Grain Growers of Canada calls on government to provide meaningful support amidst trade disruptions

-

Grain Growers of Canada (GGC) on May 14 called on the federal government to develop a strategy to address an increasingly unpredictable trade environment affecting the incomes of grain farmers across Canada. The strategy should recognize that China’s blocking of Canadian canola is politically motivated, which was acknowledged last week by Prime Minister Trudeau.

Yesterday, the United States Government announced $15 billion in aid to help farmers whose products may be targeted with Chinese tariffs amid the deepening trade war. This marks the second round of assistance after the $12 billion plan last August to compensate American farmers for lost sales and low prices as a result of trade disputes with China and other countries. President Trump has also indicated that the government will not hesitate to purchase grains from US farmers for distribution as food aid, further distorting markets.

The escalating trade war between the United States and China is having a significant impact on grain farmers across Canada. In addition to the recent suspension of canola imports from Canada over unproven phytosanitary concerns, soybean prices are dropping and imports to China have slowed to a trickle, reaching levels not seen in a decade. Industry and government officials have confirmed that Chinese importers are reluctant to sign contracts for other Canadian agricultural products given the uncertainty in the market.

“The time has come for the Canadian Government to aggressively defend the interests of Canada’s agriculture sector in China and around the world,” said GGC Chair, Jeff Nielsen from his farm in Olds, AB. “This is a non-partisan issue and Canadian farmers need government support to ensure that we are well positioned to weather this storm.”

GGC is calling for the Government of Canada to develop a strategy to address the increasingly complex and unpredictable trade environment in which Canadian farmers find themselves. As they work towards this goal, GGC is asking the Government to consider ways in which it can support Canadian farmers starting by the immediate implementation of meaningful changes to the AgriStability Program to ensure it is a bankable, predictable, simple and scalable program. This includes coverage for margin losses below 85 per cent and removal of the reference margin limit. These changes can be made under the current Business Risk Management program framework.

While changes to the Advanced Payment Program (APP) may only help farmers manage cash flow issues in the near-term, the increase in the interest-free portion from $100,000 to $500,000 should not be limited to canola. Several commodities are being negatively impacted by the current situation either directly or indirectly and the government needs to open the interest free portion up to all commodities.

“The issues we are seeing with trade into China can no longer be said to be commodity specific,” said GGC Vice Chair Markus Haerle from St. Isidore, ON. “As a soybean farmer I’ve seen my prices plummet and markets close due to the flooding of the market by US product.”

For too long, grain farmers have seen market after market close because of non-tariff barriers to trade. In addition to Chinese disruption, the loss of the Indian pulse market and Italian durum market has added to the long list of risks that farmers are expected to manage – risks that are well beyond their control. Canada’s grain producers appreciate it when the Government stands behind our world-class products – now it is time for them to do everything in their power to keep markets open so the sector can reach its full growth potential.

Source: Grain Growers of Canada

Wheat Growers React to Federal Canola Funding

-

The Western Canadian Wheat Growers reacted to the announcement by the federal government May 1 that it will increase the amount that can be loaned to canola farmers under the cash advance program.

“The China decision to block canola has had a major impact on grain farmers with no end in sight. Farmers don’t want tax dollars in the form of interest free loans, we want to be able to grow our grains and export them without political interference,” said Gunter Jochum, President.

Farmers are used to managing risk associated with factors that are outside of their control such as weather. Factors such as trade markets and political interference should be within our government’s control.

This new program may help short-term cash flow for some farmers, but to be eligible for $1 million advance on canola where $500,000 is interest free, you have to produce approximately 200,000 bushels of canola. In order to qualify for the maximum, you need 5,263 acres at 38 bu per acre, which is roughly a 16,000 acre farm.

Simply put, this is a political problem and needs a political solution. Sadly, the Federal Government has mismanaged grain exports in many parts of the world:

  • Canola stopped by China
  • Durum wheat blocked by Italy
  • Pulse non-tariff barriers in India
  • Non-tariff trade barriers blocking wheat with Vietnam, Peru and Saudi Arabia

Furthermore, we have not had a Canadian Ambassador in China since January 25, 2019 – over four months of missed opportunity for diplomatic solutions. Meanwhile, Canadian citizens are detained in Chinese jails in inhumane conditions, with no representation and Canada is funding the Asian Infrastructure Investment Bank (AIIB) over $250 million in the next 5 years.

“It’s time to stand strong. In 2017 Canada imported over $54 billion in goods. Perhaps it is time to play this situation in a different way – the old way certainly hasn’t been working,” stated Daryl Fransoo, Director.

