Relief for livestock producers facing COVID-19 challenges

Some relief is coming for livestock producers impacted by the COVID-19 pandemic.

Agriculture Minister David Marit announced additional funding of $10 million on Thursday, to help producers manage the impacts of market disruptions related to the pandemic.

According to the province’s announcement, funding will include $5 million for Saskatchewan’s share of the costs associated with participation in the national AgriRecovery set-aside program, and includes $5 million to partially offset higher premium costs under the Western Livestock Price Insurance Program.

“Our livestock sector is under tremendous pressure, and today’s funding will help ensure our producers have the support they require during this period,” Marit said.

“With today’s announcement, the Saskatchewan government will fund the 40 per cent provincial contribution to the AgriRecovery set-aside program announced on May 5 by the federal government.  Saskatchewan livestock producers will now be able to access a total of $12.5 million in joint provincial-federal funding under the set-aside program”. 

Marit said participation in the AgriRecovery set-aside program will compensate producers for the cost of temporarily holding cattle back from market back until supply more evenly matches demand and processing capacity. Saskatchewan will consult with industry, the federal government and other western provinces to finalize the details of the set-aside program.

Saskatchewan Crop Insurance Corporation will administer the program and deliver the program to Saskatchewan producers.

Saskatchewan is also moving to address the increased cost of purchasing livestock price insurance through the Western Livestock Price Insurance Program.

Premiums have increased significantly since the end of February due to the uncertainty of COVID-19, Marit said. In response, the provincial government will “provide 40 per cent of the increased premium costs, retroactive to February 25, 2020.

In addition, the deadline for obtaining calf price insurance is being extended from May 28 2020, to June 18, 2020. The premium adjustments will be in place until Sept. 1 when the province will reassess.

Saskatchewan Stock Growers Association President Bill Huber welcomed the province’s response on WLPIP, and also called on the federal government to contribute the other 60 percent.  He noted WLPIP premiums have tripled and even quadrupled due to uncertainty from COVID-19.

“Given the situation, insuring a profitable price through WLPIP is a good business decision. Producers can’t afford not to have coverage,” said Huber in a news release. “Government assisting with premiums will make this necessary coverage more affordable.”

Huber also called the funding to the AgriRecovery set-aside program an important step. “With the COVID-19 pandemic affecting processing capacity, livestock producers are facing a serious price crunch this fall… it is already costing the cattle industry $400,000 per day to feed cattle that normally would have been processed by now, and that number is growing every day as more animals go unprocessed.

“We are concerned because negative margins in the feeding sector and a backlog of cattle will wreak havoc with calf prices in the fall. We’re grateful to the minister and the government for participating in these programs and recognizing the importance of the livestock industry.”

Other industry organizations have voiced support. “COVID-19 has had multiple effects on Canada’s cattle producers,” Saskatchewan Cattlemen’s Association Chair Arnold Balicki said in a news release from the province. 

“Industry put forth a number of recommendations to governments to address our complex industry’s challenges.  It is great to see Saskatchewan stepping up on set aside and price insurance.  These will help with the backlog and make it more affordable for producers to participate in price insurance, injecting some certainty into the coming months.”

“It is vital that we work together to address the impact of the serious challenges presented by COVID-19,” said Saskatchewan Cattle Feeders Association President Chad Ross in the province’s news release.  “We welcome the measures announced today and look forward to continuing to work closely with government and other industry partners to support producers.”