Ottawa and the provinces will unveil today a massive relief package for the beef industry that could cost up to a billion dollars or more, to help struggling ranchers and expand Canada's meatpacking sector, senior industry sources say.
Federal Agriculture Minister Andy Mitchell was to hold news conferences in Calgary, Regina and Winnipeg to announce the multi-step, multi-year plan.
The federal-provincial plan comes at the beginning of the period in which ranchers are readying to sell their calves. Without aid, many feared a total collapse of the cattle industry.
"We're pleased that they're able to move it ahead as quickly as they have," said Dennis Laycraft, executive vice-president of the Canadian Cattlemen's Association. He'll help Mitchell and provincial counterpart Shirley McClellan at the Calgary announcement.
The government will pay advances to ranchers of about $150 for each calf they promise to hold off on selling until 2006 based on a percentage of their herd, said a senior cattle-industry official who spoke on condition of anonymity.
The plan will provide loan guarantees for groups that want to build new packing plants to increase Canada's slaughtering capacity. It will organize a euthanization program for tens of thousands of aging cattle.
Many of the culled cattle will be tested for mad cow disease to help Canada meet its international requirements to screen 8,000 animals this year and 30,000 next year, the source said.
"These are animals that will likely not survive through the winter," he said. "It is not a broad-based cull."
Ranchers who surrender animals to this targeted slaughter will also be compensated.
The pivotal component of the plan is aid for calf producers. Many farmers feared prices for young cattle would fall through the floor, with the industry near its lowest level since the crisis began. Tens of thousands of Canadian ranchers rely on the fall calf run for about 75 per cent of their annual income.
Last fall many ranchers were optimistic the U.S. border would re-open to live cattle, giving bounce to the struggling industry. Even the cheeriest of industry leaders say trade won't resume until well into 2005.
Federal Conservative Leader Stephen Harper predicted it would take longer than that, due to U.S. protectionist groups and lukewarm relations between the two countries.
The cash comes at a crucial time for struggling ranchers like Keith Porter.
"It's tough to have enough money just to pay our bills," said Porter, who farms near Duffield. "If we hadn't been around for the last four generations . . . some young farmers that are starting up got really large debt load."
Porter complained about selling a 2,450-pound bull to a slaughterhouse for 12 cents a pound, a fraction of what he would have got.
The plan will cover older animals through cash advances under an existing income-stabilization fund.
The aid for calf producers will give them incentive to hang onto their cattle for months or years until the border re-opens, prices rebound or there's enough slaughterhouse capacity in Canada to handle them.
Dozens of investor groups have drawn up plans to build new packing plants or update existing ones, but have had trouble securing the millions it costs, and the municipal approvals needed to do so.
The government plan will help investors secure loans for the plants. The goal is to have enough capacity to slaughter all market-ready cattle in Canada by 2006.
It would reduce pressure on the need to open the border and ease the stranglehold on the industry that U.S.-owned Cargill and Tyson plants enjoy.
The slaughterhouse money will assist small and medium-sized plants and startups, a move that pleases Grant Hirsche, one of the leaders of the Beef Initiative Group that wants to build a large producer-owned abattoir in Alberta.
"The taxpayer will come unglued if this is an aid package that allows Cargill or (Tyson) to get this," Hirsche said.
The package is almost identical to a contingency plan released last month by the Canadian Cattlemen's Association. It was drawn up after weeks of negotiations between farm-group leaders and federal and provincial negotiators.
For the first time since June 2003, Ottawa will release a relief package with the co-operation of the government of Alberta, Canada's largest cattle-producing province.
"Alberta is on line with the federal government and its plan to assist our industry," said Terry Willock, spokeswoman for McClellan, the provincial agriculture minister.
An Ottawa-driven plan to bail out farmers was released in November.
Federal Agriculture Minister Andy Mitchell was to hold news conferences in Calgary, Regina and Winnipeg to announce the multi-step, multi-year plan.
The federal-provincial plan comes at the beginning of the period in which ranchers are readying to sell their calves. Without aid, many feared a total collapse of the cattle industry.
"We're pleased that they're able to move it ahead as quickly as they have," said Dennis Laycraft, executive vice-president of the Canadian Cattlemen's Association. He'll help Mitchell and provincial counterpart Shirley McClellan at the Calgary announcement.
The government will pay advances to ranchers of about $150 for each calf they promise to hold off on selling until 2006 based on a percentage of their herd, said a senior cattle-industry official who spoke on condition of anonymity.
The plan will provide loan guarantees for groups that want to build new packing plants to increase Canada's slaughtering capacity. It will organize a euthanization program for tens of thousands of aging cattle.
Many of the culled cattle will be tested for mad cow disease to help Canada meet its international requirements to screen 8,000 animals this year and 30,000 next year, the source said.
"These are animals that will likely not survive through the winter," he said. "It is not a broad-based cull."
Ranchers who surrender animals to this targeted slaughter will also be compensated.
The pivotal component of the plan is aid for calf producers. Many farmers feared prices for young cattle would fall through the floor, with the industry near its lowest level since the crisis began. Tens of thousands of Canadian ranchers rely on the fall calf run for about 75 per cent of their annual income.
Last fall many ranchers were optimistic the U.S. border would re-open to live cattle, giving bounce to the struggling industry. Even the cheeriest of industry leaders say trade won't resume until well into 2005.
Federal Conservative Leader Stephen Harper predicted it would take longer than that, due to U.S. protectionist groups and lukewarm relations between the two countries.
The cash comes at a crucial time for struggling ranchers like Keith Porter.
"It's tough to have enough money just to pay our bills," said Porter, who farms near Duffield. "If we hadn't been around for the last four generations . . . some young farmers that are starting up got really large debt load."
Porter complained about selling a 2,450-pound bull to a slaughterhouse for 12 cents a pound, a fraction of what he would have got.
The plan will cover older animals through cash advances under an existing income-stabilization fund.
The aid for calf producers will give them incentive to hang onto their cattle for months or years until the border re-opens, prices rebound or there's enough slaughterhouse capacity in Canada to handle them.
Dozens of investor groups have drawn up plans to build new packing plants or update existing ones, but have had trouble securing the millions it costs, and the municipal approvals needed to do so.
The government plan will help investors secure loans for the plants. The goal is to have enough capacity to slaughter all market-ready cattle in Canada by 2006.
It would reduce pressure on the need to open the border and ease the stranglehold on the industry that U.S.-owned Cargill and Tyson plants enjoy.
The slaughterhouse money will assist small and medium-sized plants and startups, a move that pleases Grant Hirsche, one of the leaders of the Beef Initiative Group that wants to build a large producer-owned abattoir in Alberta.
"The taxpayer will come unglued if this is an aid package that allows Cargill or (Tyson) to get this," Hirsche said.
The package is almost identical to a contingency plan released last month by the Canadian Cattlemen's Association. It was drawn up after weeks of negotiations between farm-group leaders and federal and provincial negotiators.
For the first time since June 2003, Ottawa will release a relief package with the co-operation of the government of Alberta, Canada's largest cattle-producing province.
"Alberta is on line with the federal government and its plan to assist our industry," said Terry Willock, spokeswoman for McClellan, the provincial agriculture minister.
An Ottawa-driven plan to bail out farmers was released in November.
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