Agricorp production insurance needs to be expanded, Ontario government & opposition politicians agree

The threat of invasive species, volatile agricultural commodity markets and an increasing frequency of extreme weather events are among the reasons to expand the list of agricultural products eligible for crop insurance under Ontario’s Agricorp, provincial politicians said Tuesday in Toronto.

“I believe that Ontario must work with agri-food producers to better manage risk through an expansion in the scope of production insurance,” said Sophie Kiwala, Liberal MPP for Kingston and the Islands, during debate on Bill 40, the Agriculture Insurance Act (Amending the Crop Insurance Act, 1996). “In helping producers deal with potentially devastating natural events beyond their control, they will be better equipped to innovate, adapt and grow the sector.”

Bill 40 was tabled last year by Jeff Leal, the province’s Liberal minister of agriculture, food and rural affairs.

Related: Ontario government could expand Agricorp production insurance offerings

If passed into law, Bill 40 would expand the list of agricultural products eligible for Agricorp coverage. Agricorp is a Guelph-based crown corporation that covers production losses and yield reductions, caused by insured losses, for vegetables, fruit and honey, forage, tobacco and perennial plants.

Agricorp’s production insurance costs are shared by the producers and the provincial government and federal governments, Progressive Conservative agriculture critic Toby Barrett said in 2014 during a debate on the bill.

With Bill 40, Agricorp coverage would expand to livestock, said Liberal MPP Arthur Potts, Leal’s parliamentary secretary, in the legislature Tuesday.

“Most significantly, we’ve heard a lot about bees and the neonics situation,” Potts said. “It’s very, very important that we can find an insurance instrument to move away from ad hoc programs in order to protect the bee farmers of Ontario. Likewise, we have the same situation with hog farmers, we have the same situation with fowl, with birds and such.”

Opposition politicians spoke Tuesday largely in favour of Bill 40.

“There are some concerns that this legislation will address – the fact that this season alone there was what they refer to in that industry as a short crop because there was the long winter last year,” said Todd Smith, PC MPP for Prince Edward-Hastings. “I know we’re all saying this winter is going on way too long, as well, although it was a shorter start, of course. There was severe damage to the wine crop, which would be, of course, the grapes. That makes an insurance product like this an absolute necessity.”

A former insurance broker – London-Fanshawe New Democratic Party MPP Teresa Armstrong – told the legislature that severe weather “can be devastating” to farmers.

“It’s extremely important that we support our farmers with the Crop Insurance Act because we know that if we don’t have food sustaining us we’re going to be in a situation where we’re going to have a crisis on our hands,” Armstrong added.

Kiwala (pictured) suggested global warming is affecting risk to the agricultural sector, adding the average temperature in the province is1.6 degrees Celsius warmer than it was 60 years ago and further warming could increase drought risk but there will also be more intense rain.

“It is hard to deny that extreme weather conditions have become part of the new norm,” Kiwala said.  “Ice storms, early frosts, late frosts, severe flooding, extended droughts, destructive winds, microbursts and other events have caused millions of dollars in damage and with ever-increasing frequency, it would seem.”

Kiwala noted some agricultural sectors can benefit from longer, warmer growing seasons.

“Potential increases in productivity, however, are all too easily offset by unpredictable negative scenarios,” Kiwala added. “For example, the trend for warmer winters is already encouraging the spread of damaging invasive species, especially insect pests and fungal diseases. Longer, hotter summers lower the natural immunity of livestock, while extreme weather events and flooding can increase the spread of infectious disease.”

Another risk for Ontario’s agri-food industry “is the highly volatile and unpredictable nature of worldwide agricultural commodity markets, usually in response to positive or negative climactic changes everywhere,” Kiwala said. “The threat of invasive species is another significant consideration. They compete with native species for food and habitat, they cost the Ontario economy tens of millions of dollars each year and put jobs in fisheries, forestry, agriculture and tourism at risk.”

In 2013, Agricorp had “more than 14,000 customers, representing five million acres and $2.9 billion in liabilities insured under the production insurance program,” Eglinton-Lawrence Liberal MPP Mike Colle said Tuesday.