Agri-info Newsletter – May 2015
Table of contents
Changes to the Advance Payments Program - a better fit for your business
The Advance Payments Program (APP) is a federal loan guarantee program that helps agricultural producers benefit from the best market conditions by improving their cash flow throughout the year.
The APP works by enabling producers to access an advance of up to 50% of the expected average market price of their agricultural product for up to 18 months. These advances can be up to $400,000 with the first $100,000 interest free!
Recent amendments introduced with the Agricultural Growth Act have allowed for changes to the Advance Payments Program.
Some of these amendments came into effect on April 1, 2015, just in time for spring production. These changes also include reducing the paper burden for producers by allowing a single administrator to provide advances on multiple commodities.
Flexibility has been added to the program by adjusting the rules around the repayment of advances. For example, a repayment schedule has been added that is more in line with the perishable date of non-storable products, eliminating the need for proof of sale. Similarly, proof will no longer be required when repaying the advance, if the producer can demonstrate that the commodity has not been sold.
Also, the need to provide proof of sale has been removed in instances where the agricultural product becomes unmarketable through no fault of the producer.
Finally, the requirement to be principally occupied in farming has been removed. This means that individuals with off-farm employment will now be eligible to receive advances for their farm products.
Further changes to the APP will be rolled out once amendments to the existing regulations are in place.
Some of the improvements include:
- New commodities being eligible for advances including specific classes of breeding animals intended for market.
- More options for producers to secure an APP advance.
- A new, more efficient application process to reduce paper burden and treat farmers like returning clients.
- A streamlined approach to obtaining guarantees for companies with many members.
Farmers work smarter with help from unmanned aircraft
The commercial use of unmanned air vehicles (UAVs), sometimes called drones, has taken off — literally!
Over the past four years, Transport Canada has seen a more than 2,000% increase in requests for commercial permits to fly UAVs, mostly for taking aerial photos. But because many Canadians don’t realize they may need special permission to fly, the actual number of UAVs in use is likely much higher than these permits indicate.
The agriculture industry began using UAVs to survey fields, but now also uses them for a variety of applications, including measuring the effects of wind and weather, conducting precision crop spraying, and gathering data such as soil patterns.
This information can help farmers improve crop health and increase yield.
You may need permission to fly.
You are responsible for flying your aircraft safely and legally. If you are using a UAV to support your agricultural operations, you may need to apply for a Transport Canada Special Flight Operations Certificate (SFOC). The process allows experts to review your specific situation and determine if extra precautions are needed.
If your unmanned aircraft weighs less than 25 kg, you may qualify for an exemption that would allow you to fly without a SFOC. To find out:
- Read Flying an unmanned aircraft (external PDF) infographic
- Learn about the conditions you must meet to qualify for an exemption on the Safety First website.
- If you do not meet all exemption conditions, you must apply for a SFOC.
For more information, visit Transport Canada’s Safety First website.
Future of farming growing stronger
From driving the economy and creating jobs, to becoming a world leader in producing high-quality agricultural products, Canadian producers have a lot to be proud of. Agriculture and Agri-Food Canada (AAFC) recently released two reports showcasing the importance of the sector and the positive future it has.
The 2015 Canadian Agricultural Outlook, released in February 2015, provides a forecast for the agricultural sector for the previous and current calendar years (2014 and 2015) and looks ahead 10 years based on the most current information available.
Key highlights from this year’s report include:
- Aggregate net cash income for 2014 is expected to reach $14 billion, 10% above the 2013 record. For 2015, farm incomes should remain historically high at $13 billion.
- Farm-level net operating income in 2014 is forecast to be $78,139, also an all-time high.
- Average net worth per farm is expected to set new records of $2 million in 2014 and $2.1 million in 2015.
- Exceptional market incomes over the past several years have contributed to lower program payments in 2014 and 2015 compared to previous years.
- The cattle and hog sectors enjoyed record prices and higher incomes in 2014 due to low North American supplies and weakening feed grain prices. Although total livestock receipts will not change significantly in 2015, cattle receipts will continue to benefit from tight markets and higher prices.
- In the latter part of 2014, grain and oilseed prices declined, but Canadian sale volumes remained strong partially offsetting these lower prices. Farmers carried forward a large portion of their record 2013 crop into 2014, which also had a larger than average harvest. Global prices are projected to increase over the medium term.
