Overview

Ontario’s Beef Cattle Financial Protection Program provides financial protection to beef cattle sellers when a licensed dealer defaults on payment. Administration of the program is funded by the Government of Ontario.

The ministry licenses all beef cattle dealers (including country dealers, abattoirs, auction markets, associations and meat packers). Beef cattle producers must sell their animals to a licensed dealer and pay a check-off fee on each sale. The fees are deposited into a fund.

Two types of claims can be made against the fund:

• Cattle sellers may make a claim if a licensed dealer defaults on payment. Compensation is 95 per cent on approved claims.
• Licensed dealers may make a claim if a producer defaults on payment. Compensation is 85 per cent, up to a maximum of $125,000. There is no compensation for claims less than $5,000.

How the Program Works

The Livestock Financial Protection Board can pay the seller 95 per cent of any approved claim provided that:

• The sale was to a licenced dealer;
• Proper notification procedures for non-payment were followed;
• The claim was filed within 30 days of the date of sale; and
• Credit was not extended to the buyer.

Sellers can be beef producers, licenced dealers or auction markets.

Dealers include packing plant operators, abattoir operators, auction market operators and country dealers. All dealers must be licensed by the Ontario Ministry of Agriculture, Food and Rural Affairs.

Payment Deadlines

If the sale is $15,000 or less: Buyers must ensure that payment is made so it can be deposited in the seller's bank no later than 1:00 p.m. on the ninth business day following the day of sale.

If the sale is $15,001 or more: Buyers must ensure that the payment is made so that it can be deposited in the seller's bank no later than 1:00 p.m. on the sixth business day following the day of sale.

Notification of Non-Payment

Contact Agricorp immediately if payment is late.

Making a Claim

Sellers making a claim must apply to the Livestock Financial Protection Board within 30 days of the day of sale.

Sellers may also make a claim if a dealer has ceased operation or if a dealer's assets were placed under a trustee or receiver.

Day of sale can be:

• Day of weighing, where price is determined on a live weight basis;
• Day of grading, where price is determined on a carcass grade basis; or
• Day of purchase, where price is determined on a per head basis.

Payment can be made by cheque, direct deposit, electronic transfer or any other kind of transfer agreed to by the seller and the buyer.

Sales to Producers

Sales to producers are also covered where a licenced dealer sells to a producer who defaults on payment. In these cases, compensation is 85 per cent, up to a maximum of $125,000. There will be no compensation for claims less than $5,000.

Becoming a Licenced Dealer

All dealers are licensed by the Ontario Ministry of Agriculture, Food and Rural Affairs.

Dealer applications, along with financial statements, are reviewed by the Ministry before the licence is granted.

A dealer who fails to make prompt payment, defaults on payment or issues an NSF cheque may lose their licence.

Payment can be made by cheque, direct deposit, electronic transfer or any other kind of transfer agreed to by the seller and the buyer.

For information on how to obtain a dealer licence or make a claim, contact Agricorp.

Sellers - Protect Yourselves

Always deal with a licenced dealer. When in doubt, ask to see the licence or check the current list of licenced dealers. Sales to an unlicenced dealer are not covered by the Beef Cattle Financial Protection Program.

Do not extend credit to a dealer. This means that you should never ship another load of cattle once payment for a previous load is overdue.

Notify Agricorp if you do not receive payment on time.

File your claim with the Livestock Financial Protection Board no later than 30 days after the day of sale.

The Livestock Financial Protection Board

The Livestock Financial Protection Board (LFPB) manages the fund and determines if a claim should be paid.

Agricorp supports the ministry in licensing dealers, collects the check-off fees and supports the LFPB.

The Ontario Ministry of Agriculture, Food and Rural Affairs (OMAFRA) manages program policy, licensing decisions, investigations and enforcement.

The Livestock Financial Protection Board adjudicates claims and administers the compensation fund.

Board members are appointed by the Minister of Agriculture, Food and Rural Affairs, with nominations from the:

• Beef Farmers of Ontario
• Veal Farmers of Ontario
• Ontario Livestock Auction Markets Association
• Meat and Poultry Ontario
• Ontario Livestock Dealers Association
• Other industry groups

For more information about the Beef Cattle Financial Protection Program, to report a late payment or make a claim, please contact Agricorp.

Licenced Dealers List

(Excel)