Good morning, everyone. Chair and members, thank you for the opportunity to appear today.
My name is Tyler Fulton. I ranch with my family near Birtle, Manitoba. I'm proud to be the current president of the Canadian Cattle Association. Through our provincial members, CCA represents about 60,000 beef producers across Canada.
Strengthening the Canadian beef industry as a competitive sector for growth is critical to advancing Canada's trade diversification and food security goals. That begins by growing the national cow herd. After several years of contraction, we're beginning to see early signs of rebuilding, up to an estimated 2.5% nationally.
While that's encouraging, it remains fragile. This is why we need to ensure that government policies across departments continue to encourage growth. For example, in the government's current fast-paced trade diversification agenda, we need to ensure that trade outcomes signal growth for the Canadian economy.
Canada's current negotiations with Mercosur illustrate our concern. For Mercosur, beef access is the number one negotiating goal at the negotiating table, which would expose and undermine Canada's domestic market at a time when the Canadian beef herd is rebuilding. For Canadian beef producers, that's not diversification; it's risk without reward.
Rebuilding a cattle herd is a multi-year, capital-intensive decision that depends on policy certainty and effective risk management. Addressing inequities for the cattle sector in the business risk management suite and through the next policy framework will play an important role in whether the herd growth momentum continues or stalls.
With the next framework not starting until 2028, FPT governments should act now. Waiting will delay benefits to cattle producers until the 2029 calf crop.
Market and trade volatility continue to be significant risks. Livestock price insurance is the only program that allows beef producers to proactively manage price risk. It's particularly important for cow-calf producers who are making herd expansion decisions and for young and new producers who are most exposed to price shocks. However, high premium costs driven by increased market volatility are limiting uptake at the very time producers need this tool most. Unlike crop insurance and U.S. cattle producers, Canadian cattle producers do not benefit from a cost-shared premium.
CCA has been a long-time advocate of cost-shared LPI premiums and of making it a permanent program. This would level the playing field while reducing the reliance on other BRM tools. This is the fifth policy framework where governments have had the opportunity to address this gap.
Weather risk and rising input costs remain significant challenges. AgriStability continues to play an important role when producers face major income declines due to market disruptions, cost pressures or climate change challenges like drought. We welcome recent improvements to AgriStability, with the addition of pasture-related feed costs as an allowable expense, to make the program more responsive for cattle producers.
However, the current payment cap still limits effectiveness, particularly for the feedlot sector and other mid-large-scale operations that are driving growth, export capacity and investment across the sector and in their communities.
CCA recommends increasing the payment cap to $15 million, eliminating the cap in the event of a catastrophic disruption such as foreign animal disease outbreaks and enhancing the trigger to 85% of the reference margin. Strengthening the program will ensure that it provides a reliable backstop that supports resilience and reinvestment.
We were also pleased to host AAFC officials at our AGM in March to present their report on the feasibility of whole-farm revenue insurance for the cattle sector. We appreciate the engagement and look forward to exploring this possibility and keeping those lines of communication open.
In closing, growing Canada's cattle herd is essential to advancing shared objectives under the next policy framework. Realizing this potential will depend on a business risk management suite that is not only effective, but also equitable to reflect the realities of Canada's cattle producers.
Thanks. I look forward to your questions.