Source: Western Canadian Wheat Growers

Cash Advance Program Enhancements Support Farmers

-

On May 1, Agriculture and Agri-Food Minister, Marie-Claude Bibeau, announced a series​ of enhancements to the Advance Payments Program (APP) that support farmers facing cash flow challenges in Canada’s grains and oilseeds sector. These changes include increasing the maximum allowable limit available under the APP from $400,000 to $1,000,000, and expanding the program’s interest-free component for canola from $100,000 to $500,000 until market conditions stabilize. The interest-free component will remain at $100,000 for all other commodities included under the APP.

“The current market situation is creating great uncertainty for farmers,” says Bernie McClean, President of Canadian Canola Growers Association (CCGA). “With cash flow being farmers’ most immediate concern, we welcome enhancements that will help build financial predictability for at least the short to medium-term.”

“The Canola Working Group established by Minister B​ibeau has focused on a number of short, medium and long-term tools that could help farmers and the wider industry manage through the current market access issues with China,” says Rick White, CEO at CCGA. “With planting just getting started and higher than normal stocks of last year’s canola crop remaining in farmers’ bins, we’re pleased to see actions being taken on the recommendations of the working group.”

With the APP program improvements just announced, CCGA is working with Agriculture and Agri-Food Canada program staff to incorporate the changes into the cash advance program. “We’re already working on the necessary changes to our systems so that farmers can access these benefits quickly,” says White. White expects CCGA will be in a position to process applications at the new limits in the near future. CCGA began issuing advances under the 2019-20 APP on April 1, 2019.

Farmers are encouraged to go to www.ccga.ca​ for updates or call 1-866-745-2256 to speak with a CCGA Contact Centre representative.

In addition to the changes announced about the APP, Minister Bibeau also announced a 2-month extension to the application deadline for AgriStability.

“We sincerely thank Minister Bibeau for taking action to support Canada’s farmers during this time of uncertainty,” says McClean. “We look forward to the continued efforts of the Canola Working Group and future actions to support farmers and Canada’s canola industry.”

CCGA represents canola farmers on national and international issues, policies and programs that impact farm profitability and is an official administrator of the Government of Canada’s Advance Payments Program.​

China: Update on Canola Seed Market Access

-

Alberta Canola continues to work on behalf of growers through the Canola Council of Canada (CCC) on the challenges that persist for canola seed exports to China. Chinese buyers remain unwilling to purchase Canadian canola seed, and the licenses of two companies (Richardson and Viterra) to export canola seed to China have been suspended. Canola oil and meal are not subject to the same challenges as canola seed.

The CCC is working closely with the government of Canada to find science-based solutions and resume stable trade as quickly as possible. The Government of Canada has acted quickly, and is engaged at the most senior levels to resolve the issue. This has included numerous interactions between the Canadian Food Inspection Agency and their Chinese counterpart to resolve quality concerns that have been raised, including a request for a high-level mission to intensify science-based discussions. Technical discussions with China are required to resolve technical concerns.

Since March 1st, the CCC has met with the prime minister, the foreign affairs minister, the trade minister, the federal agriculture minister as well as contact with both the Saskatchewan and Manitoba agriculture ministers, emphasizing the importance of resolving the issue for the whole Canadian value chain, including farmers, and how this affects all Canadians.

We are confident in the quality of Canadian canola. Our canola consistently meets the requirements of countries around the world. We will continue our efforts to focus attention in Ottawa on resolving this issue as quickly as possible.

Source: Canola Council of Canada

CCC releases new seed cost feature for the Canola Calculator

-

The Canola Council of Canada (CCC) has released a new seed cost feature for the Canola Calculator to help canola growers set seeding rates that balance agronomy and economics. Improvements in seeding and plant establishment are important to the industry’s strategic plan to sustainably and profitably increase average canola yields.

“The original tools at canolacalculator.ca helped growers improve plant establishment and profits by setting seeding rates and plant density targets that align with seed survival, seed size and risk factors such as frost and insect damage,” says Autumn Barnes, agronomy specialist and stand establishment lead with the CCC.

The new updates add seed cost to the equation. As growers enter different scenarios in the Seeding Rate & Seed Cost Calculator, they can see the economic impact of factors such as seed size, percent emergence and target plant density.

“The goal is to help growers and their advisors make more refined seeding decisions rather than defaulting to 5 lb./ac, regardless of seed size or field conditions,” says Barnes.

The CCC recommends a target plant density of 5-8 plants/ft2 (50-80 plants/m2). Growers can use the target density calculator to determine where in that range they want their individual fields to be, and then measure the economic impact of that density. Yield potential is known to decline with stands of four plants per square foot or less, and extra plants provide some buffer for in-season plant losses, optimum maturity and competition with weeds.

The new seed cost feature of the Canola Calculator was coordinated by the CCC, with funding provided by Alberta Canola, SaskCanola and the Manitoba Canola Growers Association.

