Support for agriculture, more essential than ever!

Over the years, the Quebec agricultural sector has gone through various phases of transformation. Realities and needs change, requiring adjustments in the support provided by the federal and provincial governments. The development of these measures reflects the importance given to this vital sector.

Access to agricultural credit is one of the cornerstones of the creation of the Catholic Union of Farmers (UCC). early 20’sI century, to succeed in producing more, farmers had to go into debt, which sometimes put them in untenable situations. Debt, bankruptcy and sale of assets are reasons why farmers are migrating to cities and abandoning their farms. Farm loans offered by Ottawa are considered usurious, with interest rates so high that they trap farmers in a cycle of unmanageable debt, a cycle that leads them to bankruptcy. The federal program may be an acceptable solution for Western farmers, but it is not suited to Quebec’s reality. Fortunately, credit unions began offering agricultural loans, but they struggled to meet the significant demand and available capital was low and uneven between parishes.

What should be the nature of agricultural loan? Short-term help? A tool for long-term agricultural planning? And who should benefit from it? Should we reserve it for the youth or make it available to all? These discussions will lead to the creation of UCC and its work, as farmers want equipment that will allow them to earn a decent living from their profession.

Among the measures that have made a difference in stabilizing producers’ incomes is crop insurance (ASREC). It was Ottawa that responded to repeated requests from farmers across the country and established this type of program with the aim of protecting crops against the risks associated with climatic conditions and uncontrolled natural phenomena. Established in 1959, this program provides individual or group protection based on culture. In 1967, the Quebec government launched its own crop insurance program, thus expanding the safety net for farmers, which had been a request from the UCC in the early 1950s.

Then, Agricultural Income Stabilization Insurance (ASRA) was implemented in 1975. Its objective is to reduce the impact of fluctuations in market prices and input costs to guarantee a decent income to farmers, thereby boosting their potential growth. Business.

Other programs will be added starting on the 21stI century by both levels of government. These will evolve over time to become the Agri-Sustainability, Agri-Québec Plus, Agri-Investment and Agri-Québec programs. The first two are complementary and are intended to protect producers from declining farm incomes associated with production losses, rising costs and market conditions. Agri-Québec and Agri-Investment are two savings-based programs that allow you to create a reserve fund to better manage risks or support a development project such as transitioning to organic production.

In 2001, La Financier Agricole du Québec was created to centralize the management of financial assistance, insurance and income security. In partnership with the agricultural world, the organization simplifies the allocation of assistance to farmers, who thus know which door to knock on.

There are also a number of financial measures to help young farmers start a new farm or relocate a family business. This support is even more essential as they face conditions that are very different from those experienced by previous generations, with rising land costs, rising interest rates and inflation.

Compared to other regions of the world, agricultural support in Quebec consists largely of price support, a form that does not require public funding. According to a study conducted by the UPA on support to agricultural producers, this trend is in contrast to the international situation, where budgetary transfers (direct subsidies) play a major role.

Between 2019 and 2022, fiscal transfers, which are direct payments from public institutions to agribusinesses, declined from 43% to 34% of total support, a proportion lower than that seen in regions such as the United States (96%), the European Union is less. (87%), OECD countries (66%) and Canada (58%). According to this analysis, Quebec producers receive less support through budgetary transfers in relation to the value of their production than their main competitors.

There is still much to be done in terms of financing and supporting agriculture. At the global level, the geopolitical context coupled with increased instability as well as the persistence of impacts associated with climate change are important factors to consider. Although Quebec’s approach today offers greater stability in the face of global market uncertainties, Quebec’s agricultural producers may not receive the same direct support as their competitors. This could have an impact on their long-term competitiveness, a topic that farmers were already considering in 1924.

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