers are committed to upholding our strong, domestic food system—today and into the future."

"Hatching egg producers across the country have experienced losses due to recent trade agreements but we are pleased to see that the Fall Economic Statement has addressed an ongoing commitment to Canadian poultry and egg farmers on programming to offset the impact of the CUSMA agreement," said Roger Pelissero, chair of the Egg Farmers of Canada. "This funding will help our producers reinvest to make our sector stronger and more resilient which benefits all Canadians."

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