Policy Issues & Articles

Under the policy portfolio, SaskCanola works collaboratively with other organizations and government agencies to ensure there is a positive regulatory environment for Saskatchewan producers to operate in.

In order to manage policy issues, SaskCanola staff and board work closely with the two national canola organizations (Canadian Canola Growers Association and Canola Council of Canada) to advance federal policy issues for farmers and the broader canola industry. SaskCanola also communicates directly with the Saskatchewan Ministry of Agriculture on regional issues that fall under provincial jurisdiction.

Please contact Tracy Broughton, Policy & Producer Relations Manager, for more information.

SaskCanola’s Position on Policy Issues:

Agriculture Policy Framework

For the past number of years, the federal government organizes a major 5 year investment in agriculture through the Agriculture Policy Framework. These frameworks are often based on the same theme areas of research and innovation, business risk management, and strategic initiatives in other common industry concern areas. The current Growing Forward program is scheduled to expire on March 31, 2018 and SaskCanola continues to be actively involved as these conversations with government progress.

  • Business risk management programming is necessary to help farmers manage market and weather volatility;
  • More flexibility is needed to allow farmers to choose insurance and risk management options that will fit their individual farm operations;
  • SaskCanola uses public research funding to leverage farmer dollars for investment in the future of the industry for canola, agriculture, and the economy;
  • Market access is critical to the success of the canola industry with 90% of canola and its products destined for export markets;
  • SaskCanola supports the other theme areas of environmental sustainability and climate change, value-added and food processing, and public trust.

SaskCanola encourages the federal government investment in the future of the agriculture industry through the Agriculture Policy Framework, particularly in areas of research funding, market access support, and business risk management programs.

Last updated on Tuesday, August 22, 2017 

Bayer & Monsanto Merger

Bayer and Monsanto have entered into a purchase agreement, bringing together the two largest canola seed suppliers in the Canadian market. Though these types of deals bring efficiencies to the market, however there is potential for this deal to result in one company holding substantial market power of the crop input industry. 

SaskCanola has raised these concerns with the Competition Bureau:

  • The lack of competitive pressure could potentially increase crop input prices, reduce product choices, and limit future innovation of the canola crop;
  • It is important to ensure our international export markets are not negatively impacted with this type of deal;
  • Uncertainty with off-patent products and international regulatory approvals.

The canola sector has the potential to be significantly impacted by a Bayer-Monsanto merger as the new corporation would control roughly 95% of the canola traits and 70% of the seed sales in Canada.

Last updated on Tuesday, August 22, 2017 

Canada-China Bilateral Trade Negotiations

The federal government asked the Canadian public and interested stakeholders to assist in defining Canada’s interests in a possible free trade agreement with China, and determine ways of maximizing the economic and social benefits of such an agreement.

SaskCanola communicated the needs of the canola sector to the federal consultation:

  • Permanent solutions are needed to address the Chinese industry about risks related to blackleg in canola;
  • Tariffs need to be eliminated for Canadian canola destined for China;
  • Any agreement with China should improve transparency and predictability with respect to feed and food safety requirements;
  • The biotech approval process needs to be streamlined between the two countries to ensure Saskatchewan farmers have timely access to new innovations in canola seed.

China is Canada’s second largest single-country trading partner and a key market for canola, and therefore a free trade agreement presents many opportunities for Canada.

Last updated on Tuesday, August 22, 2017 

Canadian Grain Commission – User Fees and Fund Surplus

The Canadian Grain Commission (CGC) is required by legislative mandate to review the User Fees on a regular basis. In addition to a scheduled review of the fees, the government consulted with grain producers, farm groups, licensed grain companies, and industry associations on the most appropriate way to use surplus funds which had accumulated to $107 million. The surplus accumulated since implementing a cost recovery model for all services during the last User Fee Review in 2012.

SaskCanola provided feedback on behalf of Saskatchewan canola producers:

  • An interim fee reduction for the next 5 year cycle for outward weighing and inspection in order to draw down the surplus;
  • The entire overage be directed to user fee reduction for the period of 2018-2023;
  • Encourage the CGC to move toward a balanced budget based on realistic operational costs and grain export volumes to avoid future accumulations of surplus funds;
  • Other options proposed by the CGC, though important, would require additional public funding due to the broader public good involved.

SaskCanola supports a reduction in user fees for grain handling and inspection because it will increase farm profitability.

Last updated on Tuesday, August 22, 2017 

Carbon Pricing

The climate change policy of the federal government includes the introduction of carbon pricing with a carbon tax or cap and trade system. Initially this was to be implemented by on the provincial level, however the Saskatchewan government has declared they will not impose a carbon tax in Saskatchewan. 

The federal government proposed backstop legislation for those jurisdictions which will not have a provincial carbon pricing system consistent with the federal benchmark by their initial deadline of 2017. 

SaskCanola provided feedback on behalf of Saskatchewan canola producers:

  • Carbon pricing will increase cost of production through increases in the cost of fertilizer, fuel, pesticides;
  • Grain transportation, which is already a significant indirect cost back to farmers will increase as a result of a carbon tax;
  • Grain producers in Saskatchewan have been implementing environmentally sustainable practises for decades through minimum tillage, which provides a carbon sink in the soil;
  • The grain industry in Canada is a trade sensitive industry and the implementation of a carbon tax will result in Canadian farmers being less competitive than producers in other countries.

SaskCanola does not support any form of carbon pricing (tax or cap and trade). In the event one is imposed, producers should be recognized financially through their contribution to the reduction of greenhouse gases by sequestration of carbon.

