Agriculture Committee on June 15th, 2006

[Serge Lefebvre]

Mr. Chairman and Mr. Bellavance, I also feel that the adoption of this motion on the eve of the Hong Kong meeting, as was mentioned, was very important. There was some discussion about this earlier, but I think that in so doing, Canada was not isolated because it did manage to influence some of the texts. It may be said that it was done at the last minute, but I think that Canada played an important role at Hong Kong in that regard.

Let us talk more specifically about Quebec. Supply management covers 40% of farm income in Quebec, which is hardly insignificant. I think it is important to maintain the motion passed by the House of Commons, because it is important. If you read the motion carefully, you can see that it provides openness for all agriculture while protecting one sector, as is mentioned, of Canadian agriculture that is very important, that is, 40% of income in Quebec, 30%—and probably a bit more now—in Ontario and 20% of Canadian farm income. The supply management tool has been very important, after all. It has been unanimously supported by the House of Commons.

[André Bellavance, Bloc, Richmond—Arthabaska, QC]

I have great memories of that day because I tabled that motion myself. I can tell the committee that we spent the entire day negotiating with the then Minister of Agriculture, Mr. Mitchell. In addition, the party that is currently in power, the Conservative Party, also unanimously supported that motion. I distinctly remember seeing Mr. Duceppe discuss it with Mr. Harper. I discussed it with the then Agriculture critic from that party, Ms. Finlay. The NDP also voted in favour of that motion. The Parliament of Canada and a number of provincial legislatures all understood the purpose of that motion. It was very helpful in Hong Kong and still is today. I do not agree with the claim that it was harmful to Canada's negotiations.

Ms. Koch, I would like you to comment on a poll that was done quite recently, from May 16 to 21, and that was commissioned by producer members of the SM5 coalition. The poll shows that 85% of Canadians agree that the federal government has to support the supply management approach in the dairy, poultry and egg industries, and that 83% of them believe that supply management is a better approach than subsidies funded by taxpayers to ensure stable income for farmers.

I do not want to pit exporters against people who want to protect supply management, but it is clear to Canadians that the supply management system, which other countries want to disrupt, has to be protected. A bit earlier, you apparently said that I agreed with what Mr. Lamy said. I most certainly do not. I do not think we should have all the pressure on us and have to make all the concessions while other countries, legitimately, also want to protect their markets, and at the same time gain access to other countries' markets.

What do you think of the fact that the Canadian public supports the supply management system?

[Alanna Koch]

You had a long list of points and questions there. I'll try to address at least some of them.

First of all, with respect to the motion in the House last fall, while it was unanimously supported, as I stated earlier, I think it was misguided, unfortunately, because of how it impacted in a negative way on Canada's position at the WTO.

[André Bellavance, Bloc, Richmond—Arthabaska, QC]

So you are saying that all of the political parties and all of the provincial legislatures that voted in favour of the motion were wrong?

[Alanna Koch]

What I'm saying is that because the statement within the motion that spoke to supply management spoke about zero change to anything with respect to TRQs and tariff levels, it doesn't allow the Canadian negotiators to have any room whatsoever, and that is not consistent with Canada's position with respect to the Doha mandate and framework.

[André Bellavance, Bloc, Richmond—Arthabaska, QC]

No--

[The Chair, Conservative, Gerry Ritz]

Mr. Bellavance, allow her time to explain her position.

Your time is actually up, so I'm being tolerant in allowing this to go on.

[André Bellavance, Bloc, Richmond—Arthabaska, QC]

I think I am allowed to intervene. This is not question period in the House of Commons.

[The Chair, Conservative, Gerry Ritz]

I understand that.

[André Bellavance, Bloc, Richmond—Arthabaska, QC]

I see what she is getting at, but...

[Alanna Koch]

With respect to your second point about a poll, I'm not familiar with the specifics of the poll. I'm not aware of exactly what the questions were, how they were asked, or what the exact results were. But you've indicated that the Canadian public supports supply management and believes the Canadian government should support supply management.

What I will say generally is that I don't think I'm being inconsistent with that position. I don't think I'm being inconsistent with what obviously the Canadian public must have said in that poll. What I have indicated is that the interests of our members as exporters must be remembered too.

