The Ontario government has introduced a new Risk Management Program designed to help farmers manage risks beyond their control, including fluctuating costs and volatile market prices.
Touted as the first of its kind in Ontario, the program will provide farmers, who pay a premium into the program, with financial compensation when uncontrollable incidents eat into their bottom line, in a similar fashion to insurance.
The program is based on sales and farmers will receive a payout when the market price drops below a certain level.
"The Risk Management Program promises to be an effective tool for Ontario farmers to reduce farm market price volatility,” said Bette Jean Crews, chair of the Ontario Agricultural Sustainability Coalition and president of the Ontario Federation of Agriculture, in a news release. “The Ontario government's acceptance and commitment to underwriting farm market price risk is a huge accomplishment for Ontario agriculture and signals recognition for the value to all Ontarians of a viable agricultural industry."
Program applications for grains and oilseeds farmers will be available in August, while applications for rest of the programs will be available in the fall. Premiums will be waived for participants during the 2011 transition year.