Livestock Insurance To Reduce Risk in Western Canada

CANADA – The Western Livestock Price Insurance Programme will not remove risk but will offer ways to manage it, says Canadian Cattlemen’s Association President Martin Unrau.

29 January 2014

2 minute read

North America

This is the reaction to a new livestock price insurance programme, coming in March, which will roll out across the western provinces of Saskatchewan, Alberta and British Columbia.

The four year pilot enables cattle and hog producers to purchase insurance on an insured price which is selected by the producer.

Premiums are funded by producers and prices are selected from available coverage levels.

This will allow producers to safeguard against unforeseeable price declines.

Farmers have been reminded insurance can be taken out from young stock through to finished animals.

Mr Unrau welcomed the announcement, adding that it was important to all cattle farmers, especially given recent pressures from outside agriculture.

“We are in the middle of a period where foreign government policy is widening the basis,” said Mr Unrau. “We have seen media issues, food safety concerns and border closures severely impact prices and basis levels.”

“The ability to manage that risk is important to cow calf producers, backgrounders and feeders.”

A similar insurance programme, the Cattle Price Insurance Programme (CPIP), has been in force in Alberta since 2009.

According to Mr Unrau, the CPIP is a ‘solid tool’ to manage risk, but this is all, risk will not disappear, he stressed.

Agriculture ministers from the three regions have welcomed the announcement. Saskatchewan agriculture minister Lyle Stewart described livestock insurance as a ‘top priority’.

They say the scheme is a product of cross collaboration between provinces and with the national government.

But, producers are also keen to have more risk tools, according to Donna Barnett of Cariboo-Chilcotin.

Speaking on behalf of British Columbia agriculture minister Pat Pimm, Mrs Barnett said: "B.C. livestock producers have expressed great interest in having more tools that help them manage their price risks and the B.C. Government is proud to have worked with our partners to deliver a western Canadian program.”

“Providing predictable and cost effective insurance products will help our cattle and hog producers manage their businesses and focus on longer term operations."

Saskatchewan Cattlemen's Association Chairperson, Paula Larson said her organisation had been pushing for federal and provincial governments to develop a price insurance programme.

She reminded producers that information will be available from provincial agricultural offices in March.

In a statement, Federal Agriculture Minister Gerry Ritz said: "This historic initiative is a great example of collaboration among federal and provincial governments and industry to strengthen risk management options for producers.

“Our Government will continue to work closely with the provinces and industry to ensure producers have access to the tools they need to grow their businesses and our overall economy."