It isn't a win-lose or zero sum game; it is about taking our best position and going forward, from Canada's perspective. Unfortunately, we have no allies. We have no room at the WTO to be so intransigent on that one position with respect to sensitive products.

As I said earlier, supply management is not being negotiated at the WTO; market access is, and the way we treat sensitive products is. That doesn't mean supply management is gone; it just means that Canada has to make some adjustments.

As a grains and oilseeds producer, I''m probably going to have to make adjustments as well, once we get a WTO deal. I am willing to make those adjustments, because I believe many opportunities will also come that will impact me, so I'm willing to make the adjustments.

To say that Canada is the only one making concessions at the WTO simply is not the case. We have many other protectionist countries at the WTO that are willing to make concessions and willing to make adjustments. Even the G-10, which are 10 of the most protectionist countries in the world, recognize that they're going to have to make adjustments within their own systems.

[The Chair, Conservative, Gerry Ritz]

Thank you.

Mr. Valley, I'll allow you a minute at the end here. We're out of time, but I'm trying to give everybody a shot.

[Roger Valley, Liberal, Kenora, ON]

Thank you. I'll be very quick.

Mr. Davis, you mentioned you're here representing your people. Well, so are we, and so we understand that very clearly.

You talked about the lessons learned from BSE and what we can do about it and how we plan for our future. I think the terms you used were that we slaughter...our capacity was 72,000, and it's over 100,000 now. What's the future for that? How far can we go? What more can we do there?

[Darcy Davis]

What's interesting and what more we can do lies in the fact that 33% of the world's beef is consumed in North America—we know that—in Canada, the U.S., and Mexico. The fact is that we've brought new entrants into the processing sector; there are two or three coming on. Those individuals or those companies are going to have to compete with large international companies for customers in North America if we don't get access to new markets and gain an ability to put our product in a competitive position in countries such as Japan and in the EU and those places.

[Roger Valley, Liberal, Kenora, ON]

Did you mention that our actual capacity, what we're slaughtering right now, is 100,000?

[Darcy Davis]

That's at six days a week if we run wide open. Right now we're probably not running at that. But we're exporting very few live cattle at this point right now; we are doing them here in Canada.

[Roger Valley, Liberal, Kenora, ON]

That's the capacity, not the actual kill.

[Darcy Davis]

Yes, the actual kill is somewhat less than that right now.

[The Chair, Conservative, Gerry Ritz]

Thank you, Mr. Valley.

Mr. Atamanenko, you wanted to raise a point.

[Alex Atamanenko, NDP, British Columbia Southern Interior, BC]

Yes, I have a quick question.

It's no secret that the U.S., the European Union, and others want us to water down our system. New Zealand wants us to do away with supply management so that we can import butter and milk. It seems to me that we need some courage in our country to stand up for what we believe in.

I notice that in the policy statement and in your CAFTA document, Alanna, CAFTA's long-term objective is for global free trade in agriculture and agrifood products. I would like you to make a quick comment. As you gaze in your crystal ball, if this happens, does it mean the end of supply management and other state trade enterprises like the Canadian Wheat Board?

Could you give a quick answer?

[The Chair, Conservative, Gerry Ritz]

Very quickly, gentlemen and Alanna.

[Alanna Koch]

Are you asking me for a comment?

[Alex Atamanenko, NDP, British Columbia Southern Interior, BC]

I'm asking for a quick comment.

[Alanna Koch]

I think that in the long-term we're still going to have the ability in our countries to determine what our domestic marketing structures will be. Yes, our overall long-term goal is global free trade, but I don't believe it has an impact on what our domestic marketing structures are, as long as they are not trade-distorting.

[John Masswohl]

I think we can learn from history. I think you know the B.C. wine industry very well. I grew up in the Niagara region, and I recall that in the late 1980s the Canada-U.S. Free Trade Agreement was going to be the death of the wine industry in Canada.

When you have these market forces, you have competition and you force an industry to be more competitive, to make changes, and to make adjustments. Sometimes there are some transitional issues that go along with it. I think that in those areas it's appropriate for government to be involved in transitional assistance. I think that all sectors in Canada can do very well with global free trade in agriculture.