The Overview of the Canadian Agriculture and Agri-Food System 2015, released in April 2015, uses the latest 2013 data to present the sector in the context of the Canadian economy and international markets.
Some ways agriculture plays a vital role in keeping Canada’s economy strong:
- The agriculture and agri-food sector generated $106.9 billion in 2013, accounting for 6.7% of Canada's gross domestic product.
- In 2013, the agriculture and agri-food sector provided one in eight jobs in Canada, employing over 2.2 million people.
- Canadian export sales grew by 5.5% in 2013 to $46 billion, maintaining its 3.5% share of the total value of world agriculture and agri-food exports. Canada remained the world's fifth largest exporter of agriculture and agri-food products in 2013.
- Exports to the United States (U.S.) increased by 10.8% in 2013 to $23.4 billion, while exports to non-U.S. markets grew by 6% to $22.7 billion. Exports to China, which grew by 84% in 2012, continued to climb by 3.5% in 2013.
- Public investments in research and development are estimated to rise by 5.3% to $643 million in 2013-2014.
Canadian agriculture is growing strong. Support for research, innovation and increased access to new market opportunities means growing success for producers and the Canadian economy.
To request a copy of the 2015 Canadian Agricultural Outlook or the 2015 Overview of the Canadian Agriculture and Agri-Food System report, please visit Publications - Agriculture and Agri-Food Canada.
Mesh netting keeps cabbage maggots at bay
New field research by Agriculture and Agri-Food Canada (AAFC) has found that mesh netting is a workable alternative to pesticides in protecting larger-scale commercial brassica crops from cabbage maggot damage. Just like a screen door keeps insects out of the house in summer, this netting helps protects crops by keeping cabbage maggots away.
A field study this past summer on a rutabaga crop at Brookfield Gardens on Prince Edward Island resulted in virtually 100 per cent protection from the maggot. The fine mesh prevents the cabbage maggot fly from laying eggs at the base of the stem of the brassica crops where it feeds and destroys the plant.
Matt Dykerman, who manages the organic crop at Brookfield Gardens, was pleasantly surprised by the results.
“We were really impressed with the control the netting provided,” said Mr. Dykerman. “We grew about two acres of rutabagas under the net and had a small control plot beside it. Virtually everything in the control plot was destroyed, but underneath the netting we found very little damage at all from the cabbage maggot.”
The netting is spread over the field early in the growing season with a tractor that pulls the mesh from a large spool. A 12-metre by 100-metre field can be covered in as little as two hours. In order to be effective, it is recommended that the edges of the mesh be buried to prevent gaps that could allow cabbage maggot flies to get in.
Depending on the model, the cost of the netting application /retrieval unit is between $6,000 and $8,000. A roll of netting, measuring 12 metres by 100 metres, is about $2,000 and can be reused for several years. Selecting a field with no brassica crop residue from the previous year is important when using the mesh as it will not protect the crop if the cabbage maggot has overwintered in the soil.
Weeding can be done mechanically after removing the netting briefly and then reinstalling, or with a post-emergent herbicide applied through the cover. In areas prone to a lot of weeds, the mesh is better suited to short-season crops like broccoli and cabbage. The key is to use this material on fields with lower weed populations if possible. “The netting is durable, reusable and fairly easy to put down,” said Scott Anderson, the AAFC employee responsible for technology transfer and project co-lead. “Right now there is nobody in Atlantic Canada using it on a large scale, but if we can demonstrate through a project like this that the equipment enables multi-year use of the mesh on larger fields, it makes this kind of pest control cost effective. Then, I think you will see a wider adoption in the region.”
Two types of equipment are being used in the trial; one is manufactured in Sweden and available through a dealer in Quebec, and the second is from the United Kingdom (UK). Research with this technology has been underway for several years in Newfoundland, New Brunswick and British Columbia (BC). This was the first test of the equipment on Prince Edward Island, and plans are underway to run a trial of this system in Nova Scotia this summer.
To learn more about the use of mesh netting as an alternative to pesticides, please contact Peggy Dixon, project lead (research) AAFC, at (709) 772-4763 or firstname.lastname@example.org or Scott Anderson, project co-lead (technology transfer) AAFC, at (902) 370-1369 or email@example.com.
