SSGA Worried About Impact of Federal Carbon Backstop

The Saskatchewan Stock Growers Association is concerned about the impact that the federal carbon pricing system being imposed on Saskatchewan will have on the province’s beef producers.

On October 23, the federal government announced it will be applying its federal carbon pricing system to Saskatchewan as well as to Manitoba, Ontario and New Brunswick in 2019. The carbon policy will add a tax to fossil fuel production and distribution and for industrial emitters. The federal government also announced that farmers will receive an exemption for on-farm use of fuel for farm machinery and rural residents would receive a supplement. Nevertheless, the SSGA remains unconvinced that a carbon pricing policy would make any meaningful reduction in global greenhouse gas emissions looking at the experience of other provinces and countries because it is economically inefficient.

“Despite these rebates and exemptions, producers will still be facing higher costs to run their operations,” SSGA President Bill Huber stated.

In addition to fuel, producers use goods and services like feed and inputs from other sectors which are expected to pass down their added expenses onto cattle producers. Getting Saskatchewan cattle to domestic and world markets will also become more expensive because there are few fuel-efficient transport options. As a result, Canadian beef, which is produced sustainably, efficiently and with one of the smallest carbon footprints in the world, will become less competitive in the global market.

“Beef producers will have to absorb these extra expenses into their operations which cuts into their bottom line. These additional costs can not be passed down the value chain,” he added.

The SSGA supports the Saskatchewan Government’s court challenge of the carbon tax and the provincial Climate Change Strategy which recognizes the carbon sequestration capabilities of the province’s grasslands and pastures.