SASKATOON — Farmers of North America (FNA) today announced the launch of the MarketPower Assurance Program, in partnership with major players in international trade.
Atradius Credit Insurance, Export Development Canada, and Pangaea Global Risk Management are combining resources to give Canadian farmers of all sizes and farmer-owned marketing entities global trading capacity with dramatically reduced risk.
In light of the changed role of the Canadian Wheat Board, grain farmers in particular will benefit from the program, but the MarketPower Assurance is open to all agricultural producers and traders, and significant opportunities are expected for livestock growers.
By providing insurance on sales, MarketPower Assurance ensures the grower will get paid, and that receivable is “bankable.”
Farmers can take their insurance policy to any financial institution and borrow against it as a capital asset. Because it is a capital loan, the proceeds are not taxable, but any interest payments are tax deductible. The insurance premium is also tax deductible.
“What we get out of this equation is a risk management and marketing tool that maximizes profit at a dramatically reduced cost,” said FNA spokesperson Terry Drabiuk.
Furthermore, MarketPower Assurance is creating a credit-worthy buyer pool that will provide Canadian farmers with more buyers for them to negotiate with when dealing in a market – supporting stronger farm product prices. The program empowers farmers to earn significantly higher margins, safely, as well as helping with their working capital through increased bank margining.
The program is also a key element of FNA’s strategy for producers to aggregate their crops to capture a larger share of the value of those crops from the grain marketing, handling, and transportation system.
“This is a program that will work well for small to mid-sized farms as well as the really big guys. Using it, farmers will become their own global traders, keeping more of the margins currently taken by middlemen,” said Drabiuk.
Kevin Sullivan, speaking for Pangaea Global Risk Management, said “MarketPower Assurance will provide Canadian producers with the ability to sell their products on open account terms all over the world – providing a huge competitive advantage against others selling on letters of credit.”
Farmers can join the program by visiting mpa.fna.ca or by calling FNA directly at 1-877-362-3276.
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For more information:
Terry Drabiuk, Vice President, FNA | 1-877-362-3276
Kevin Sullivan, President, Pangaea Global Risk Management | 1-888-986-4748
Web Site: mpa.fna.ca