Grain movement in Canada improving
Every year, Canadian grain farmers export 44 million tonnes (MMT) of high-quality grains worth $18 billion to markets around the world. To reach these markets, farmers need a reliable rail system here at home.
Since the implementation of the Fair Rail for Grain Farmers Act (Bill C-30), more grain is moving, and deliveries are picking up domestically as well as to the U.S. The Grain Monitoring Program shows that rail car unloads at port terminals are up 14% over last year and up 17% over the five-year average. Shipments out of port are also up – 27% over last year and 26% over the five-year average.
These numbers apply to the sector as a whole, but improvements are also needed within specific supply chains. With Agriculture and Agri-Food Canada’s support, the Ag Transport Coalition (ATC) is helping individual shippers make more informed business decisions by reporting on actual car order fulfilment for each corridor. This supplements the Grain Monitoring Program, which tracks and monitors all aspects of the movement of grain grown in Canada from farm gate to port, and now provides enhanced monthly reporting, which will fulfill the government’s commitment to provide more timely updates on the state of Western Canadian grain transportation.
For the long term, the review of the Canada Transportation Act (CTA) is currently underway, focusing on structural issues affecting all rail transport, including grains. Both the ATC’s and the Crop Logistics Working Group’s work will play an important role in the findings and recommendations of this review. The CTA Review Panel’s final report is due to the Minister of Transport in December 2015.
The 2014 harvest was just over 60 MMT, less than 2013’s record 76 MMT crop, which should help ease current logistical concerns. However, industry and government continue to invest in research and innovation to improve agronomic practices and crop quality and increase yields. Improvements being made to the supply chain will help to ensure it has the capacity to deliver the increasing supply of grains to Canadian tables and put revenues in the pockets of farmers.
Learn more about initiatives supporting crop producers.
Canada continues to grow agri-food and seafood exports around the world
The demand for Canadian agri-food and seafood products remains strong worldwide and across sectors. Over the last ten years, exports have increased by approximatively 85%. In 2014, exports were up 12% from 2013, an all-time record that saw $56.5 billion shipped to 203 markets.
Canada’s top exports in 2014 were wheat, canola seed, fish and seafood, pork, canola oil, pulses, soybeans and beef. The top markets included the United States (52.3%), China (9.3% / plus 1.6% to Hong Kong), Japan (7.2%), the European Union (6.6%), Mexico (3%) and India (1.6%).
In 2014, Canadian beef exports were up by nearly 46%, reaching 68 markets for a total value of $1.9 billion. Wheat was also up 19.1% ($7.95 billion) and pulses were up 14.3% ($3.16 billion).
Market access issues that hold the most growth potential for the Canadian industry will continue to be prioritized, including the following ones which were key accomplishments in 2013-2014:
- Permanent access for British Columbia fresh cherries to China, worth up to $20 million annually. Trial exports of B.C. fresh cherries to China in 2014 reached $10.9 million.
- Secured access for timothy hay to China, which industry estimates to be worth $8 million over the next five years.
- Expanded access for bone-in beef to Taiwan, worth potentially $10 million annually.
- Market access to Ukraine for purebred sheep and goats.
- Full market access for beef and pork to Honduras. This restored access is estimated by industry to have a combined market value of approximately $5 million to $7 million annually, with the majority of exports expected to be pork.
- Market access for sheep and goat genetics from Canada to Brazil, a market the industry estimates to be worth approximately $1.5 million to $2 million annually.
- Full access for beef to Jamaica, estimated to be worth roughly $4.5 million annually.
Find out more at Agriculture and Agri-Food Canada Market Access.
Using research drones to increase potato production
Agriculture and Agri-Food Canada scientists in Atlantic Canada are taking crop surveillance to new heights by utilizing an innovative tool to be their eye in the sky: drone technology. A collaborative effort between government, producers and industry to improve potato yields, this technology is used by scientists to study more than 1,000 acres of potato production in New Brunswick. Providing an alternative view to identify issues and analyze images accurately and quickly, this specialized camera will help producers mitigate problems and get a consistent crop year to year. The results will help producers remain competitive in a market where the sky is the limit.
Learn how drone technology is advancing crop surveillance by watching the Using Research Drones to Increase Potato Production video.
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