Ottawa increases AgriStability cap to help industry as it faces Chinese tariffs

David Reid drives a seeding rig as he plants a canola crop on the family's farm near Cremona, Alta., Tuesday, May 16, 2023. THE CANADIAN PRESS/Jeff McIntosh

OTTAWA — The Canadian government has announced support for the country's agriculture sector as it deals with tariffs imposed by China.

The federal agriculture department says in a news release that the current payment cap under AgriStability, a program that works similarly to crop insurance, will double to $6 million for the 2025 program year.

Support also includes increasing the compensation rate from 80 per cent to 90 per cent.

Agriculture businesses are facing 100 per cent tariffs from China on canola and peas, as well as a 25 per cent levy on pork and some seafood products in retaliation for Canada's tariffs on Chinese-made electric vehicles, steel and aluminum.

Former prime minister Justin Trudeau said those vehicles have an unfair advantage that's hurting the Canadian auto sector.

The news release says the Chinese tariffs come as the agriculture sector also deals with trade uncertainty with the United States, and other risks like animal disease.

“China’s decision to apply these tariffs will have a devastating impact on our farm families and their communities. We’re working hard to diversify our trading partnerships and establish new markets, but we know the sector needs support now," Agriculture Minister Kody Blois said in the news release.

"Today’s announcement is a direct result of their advocacy — and our commitment to them."

Annie Cullinan, a spokeswoman for Blois, said in an email the estimated federal cost of the supports is $108.7 million in 2025-26.

AgriStability is cost-shared, with the federal government paying 60 per cent and provinces paying 40.

Cullinan said Blois was reaching out to his provincial counterparts Saturday evening.

Saturday's announcement says that to get money to producers faster, Ottawa is also giving provincial and territorial governments the option to make agreements to issue interim payments at a higher payment rate.

Producers, processors and premiers have all expressed concern about the Chinese tariffs. Alberta, Saskatchewan and Manitoba rely heavily on China for canola exports, sending billions of dollars in products overseas each year.

Manitoba Premier Wab Kinew said after a first ministers' meeting Friday that he has asked Prime Minister Mark Carney to talk to China, but cautioned Carney that he should ensure any talks with China don't hurt Canada's relationship with the U.S.

Saskatchewan Premier Scott Moe has said the tariffs on canola would devastate the industry in Saskatchewan, and fourth-generation Saskatchewan canola farmer Clinton Monchuck said he expects to lose $100,000 this year if the tariffs stay in place.

This report by The Canadian Press was first published March 22, 2025.

The Canadian Press