Issue

Current business risk management (BRM) programs are not meeting the evolving needs of agriculture. Producers face increasing volatility, while gaps in program design, delivery, and education continue to limit participation and effectiveness.

Background

Canadian agriculture is becoming increasingly exposed to risk. Fewer than 1.37 percent of Canadians are farm operators, yet farms are larger, more complex, and carry substantially higher per-acre and per-animal financial exposure than in past decades. Rising input costs, labour shortages, climate-driven variability, and market disruptions have significantly increased the dollar value of risk producers must manage.

Extreme weather conditions between 2021 and 2023 revealed major gaps in BRM coverage. Many producers experienced severe margin declines that were not adequately addressed by existing programs. AgriStability’s reference‑margin limitation continues to affect roughly one-third of participants, and a 30 percent margin loss requirement effectively limits support to catastrophic situations. Industry and the Canadian Federation of Agriculture (CFA) have called for meaningful coverage, including increasing AgriStability to 85 percent of the reference margin, removing the negative‑margin viability test, and allowing automatic use of the stronger reference‑margin calculation. There is strong industry support for raising the trigger point and implementing a 10-year median average to better reflect long-term production patterns and reduce volatility in program calculations.

The livestock sector also requires updated tools. CFA and producers have identified the need to permanently include pasture and feed costs in AgriStability and to modernize livestock tax deferral rules, so eligibility is timely, area-based, and supported by updated satellite vegetation mapping. The lack of risk‑management tools for livestock purchase‑price volatility and limited support for multi-year recovery costs under AgriRecovery further weaken resilience.

Western Canadian livestock producers also continue to face volatile market prices with limited effective risk management instruments. While the Western Livestock Price Insurance Program helps with selling price risk, there remains no program to protect producers against market volatility at the time of livestock purchase.

Industry stakeholders have also identified a significant problem with crop insurance data delivery. Currently, producers receive crop insurance numbers in mid-March, with seeding beginning shortly after. Industry requires this data by Q4 of the previous year to properly consider insurance options in their crop plans and farm business planning. The current data release timeline prevents producers from making informed decisions about coverage levels and crop selection.

Current programs also require producers to establish separate businesses to differentiate between cow-calf and crop enterprises for risk management purposes. Industry is requesting the ability to separate cow-calf and crop operations without establishing two separate businesses, using their existing enterprise accounting systems. This would significantly reduce administrative burden and improve financial reporting accuracy.

In addition, mixed operations have to use separate risk management toolkits for crop and livestock operations. To further support industry needs, it would be valuable to have a unified toolkit that integrates both crop and cow-calf risk management tools to provide comprehensive farm-level risk assessment and planning capabilities.

The application of premium tax on private agriculture risk management insurance products, while exempting provincial agriculture insurance and AgriStability programs, creates an unfair competitive environment and disincentivizes producers from obtaining optimal risk management coverage.

Recommendations

The Southeast Alberta Chamber of Commerce, along with the Alberta Chambers of Commerce, recommend that the Province of Alberta and the Government of Canada:

1. Place higher priority and increased funding on crop and livestock insurance programs, with specific emphasis on climate-resilient program design and enhanced coverage options for extreme weather events.
2. Raise the AgriStability reference margin trigger point to 85% and implement a 10-year median average option to better reflect long-term production patterns and reduce program volatility.
3. Include the ability for farmers to adjust inventory within AgriStability to better reflect actual farm operations and cash flow management.
4. Develop enhanced livestock risk management programs, including the opportunity for producers to lock in ceiling prices when purchasing livestock to manage market volatility throughout the ownership period.
5. Require crop insurance data delivery by Q4 of the previous year to enable producers to incorporate insurance information into their annual crop planning and farm business decisions.
6. Provide more easily accessible, publicly available and tailored education tools for the creation of risk management strategies through options such as workshops, webinars and online sessions.
7. Allow producers to separate enterprises between cow-calf and crop operations without establishing separate businesses, utilizing existing enterprise accounting systems for improved administrative efficiency and accurate financial reporting.
8. Support mixed operations with a unified farm-level risk-management toolkit for mixed operations that combines crop and livestock risk assessment tools, providing comprehensive farm-level risk management planning capabilities.
9. Remove the premium tax on private insurance to create a level playing field in risk management options and encourage optimal coverage selection.
10. Provide better response time in assessments, claims and processing through service level agreements, ensuring adequate staffing levels and contracting third-party adjusters and verifiers where needed.
11. Continue ongoing consultations with industry and stakeholder organizations to determine improvements and solutions for all agriculture risk management options to identify barriers, streamline delivery and ensure equitable coverage across all producer types and farm sizes, including options for new cropping and diversification opportunities and sustainable agriculture practices.

Date Renewed: May 2023, February 19, 2026

Date Approved: May 2020, March 18, 2026