Significant funding losses face four agencies charged with helping Alberta farmers develop policies and markets for their products.
Alberta Beef Producers stands to lose $7 million from its 2009 budget of $12 million while Alberta Pork, already stinging from the effects of production cuts, expects further losses when Bill 43, the Marketing of Agricultural Products Amendment, 2009, comes into effect in April 2010.
Enacted earlier this year, Bill 43 will make it possible for farmers working within four different commodity groups — beef, pork, lamb and potatoes — to seek refunds on what has been a mandatory check-off program.
Each of the four groups, Alberta Beef Producers, Alberta Pork, Alberta Lamb Producers and Potato Growers of Alberta, receive the bulk of their funding from mandatory deductions, termed check-offs, made when farmers sell those commodities into the marketplace. Alberta Beef, for example, deducts $3 per head while Alberta Pork takes $1 per slaughter animal.
In what appears to be no less than a battle between two big bulls circling each other in one small corral, a firestorm was ignited by groups including the Western Stock Growers Association, who felt Alberta Beef — formerly the Alberta Cattle Commission — has not lived up to expectations.
In a newsletter published after the bill had passed, the Western Stock Growers discussed the formation of the Beef Industry Alliance and its role in lobbying against the mandatory check-off. Besides the Western Stock Growers, Beef Industry Alliance membership includes the Alberta Cattle Feeders’ Association, Feeder Associations of Alberta, Beef Initiative Group, Border Beef Inc. and Canadian Legacy Partners.
“The refundable check-off will ensure accountability, freedom of choice and the ability of the producer to control his property, in the form of the three dollars per head service charge. There are no losers in this situation,” said the Western Stock Growers newsletter.
Beef Industry Alliance chairman Russ Pickett, in a letter sent in May to the Agriculture Products Marketing Council, said his members are “extremely distressed with how their check-off dollars are being used against them by the Alberta Beef Producers.”
After defining the Alliance’s position, Pickett gave the Marketing Council its wish list:
1. A full accounting from Alberta Beef Producers of time and money the Beef Industry Alliance believes was spent on a campaign against the Beef Industry Alliance and the Government of Alberta.
2. A requirement that Alberta Beef Producers post the information in its annual report.
3. A contribution from Alberta Beef Producers to the Beef Industry Alliance equal to the money alleged to have been spent on the campaign.
4. A request that Alberta Beef Producers cease and desist from “wasting any more check-off money on a campaign against their members.”
Alberta Beef Producers chairman Rick Burton, in the association’s 2009 annual report, addressed Bill 43 but did not respond directly to the statements in Pickett’s letter.
Rather, he stated that Alberta Beef Producers will continue to represent producers and voice opposition to Bill 43.
“The wild ride is not over. We will continue to represent producers and voice our opposition to this legislation that removes the right of producers to choose how their organization is funded,” said his report.
Delburne-area cattle producer Doug Sawyer, chair of the Alberta Farm Animal Care Association and vice-president of finance for Alberta Beef Producers, said Bill 43 has gutted the association’s ability to perform its duties.
Sawyer anticipates that a large number of producers, given the option, will want their check-off money refunded. He said this is understandable when livestock producers are facing extremely lean times, especially in those parts of the province where pastures and hay fields failed, doubling the price of feed and leaving producers scrambling to find ways of feeding their cows over the coming winter.
Sawyer argues, however, that every $3 deducted buys 10 or more times that in benefits for producers.
Alberta Beef Producers will spend only as much as its income allows, budgeting for a shortfall of $7 million in 2010, he said.
Tees-area hog farmer Herman Simons, chairman of Alberta Pork, said those producers who ask for refunds will likely have to pay for services that were previously part of the package. That would include participation in the Canadian Quality Assurance program, mandatory for producers who want to sell into certain plants, including Olymel at Red Deer.
Alberta Pork’s income is already down from previous years because fewer pigs are being produced, said Simons.
Expectations that markets would improve in spring were cut off at the knees when the H1N1 virus was found on a farm near Rocky Mountain House.
Some farms have already been forced into bankruptcy and there is no way of knowing how long those that remain can hang on, he said. That leaves large numbers of pork producers wondering what will be left of their industry by the time April rolls around, with the refundable check-off taking another chink out of an association that is already suffering damages.
“Everybody is not doing well, I can tell you,” said Simons.
Altogether, the four associations that fall under Bill 43 represent about $3.6 billion per year in farm cash receipts, dominated by the cattle industry’s share of $3 billion, says a backgrounder provided by the provincial government.
Agriculture Minister George Groeneveld, in announcing the bill, said it’s about giving producers a choice.
“Making the check-offs refundable encourages the commissions to be responsive to their members’ needs . . . and ensures accountability.”