Canadian gov't announces BSE aid funding

Cattle Market & Farm Reports, Editorials
Sep 20, 2004
by WLJ
Canadian Agriculture Minister Andy Mitchell announced an aid package of almost a half a billion dollars September 10 for Canadian cattle producers devastated by the bovine spongiform
encephalopathy (BSE), or mad-cow disease, crisis.
Once consultations have been completed, Mitchell said, the federal investment will total C$488 million dollars. Analysts ahead of the announcement had been expecting new money in the area of one billion dollars.
Mitchell said he wants to return the Canadian beef industry to profitability in case the U.S. border does not re-open. However, Mitchell added the Canadian government is still committed to try and find a way to re-open the U.S. border to live cattle exports.
He said he spoke with U.S. Agriculture Secretary Ann Veneman in New York recently and talked with her again September 10 morning to discuss the new programs the Canadian government was attempting to put into place.
He said there were three facets to the new program the Canadian government was attempting to put together.
First, Mitchell said there would be funding to help increase ruminant slaughter capacity. That funding was expected to total C$66.2 million. In addition to preparing a reserve fund for infrastructure development, he said the government would establish what he termed a "one-stop shopping center" to help process infrastructure requests, information and so on.
The Canadian government was also ready to institute a series of transition measures to help Canadian farmers. The transition funding was expected to total C$384.8 million. Mitchell said there would be changes made to the Canadian Agricultural Income Stabilization Program, or CAIS, that will make advances available to put cash in the hands of producers quickly to deal
with liquidity issues.
In order to bring some balance the marketplace over the short-term, Mitchell said the Canadian government was establishing a Set-Aside program for fed cattle and feeder cattle. The Set-Aside program is being implemented to help keep cattle prices at a viable level until additional slaughter capacity is made available.
Mitchell said various advisory and management committees will work together to balance prices, slaughter rates, and other various risk factors. He said they will also be looking to find ways to efficiently deal with older cattle in Canadian herds.
Mitchell also placed a high importance on the expansion of foreign markets that Canadian cattle can be sold into. In total, C$37.1 million in federal funding for market expansion has been allocated. "We're seeking to diversify our marketplace and working to gain additional foreign markets," he said. He said the expansion of foreign markets would be facilitated by the implementation of additional scientific measures, including improvements to Canada's tracking and tracing programs, in order to make them the safest in the world.
Mitchell said there would be surveillance targets for cattle, which would be established through contact with the provinces and the industry. He added they would proceed with a long-term strategy of BSE research and the removal of specified risk material from feed materials. The program that will be implemented will consist of many component parts, Mitchell said. "The provinces can decide what they want to participate in based on their needs," Mitchell said.
Cattle producers across western Canada have said their losses have passed C$2 billion since a single case of BSE was discovered on a northern Alberta farm in May 2003.
Prior to this announcement, the federal government had divvied up more than C$950 million in BSE aid to the cattle industry.
The U.S. border is currently only open to certain cuts of Canadian beef. It is closed to live cattle exports. There has been talk recently from political officials, including Federal Conservative Party Leader Stephen Harper, that the border may never re-open to live cattle exports. — John Nelson, Dow Jones Newswires