Equivalent of fertilizer tariff funds added to OFCAF in federal budget; government commits $333 million to dairy innovation fund

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In its brand new budget, the federal government has set out $43 billion in new spending over six years and a predicted $40 billion deficit for the 2023-24 fiscal year (up from $30 billion projected last fall).

There are several spending programs aimed at Canadians as a whole, including more money for children’s dental health and a “grocery rebate,” the new name for another GST-rebate bump.

Grain farmers in Ontario and Quebec have been waiting to hear how the government planned to return the approximately $34 million collected in tariffs paid on Russian-sourced fertilizer, and it appears that answer is in the budget, as hinted at by Agriculture and Agri-Food Canada minister Marie-Claude Bibeau earlier this month.

Proposed in the budget is $34.1 million, over three years, added to the On-Farm Climate Action Fund to “support adoption of nitrogen management practices by Eastern Canadian farmers, that will help optimize the use and reduce the need for fertilizer.”

The federal budget also includes $333 million over 10 years, beginning in 2023, for the Dairy Innovation and Investment Fund. The fund, administered by Agriculture and Agri-Food Canada, will be used to support investments in research and development of new products that use solids non-fat (SNF) — a byproduct of dairy processing, market development for these products, and processing capacity for SNF-based products more broadly.

Dairy Farmers of Canada says it welcomes the funding for solids non-fat research and market development. “Canada has a surplus of SNF and does not currently have enough processing capacity to maximize the full value of milk. DFC is awaiting the details of the fund with great anticipation.”

Also included in the budget:

  • $57.5 million over five years, with $5.6 million ongoing, to the Canadian Food Inspection Agency to establish a Foot-and-Mouth disease Vaccine Bank to ensure early vaccination of livestock, reduce border closures and protect the livelihoods of livestock farmers in the event of an outbreak. The Canadian Cattle Association and Dairy Farmers of Canada both issued statements welcoming the creation of the FMD vaccine bank. “While we hope this vaccine bank is never needed, we are grateful for today’s investment and its establishment,” said Nathan Phinney, CCA president. “We appreciate the government listening to our concerns and understanding the critical need to put in place emergency preparedness plans to control the spread of the disease and protect our export markets for Canadian beef.”
  • $13 million in 2023-24 to increase the interest-free limit of loans under the Advance Payments Program from $250,000 to $350,000 for the 2023 program year. This appears to be in addition to the government announcement last June that it was increasing the interest-free portion from $100,000 to $250,000 for 2022 and 2023.
  • A commitment to engage with the biofuels industry in the months ahead to explore opportunities to promote its growth in Canada. “This will include an examination of different support mechanisms that could support the sector in meeting the growing demand for low emissions fuels,” the budget says. Tax credits in the U.S. government’s Inflation Reduction Act have resulted in concerns about the competitiveness of producing biofuels, such as renewable diesel, in Canada.
  • $184 million over three years, starting in 2023-24, to Environment and Climate Change Canada, Parks Canada, Fisheries and Oceans Canada, and Natural Resources Canada to continue monitoring, protecting, and promoting the recovery of species at risk to help restore their populations.
  • A commitment to begin consultations this summer on the right to repair and interoperability of farming equipment, which is being welcomed by the Agricultural Manufacturers of Canada (AMC.)
  • $27.2 million over five years, starting in 2023-24, to Transport Canada to establish a Transportation Supply Chain Office to “work with industry and other orders of government to respond to disruptions and better coordinate action to increase the capacity, efficiency, and reliability of Canada’s transportation supply chain infrastructure.”
  • $25 million over five years, starting in 2023-24, to Transport Canada to work with Statistics Canada to develop transportation supply chain data that will help reduce congestion, make our supply chains more efficient, and inform future infrastructure planning.
  • A commitment to introduce amendments to the Canada Transportation Act to provide the Minister of Transport with the authority to compel data sharing by shippers accessing federally regulated transportation services.
  • A commitment to introduce amendments to the Canada Transportation Act for a temporary extension, on a pilot basis, of the interswitching limit in the prairie provinces to strengthen rail competition.

The NDP have signalled intent to support the budget.

More to come.

Related: What’s in the 2022 budget for agriculture

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