In addition to the Canola Calculator, growers, agronomists and industry members are encouraged to visit CanolaEncyclopedia.ca for a comprehensive resource of best management practices based on the latest research findings. In the past, canola growers were advised to target plant densities of 7-10 plants/ft2 however emerging analysis indicates that plant densities of modern hybrid varieties are optimized at 5-8 plants/ft2. Recent updates to the plant establishment section include these new plant density recommendations and information on seeding rates.

Source: The Canola Council of Canada

Canola Council of Canada: Challenges persist for canola seed exports to China

-

The Canola Council of Canada (CCC) is providing an update on market access challenges affecting all canola seed exports to China.

While there was some initial optimism that Chinese concerns with canola trade could be resolved quickly, technical discussions to date have not indicated an immediate resolution is possible. Canola seed exporters report that Chinese importers are unwilling to purchase Canadian canola seed at this time.

“We’re disappointed that differing viewpoints cannot be resolved quickly,” says Jim Everson, president of the CCC. “Under the circumstances, Canadian canola seed exporters who normally ship to China have no alternative but to supply customers in other countries who value high quality Canadian canola.”

China has been a major market for Canadian canola, accounting for approximately 40% of all canola seed, oil and meal exports. Canola seed exports to China were worth $2.7 billion in 2018. Demand has been very strong until recent disruptions.

“Canadian ministers and government officials have responded quickly to Chinese concerns, however, technical discussions are unlikely to lead to an immediate resolution,” says Everson. “We urge the Government of Canada to continue to intensify efforts to resolve the situation.”

The Canadian canola industry makes every effort to meet the requirements of customers and their governments around the world. From seed developers, growers, processors and exporters, all segments of the value chain coordinate to ensure consistent and high quality canola.

“Canadian canola is of the highest quality because of our world-class quality assurance systems,” says Everson. “We have a long-standing history of delivering on quality and reliability. We will continue to provide our customers with high quality canola and promote stable trade based on science.”

The Canola Council of Canada is a full value chain organization representing canola growers, processors, life science companies and exporters. Keep it Coming 2025 is the strategic plan to ensure the canola industry’s continued growth, demand, stability and success –  achieving 52 bushels per acre to meet global market demand of 26 million metric tonnes by the year 2025.

China has Stopped Buying all Canadian Canola Seed

-

Trade tensions with China concerning Canadian canola seed just escalated.

Canola seed exporters report that Chinese importers are unwilling to purchase Canadian canola seed at this time, the Canola Council of Canada says. The news comes just weeks after China announced it had revoked the sales licence for canola supplier Richardson International. China said the move was related to pests and disease detected in the crop, although no evidence was presented showing Canadian canola has phytosanitary issues.

“We’re disappointed that differing viewpoints cannot be resolved quickly,” says Jim Everson, president of the CCC. “Under the circumstances, Canadian canola seed exporters who normally ship to China have no alternative but to supply customers in other countries who value high-quality Canadian canola.”

China has been a major market for Canadian canola, accounting for approximately 40% of all canola seed, oil and meal exports. Canola seed exports to China were worth $2.7 billion in 2018. Demand has been very strong until recent disruptions.

“Canadian ministers and government officials have responded quickly to Chinese concerns, however, technical discussions are unlikely to lead to an immediate resolution,” says Everson. “We urge the Government of Canada to continue to intensify efforts to resolve the situation.”

The Canadian canola industry makes every effort to meet the requirements of customers and their governments around the world, the Canola Council notes. From seed developers, growers, processors and exporters, all segments of the value chain coordinate to ensure consistent and high-quality canola.

“Canadian canola is of the highest quality because of our world-class quality assurance systems,” says Everson. “We have a long-standing history of delivering on quality and reliability. We will continue to provide our customers with high quality canola and promote stable trade based on science.”

CCGA Launches 2019 Cash Advance Program With Interest Rate Savings For Farmers

-

Starting March 5, farmers wanting to get a jump start on their spring cash advance can submit their 2019 Advance Payments Program application form to Canadian Canola Growers Association (CCGA). New this year, farmers who take out an interest-bearing advance will benefit from a reduced interest rate below prime. CCGA has also expanded its advance offering with four new organic grains including wheat, oats, peas and flax.

“Farmers anxious to complete their advance application before seeding have been contacting us,” says Rick White, CEO of CCGA. “Having our application form ready well in advance of the April 1st program start date is just one way our team is enhancing cash advance services for Western Canadian farmers.”

In the past two years, CCGA has implemented several important changes to its cash advance services, and in 2019, the organization is taking another step to create even more value for farmers. “We are passing on the benefits from our operational efficiencies directly back to farmers who use the program,” says White. “Beginning this April, farmers who have an interest-bearing advance with CCGA, will benefit from an interest rate of prime minus 0.5%.”

