News Release Archive

AGRICULTURE/MARKETING--Ministers Meet to Discuss Drought

AGRICULTURE/MARKETING--Ministers Meet to Discuss Drought Relief
Agriculture and Marketing Minister Ed Lorraine met with
Agriculture and Agri-Food Canada Minister Lyle Vanclief in Ottawa
earlier this week to discuss Nova Scotia's recent drought

The dry weather severely damaged crops, resulted in feed
shortages for livestock, and left a number of producers in the
province facing financial hardship. The Nova Scotia Department of
Agriculture and Marketing estimates producers could lose $30
million to $50 million in revenues.  

In certain areas, precipitation for July and August was about 10
per cent of normal rainfall. While drought has affected many
crops, forage crops were especially hard hit. The severity of the
situation was compounded by higher-than-normal winter kill,
followed by a cold, wet spring.

"Mr. Vanclief has told me there will be no new federal resources
to draw from to help provide immediate assistance to those Nova
Scotia producers hit hard by the recent drought," Mr. Lorraine
said of Monday's meeting. "I am disappointed but am encouraged by
Minister Vanclief's commitment to explore all the options
available to him."

"I have assured Mr. Lorraine that we recognize and understand the
severe situation being faced by some Nova Scotia producers due to
this summer's historic dry weather," said Mr. Vanclief. "In an
effort to help Nova Scotia producers get through this tough
situation, we are currently focusing on what options we have to
provide assistance within our existing programs and funding."

One option the ministers discussed is the current application of
East Coast Commodities Ltd., formerly Grain and Forage Nova
Scotia, to permit hay and silage to be included in the Advance
Payments Program. The program provides cash advances,
interest-free on the first $50,000, to eligible producers of
storable, marketable crops. These loans can be used, for example,
by producers who have feed but are in short supply of their total
feed requirements. At this time, it appears hay will be a new
crop added to the program; the option to include silage is still
being examined.

In addition, officials are considering the possibility of
implementing Section 80.3 of the Income Tax Act. This would allow
livestock producers, forced to reduce their breeding herds, to
defer part of their income to the next year to offset expenses
incurred in replacing herds. An estimated 25 per cent of Nova
Scotia's breeding herd was sold this fall because of the lack of

Another option currently being explored is potential flexibility
within Nova Scotia's current safety net companion programs.

Federal officials said these options will be pursued as quickly
as possible.

Both federal and province governments are committed to the core
safety net programs of the Net Income Stabilization Account(NISA)
and the Crop and Livestock Insurance program.

To date, approximately 1,000 Nova Scotia producers are enrolled
in NISA, representing a 190 per cent increase in enrolment in the
past year. In total, these producers have contributed $8 million
to their individual accounts with the help of contributions from
both the federal and provincial governments.

NISA was developed to provide a funding reserve for producers to
draw on when net income levels fell below normal, which some
producers are experiencing because of the drought. In addition,
it is expected more than 500 producers will receive a total of
between $1.5 million and $2 million through crop insurance as a
result of reduced yields.

Within the past few months, the Nova Scotia Department of
Agriculture and Marketing has conducted a forage survey, set
aside $3 million to $7 million through the Nova Scotia Farm Loan
Board for beef producers, encouraged other producers to take
advantage of the expertise available through the board to
refinance their debt, and established a toll-free feed listing
service to match producers with extra feed with those needing
additional feed.

In addition, crop, livestock and farm management specialists have
been working with clients individually, have developed fact
sheets for producers on managing in drought conditions, and have
conducted followup interviews with producers requiring feed.
These followups have seen the number of producers needing forage
decrease in recent weeks to 38 from 52.


Contact: Brian Smith
         Agriculture and Marketing, Truro

ngr                 Oct. 29, 1997                4:00 p.m.