Last updated on Tuesday, August 22, 2017 

Component Pricing

Farmers should receive the most value possible from their crop. Questions often arise about whether the current marketing system achieves highest profitability, or if a system where grain buyers paid for canola seed based on oil content. In an effort to understand what will benefit canola producers of Saskatchewan, SaskCanola assessed the situation with a full economic analysis:

  • Weather and length of growing season have significantly more impact on oil content than management practices;
  • The canola market is currently very efficient and increasing complexity will add (transaction) costs to the system;
  • A baseline would be set with both premiums and discounts to manage the range in oil content; and,
  • Major export markets are very price sensitive so any premiums would cause them to choose a substitute such as palm or soybean.

SaskCanola supports the current marketing system for canola. Individual producers are always encouraged to explore opportunities to gain more value from their crop by way of talking to their grain buyer to seek premium prices for higher oil content.

Last updated on Tuesday, August 22, 2017 

Deferred Cash Purchase Ticket

The Federal Finance Department announced a consultation on removing the income deferral available to farmers in the form of deferred cash purchase tickets for delivery of certain grains. A significant number of Saskatchewan farmers rely on the deferred tax option to manage cash flow for tax purposes from one year to the next. 

SaskCanola provided feedback to the federal government on behalf of canola producers:

  • Given the volatility of commodity markets, SaskCanola asked the federal government to maintain the deferral program as an important management tool for balanced cash flow;
  • The programs removal could significantly impact farm sustainability from an economic and financial perspective.

SaskCanola supports the deferred tax program in the form of offering deferred cash purchase tickets for sales on eligible grains.

Last updated on Tuesday, August 22, 2017 

North American Free Trade Agreement (NAFTA) Re-negotiations

As a result of US President Trump request to re-negotiate NAFTA, the federal government has been seeking feedback from industry. The United States and Mexico are both key markets for canola seed, oil, and meal and it is critical that we maintain tariff free access. The United States and Mexican governments would like to complete seven rounds of negotiations by December 31, 2017. The Canadian government has stated they would like to see beneficial modernizations of the agreement for the North American economy, and are not as concerned with a short timeline.

During a roundtable with the provincial Ministry of Agriculture, SaskCanola shared the canola perspective:

  • The United States market was worth $3.6 billion to the canola industry in 2016 with 90% of meal and 60% of seed purchased;
  • Mexico is the fourth largest canola market at $826 million;
  • There are opportunities under a NAFTA re-negotiation to streamline regulatory processes among North American partners, and increase access to canola products under the NAFTA Rules of Origin.

SaskCanola supports free trade, open market access is critical to canola exports and farmers’ competitiveness, especially with the United States.

Last updated on Tuesday, August 22, 2017 

PMRA Re-evaluation Decision on Imidacloprid (Neonicitinoid)

The Pest Management Regulatory Agency (PMRA) invited the public to submit written comments on the proposed re-evaluation decision for imidacloprid. The re-evaluation program is an ongoing process to ensure pesticides are reviewed every 15 years using modern assessment techniques and new scientific information to ensure the products are safe to use. Concern was raised with the limited data set used to reach a decision to phase out imidacloprid. 

SaskCanola raised this concern with the PMRA, along with other industry groups on a provincial and national level:

  • A request was made to extend the timeline for the submission of additional data to fully assess the product in multiple ecosystems;
  • Canada should maintain an evidence-based decision making model to guide the regulatory process;
  • There is concern that if decision making does not follow protocols based on scientific practises, this will occur during the review of other products;
  • Canola producers rely on neonicotinoid seed treatments as safe and effective products to guard the crop against harmful pests (particularly flea beetles) in the spring as part of a targeted integrated pest management plan;
  • In the absence of these seed treatments, agronomic practises to control flea beetles may be both harmful to farmers’ health and the environment.

SaskCanola supports a regulatory system which is predictable with decisions based on good scientific practises.

Last updated on Tuesday, August 22, 2017 

Tax Planning Using Private Corporations: Impacts on the Family Farm

The federal government announcing changes to the Income Tax Act which targeted “high income individuals gaining tax advantages” could also have impacts on middle class business owners, like farmers through adjustments to:

  • Income sprinkling: the ability to divert income to family members such as providing a spouse or children a farm income will be subject to a new reasonability test;
  • Passive investment income: holding mutual funds or stocks within the farm subject to a lower tax rate than personal income tax rate, which could impact a farmer’s ability to draw financial investments from the farming corporation as a personally funded pension, benefits, or income security;
  • Capital gains exemption: elimination of the ability to multiply the Lifetime Capital Gains Exemption to all family members in a trust, and therefore limit the exemption to the first $1,000,000. 

To respond to the government on behalf of farmers, SaskCanola provided written comments through the public consultation. We worked with the Canadian Canola Growers Association and others to develop a comprehensive list of considerations for the government. To review the written comments submitted on behalf of Saskatchewan canola producers, please click here. Our recommendations included:

  • Provide more time for analysis;
  • Ensure exemptions continue for farm property and farm income as they currently exist within the Income Tax Act;
  • More detail on the ‘reasonability tests’ for income sprinkling and reflect the seasonal nature of farming;
  • Exempt the sale of Qualified Farm Property under the Lifetime Capital Gains Exemption to ensure the sale of farmland to family will continue;
  • Define passive income more precisely and allow farmers to continue to use capital in their business to fund their retirement.

As the government continues to announce changes on the tax file, SaskCanola will update farmers on how the impacts might relate to the agriculture industry. 

That being said, each farm is unique so we are encouraging farmers to:

  1. Talk to your advisor to understand how this may impact your family and your operation;
  2. Contact your MP and Liberal MPs to make them aware of your story.

To find the contact information for your MP, click here and enter your postal code. If you choose to email, please copy the Minister of Agriculture. and the Minister of Finance.

Last updated on Monday, October 16, 2017