A Federal-Provincial-Territorial Initiative

Putting Canada FirstAgricultural Policy for the 21st Century

Putting Canada FirstAgricultural Policy For the 21st Century

A Federal-Provincial-Territorial Initiative

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Key elements of the Agricultural Policy Framework:

• Environment

• Food Safety and Food Quality

• Science and Innovation

• Renewal

• Business Risk Management

The Agricultural Policy Framework contains five key elements

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Environment

Environment

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Environment

Products produced in an environmentallysound manner translate into benefits

to producers and consumers

In 5 years, we will have:

• National standards for farm environmental certification

• New tools to support environmentally sound production

• Environmental farm planning

• Producers receive recognition for their environmental investments

• Consumer access to quality food produced according to the highest environmental performance standards

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On-Farm Action

PerformanceMeasurement

Knowledge &

Information

Program elements

Environment

Programs under the APF will achieve the following:

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Food Safety and Food Quality

Food Safety and Food Quality

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Program elements

• Facilitating industry adoption of Hazard Analysis Critical Control Point (HACCP)-based food safety systems, both on-farm and beyond

• Food quality — assisting in the developmentof quality process control systems

• Traceability systems which allow products to be traced backwards and forwards through the agri-food continuum

Food Safety and Food Quality

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Supporting activities

• Research to address knowledge gaps

• Enhancing collaboration among federal stakeholders

• Government recognition of on-farm food safety programs

• Government recognition and certification of food quality systems to improve market access

Food Safety and Food Quality

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Renewal

Renewal

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What is Renewal?

Renewal

Renewal is about providing farmers with:

• Assistance to develop the skills and knowledge which will help them continue to be successful

• Access to advice to help increase profitability through on- or off-farm opportunities

• Information on opportunities to help farmers improve family income and/or make informed choices about sources of income

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Proposed programming will focus on five key areas

• Canadian Farm Business Advisory Services

– a network of advisory services that provide useful information for making business-related decisions

• Support for Skills Assessment and Training

– assistance for skills development and training to help farmers make choices about the future and enable them to pursue opportunities on and off-farm

• Capturing Opportunities

– improve profitability by increasing awareness of innovations in science and technology and how to implement them

Renewal

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Proposed programming will focuson five key areas (Continued)

• Awareness

– To provide information that helps farmers make decisions about their business operation and to establish and build awareness for renewal initiatives

> Benchmark CD Rom and Web site: www.agr.gc.ca/compare

> Agricultural Services Web site: www.agr.gc.ca/ren/serv/supp_e.cfm

• Access to Capital

– To increase private sector investment and improve farmers’ profitability of obtaining debt and/or equity financing

Renewal

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Science and Innovation

Science and Innovation

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Promoting science, research and technology transfers

Science and Innovation

• Realigning public science resources

– realigning and increasing science investments sourced from outside the agriculture sector

– realigning AAFC research resources already undertaken in support of APF priorities

• Coordinating science and innovation efforts

– taking the results of knowledge from the lab to the market place and into use

• Creating a climate for innovation

– ensuring that agriculture’s innovation needs are built into the government’s innovation policies

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International

International

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The new international strategy

International

• Gaining recognition and building markets

– market research; branding; technical marketing assistance; emerging market strategies; trade specialists

• Improving market access

– trade negotiations; strategic alliances; advocacy; and consultations

• Overcoming technical barriers

– influence trade policy and rules; alliances; early warning; and market access protocols

• Enhancing international development

– research and analysis; strategic program objectives; and market development

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Implementing the new strategy

International

• 2003-04

– Value-chain roundtables

– Development of marketing strategies

– Transition from AFTP to the new international program

• 2004-05

– Full implementation

– New funding structure

– Adapt to changing market priorities

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Business Risk Management

Business Risk Management

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New program design: CAIS

Business Risk Management

• Integrated stabilization and disaster mitigation program, with larger government contributions for disasters

• Whole farm approach

• Government funds would be accessed when a need is established

• Coverage based on a “production margin”, which is larger than the pervious gross margin

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How CAIS will work

Business Risk Management

• Integrated Trigger for Stabilization and Disaster

– A producer would receive a payment when their current margin falls below their reference margin

– Funds will be accessed in a ratio determined by the degree of margin decline

– The more severe the loss, the greater government financial participation

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Costs will be shared, but borneprogressively more by governments

85%

0%

DISASTER TIER

Government funds cover larger share of loss

producer governments

NEGATIVE MARGINSCould be partly provided through

Production Insurance or Private Risk Management Tools

70%

50% 50%

30% 70%

20% 80%

STABILIZATION TIERS

Producer funds cover larger share of loss

100%

Business Risk Management

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• Depending on their own situation, the producer would request a specific level of coverage

• To access the desired level of protection, the producer would place on account the required share of funds

producer governments

85%

0%

70%

100%

Disaster TierDisaster Tier

Stabilization TiersStabilization Tiers

Business Risk Management

Producers would be able to select their coverage level, up to their entire margin

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• Producers could initially select the minimum protection option with 1/3 of their needed contribution on account

• By the third year, they would need to increase the amount on account to the minimum level

• This process could be reset after a major downturn, to ensure time to rebuild the producer’s account

governmentproducer

85%

0%

70%

100%

Business Risk Management

For affordability, farmers could initially obtain basic coverage with only 1/3 down

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One program for stabilization, disaster

Under CAIS

1/3 down gives protection and can be carried over

Can rebuild protection immediately

Designed to meet WTO criteria

Previously…

• more complex: different programs, criteria

• producers need to build accounts over time

• After a major downturn, rebuild funds over time

• Designed to meet WTO criteria

Business Risk Management

The new approach has many advantages compared to the previous program

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Production Insurance

• Governments are committed to expanding options available to more commodities

• Often this will involve building on the best of what is already available across Canada, for example:

– products based on satellite imagery, for example to estimate the yield of forage and pasture crops

– insurance that is tied to the average rainfall in a particular area

– crop value insurance that can compensate producers of perishable crops with multiple harvest dates

• Introduction of a whole farm option

Business Risk Management

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Conclusion

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Progress to date and next steps

• Negotiations on programming and implementation details are ongoing

• Programs will be implemented as they are finalized through to 2008

A Federal-Provincial-Territorial Initiative

Putting Canada FirstAgricultural Policy For the 21st Century

A Federal-Provincial-Territorial Initiativewww.agr.gc.ca/puttingcanadafirst

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