Through CCGA, farmers can access advances on nearly 50 field crop and livestock commodities. Farmers can apply for a cash advance of up to $100,000 interest-free and an additional $300,000 at prime less 0.5%. Combined, that amounts to $400,000 at a blended interest rate well below prime and considerable borrowing cost savings.

CCGA has implemented several changes that directly benefit farmers who use the program. “Last spring, we reduced the program administration fee, and in September we launched a new online account system that was designed with direct input from our customers,” says Dave Gallant, Director of Finance and Operations at CCGA.

“By applying in March, farmers can have their advance processed during our pre-application period, which means their advance could be approved and advance funds available to them early in April,” says Gallant. “Our first advances will be issued to farmers on Monday, April 1st.”

Farmers wanting to apply for a cash advance are encouraged to call CCGA’s Winnipeg office at 1-866-745-2256 to apply over the telephone. “Our experienced team make it easy for new customers to apply,” says Gallant. Farmers can also download an application form at CCGA’s website or existing customers can soon use the new online application system directly accessible from their online account.

For farmers who have short-term financing needs, CCGA will continue processing applications for the 2018-19 cash advance program through March. The final date CCGA can issue an advance under the current program is March 31, 2019.

CCGA represents canola farmers on national and international issues, policies and programs that impact farm profitability, and has been administrator of the Government of Canada’s Advance Payments Program since 1984.

Alberta Canola Producers 2019 Board of Directors

-

BACK ROW: Ian Chitwood, Roger Chevraux, Kevin Serfas, Wayne Schneider, Cale Staden, Dan Doll FRONT ROW: Denis Guindon, Andre Harpe, John Guelly, John Mayko, Mike Ammeter

The 29th Annual General Meeting of the Alberta Canola Producers Commission was held January 29 at the FarmTech Conference in Edmonton. Following the Annual General Meeting, the Board elected John Guelly from Westlock as the new Chair, and Kevin Serfas of Turin as the new Vice-Chair.

Alberta Canola is pleased to welcome two new directors to the Board:

  • Wayne Schneider of Nisku, replacing Renn Breitkreuz in region 6
  • Roger Chevraux of Killam, replacing Dale Uglem in region 11

No nominations were received for region 12, where Brian Hildebrand retired from the Board. Growers that are interested in representing region 12 should visit albertacanola.com/elections

The Board of Alberta Canola would like to thank outgoing directors Renn Breitkreuz, Dale Uglem, and Brian Hildebrand for all the hard work they have done on behalf of Alberta’s canola farmers.

Renn joined the Board in 2014 and served on a variety of Board committees, and represented Alberta Canola on the Canadian Canola Growers Association (CCGA) Board as well as Vice Chair and Chair of the Board.

Dale joined the Board in 2016 and served on the Grower Relations & Extension and Research committees, represented Alberta Canola on the Board of the CCGA and served as Chair of the FarmTech Planning committee.

Brian joined the Board in 2017 and served on the Research and Government & Industry Affairs committees.

Visit albertacanola.com/about for more information on the Board of Directors, the committees that guide the board, and Alberta Canola’s regions.

The mission of Alberta Canola is to support the long term success of canola farmers in Alberta through research, extension, consumer engagement, and advocacy for canola farmers.

Source: Alberta Canola

Tax Credit Rate For Alberta Canola Producers In 2018 Is 17.43 Per Cent

-

Canola growers in Alberta that do not request a refund of their check off from the Alberta Canola Producers Commission qualify for a tax credit for the 2018 tax year.

The Scientific Research and Experimental Development (SR&ED) tax credit allows canola growers to claim the tax credit for that portion of the check off paid that was used to fund qualifying research.

“The tax credit is an additional benefit for growers who pay check-off on crops like canola”, says John Guelly a farmer from Westlock, Alberta and the Chair of Alberta Canola’s research committee. “Farmers are funding research into finding solutions to agronomic issues like clubroot, while being able to capture some of that investment back at tax time.”

The tax credit rate for Alberta canola producers in 2018 is 17.43 percent. For example, if an individual grower paid $100.00 in check off to Alberta Canola in 2018, $17.43 is the eligible amount to be earned as the tax credit.

The tax credit can:

offset federal taxes owing in the current year,

  • be received as a tax refund,
  • be carried forward up to 10 years to offset federal taxes owing, or
  • be carried back 3 years to reduce federal taxes paid in those years.
  • Individual producers must file a T2038 (IND). Farm corporations must file form T2SCH31.

For more information, contact the Canada Revenue Agency or your accountant.

More information on the SR&ED tax credit can be found on the Canada Revenue Agency Website at www.cra-arc.gc.ca/txcrdt/sred-rsde

Source: Alberta Canola