Government Funding for Canadian Agribusiness
Historical support for the agriculture and agri-food sector in Canada has tended to focus on safety net protection for grain growers, support for supply management systems, developing export markets and to a lesser extent creating value-added markets for Canadian commodities. While these government supports largely remain in place (although they are being slowly dismantled) in different forms, there has been a gradual shift over the past several years to prioritize support for climate change adaptation, technology adoption and market development within the sector.
The Canadian Government has recognized the critical role of the agriculture and agri-food sector and has accelerated this change through several programs that focus on technology and climate adaptation measures.
Cumberland Strategies has worked closely with companies in the sector to help them access these support programs, which provide agri-food processors access to markets, improved competitiveness and support for the on-boarding of game changing technologies. Below we provide an overview of many of the key Government grants and incentives that the agricultural and agri-food sector may qualify for, categorized by theme.
Clean Technology Grants to Support Industrial Transformation and Innovation:
Strategic Innovation Fund: This program aims to supports large-scale, transformative, and collaborative projects that help position Canada to prosper in the global economy. This investment of $5 billion over seven years, beginning in 2021-2022 funds clean technology projects, the future competitiveness of Canadian industries, and the advancement of Canada’s technological advantage.
Investments for Transformative Clean Technology: This program is designed to draw in private sector investment for large-scale clean technology projects. Up to $1 billion is available over a five-year period, beginning 2022.
Sustainable Development Technology Canada: A government funded initiative of $750 million over five years, to support Canadian companies, clean technology leaders in efforts to develop new environmental technologies that address climate change, clean air, clean water and clean soil.
Agriculture and Agri-sector Support:
Agricultural Clean Technology Program: This program is designed to create an enabling environment for the development and adoption of clean technology. These changes will help drive the transition to achieve a low-carbon economy and promote sustainable growth in Canada’s agriculture and agri-food sector. This recently expanded $165.5 million program will:
- Prioritize $50 million for the purchase and installation of commercially available clean technologies and processes including more efficient grain dryers for farmers across Canada
- Over the next two years, allocate $10 million to powering farms with clean energy and fuel switching alternatives
- Funding will be specifically allocated towards projects under the priority of green energy and energy efficiency
Agricultural Climate Change Solutions Program: This $185 million, 10-year program aims to support the development and implementation of on-farm measures to challenge climate change. These investments will enhance agricultural practices such as shelterbelts/cover crops, and other measures to accelerate emissions reductions and improve carbon management.
Dairy Processor Investment Fund: This program is designed to support processors of all supply-managed agricultural products transition to market realities created by the Comprehensive Economic and Trade Agreement (CETA) and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). Starting 2021-2022 the government proposes $292.5 million over seven years to support processors and private investments in processing plants.
Canadian Agricultural Partnership: This is a five-year, $3 billion federally funded program designed to support the sector in meeting the Government’s ambitious goal to grow Canada’s agriculture and food exports to $75 billion by 2025. The program is broken down into the following key themes:
- Growing trade and expanding markets– $297 million
- Innovative and sustainable growth in the sector– $690 million
- Supporting diversity and a dynamic, evolving sector– $166.5 million
AgriInnovate Program: This is one of the programs under the Canadian Agricultural Partnership. It aims to provide repayable contributions for projects that accelerate the demonstration, commercialization, and/or adoption of innovative products, technologies, processes, or services that increase competitiveness and sustainability. The program will prioritize project applications that advance the government’s agenda through one or more of the following priority areas:
- Adoption of new or world leading clean technology (including precision agriculture)
- Increase productivity through advanced manufacturing, automation, or robotics
- Strengthen Canada’s value-added agri-sectors
- Secure or expand new export markets
AgriStability Program: This isone of the business risk management programs under the Canadian Agricultural Partnership-this program aims to provide support towards the management of large farming income declines for reasons such as production loss, increased costs, and market conditions.
AgriInvest Program: This is one of the Business Risk Management programs under the Canadian Agricultural Partnership designed as a self-managed producer-government savings account to help you manage small income declines and make investments to manage risk and improve market income.
Canadian Agricultural Loans Act Program: This program is a loan guarantee program designed to increase the availability of loans to farmers and agricultural co-operatives. Farmers can use these loans to establish, improve, and develop farms, while agricultural co-operatives may also access loans to process, distribute, or market the products of farming. Loans are limited to a maximum of:
- $500,000 for the purchase of land and the construction or improvement of buildings
- $350,000 for all other loan purposes, including consolidation/refinancing
Our Takeaway:
We observe a clear transformation of priorities from the Canadian Government to promote and support a clean technological transition, push climate change adaptation, and enable market development. Through these grants, Canada is looking to encourage businesses to invest in clean energy and efficient equipment, while maintaining growth and securing long-term competitiveness.
Bliss Baker is the Chairman and founder of Cumberland Strategies and has represented a range of large Canadian and multi-national companies in the ag-sector. Vienna Psihos is our analyst with a focus on agriculture and the agri-food sector.
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