The Government of Alberta has declared 2014 an agricultural economic hardship as a result of extreme weather.
Verlyn Olson, Alberta’s minister of agriculture and rural development, presented an Order in Council that was approved by Cabinet. The order declared that “the agricultural economic hardship resulting from extreme weather conditions with early snowfall and frost damaging crops throughout the province to be a disaster, in accordance with Section 7 of the Fiscal Management Act.”
Media reports indicate Alberta’s Agriculture Financial Services Corporation (AFSC) could need to pay out about $589 million – although the final tally will depend on claims and indemnities – in crop and hail coverage to farmers in the province this year. This is up substantially from the corporation’s earlier expected payout for damage claims of as much as $467 million.
Producers have November 15 to file their crop insurance claims.
Just a few months ago, at the end of June, AFSC reported the hope was that Alberta would see a quieter hail season following record levels of hail damage over the past two years.
“Last year marked the third highest amount of hail damage to crops across Alberta in our 77 years as a provincial hail insurer,” Jackie Sanden, program co-ordinator with AFSC, said at the time. “Our branches reported 522 storm cells last year that pelted crops with hail from Fort Vermilion to the U.S. border. The damage was widespread,” Sanden continued.
In all, more than $257 million was paid out on more than 6,400 hail claims across Alberta in 2013 through AFSC’s Straight Hail Insurance program and the Hail Endorsement rider that most farmers add to their crop insurance.
The highest claim year was in 2012 when $445.6 million was paid on more than 8,400 claims, the statement notes.
In the fall of 2012, the Canadian Crop Hail Association (CCHA) estimated crop hail payments for all three Prairie provinces at $280 million for the year, with the average loss per claim rising substantially in year-over-year comparisons and the total figure based on 21,600 losses.
Saskatchewan accounted for the largest portion of payouts, recording payments of $159 million on about 13,500 losses; Alberta farmers received hail claim payouts of almost $90 million on a record-high 5,500 losses; and Manitoba had payments to producers totalling more than $31 million on about 2,500 losses.
CCHA reported that in 2012, the estimated losses were considerably higher than in 2011, when approximately $164 million was paid on 15,000 losses. Also, the average loss per claim in 2012 was expected to be $12,963, about $2,000 more than it was in 2011.
In 2014, however, there were a number of weather events leading to the declaration of agricultural economic hardship. “Crop quality was significantly affected by the poor harvest weather of early September, which included frost and snow across the western half of the province,” notes the October 21, 2014 edition of the Alberta Crop Report.
“Quality is significantly below that of 2012 and 2013, and slightly below the 10-year averages for most crops. Quality appears to be concentrated in the middle of the grade scale with lower quantities of high-quality production, but also only average amounts of low-quality production.”
Source - http://www.canadianunderwriter.ca/
