Ontario increases AgriStability compensation margin

The Ontario government is increasing its contribution to the compensation rate for AgriStability.

The move goes against the national consensus that was reached in March over the removal of the reference margin limit. However, a federal government proposal to increase the compensation rate from 80 per cent to 70 per cent was rejected by Prairie provinces.

It’s the provincial portion of the increase in compensation rate that Ontario announced on July 25 that it is providing. It called on the federal government to contribution its portion.

Why it matters: Use of the AgriStability program has been declining as farmers have found it too difficult to trigger a program payout during a crisis.

“Ontario farmers can’t wait any longer for improvements to the AgriStability program – so the Ontario government is taking action and also calling on the federal government and other provinces to step up as well,” said Lisa Thompson, minister of Agriculture, Food and Rural Affairs. “By enhancing the AgriStability program, we can better help those Ontario farmers who have been impacted by large income losses from factors outside of their control.”

AgriStability is paid into both by farmers and provinces and the federal government and aims to help provide a financial backstop when farm incomes drop quickly.

The $25 million in increased potential support through AgriStability is in addition to $50 million the province announced in July 2020, to increase its contribution to the Ontario Risk Management Program.

Extreme price volatility and processing slowdowns dramatically impacted our industry in 2020,” said John de Bruyn, Chair of Ontario Pork. “This change will help the most affected producers recover. We continue to urge the Federal Minister of Agriculture, Marie-Claude Bibeau to find a way to match these funds.”

“By choosing to increase the compensation rate from 70 per cent to 80 per cent on the provincial portion of approved AgriStability claims, more money will be paid out to the producers who need it most,” said Peggy Brekveld, president of Ontario Federation of Agriculture.