Evidence of meeting #37 for Agriculture and Agri-Food in the 39th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was srm.
A recording is available from Parliament.
4:25 p.m.
Executive Director, Animal Nutrition Association of Canada
You're correct. I think it's fair to say that there has been some progress in the last few months, but given the size of the task and how daunting it is, the progress certainly hasn't been enough to track us to July 12 in a safe way.
4:25 p.m.
Executive Director, Canadian Meat Council
We merely want to know, or have someone write to tell us, if we are eligible to have reimbursed some of the expenses that we will incur, so that we can start construction. However, we haven't even received the go-ahead for this.
Each province has a responsibility to deliver on federal funding. This team is not working fast enough for us. We don't want to lay the blame on anyone, we simply want things to move forward.
4:25 p.m.
President, Rothsay, Maple Leaf Foods Inc.
I think it's important to note that although the technical date is July 12, as Kathleen, who is the purchaser of the products, says, the reality is that the date is sooner than that. We have definitely been talking to the government about that since last summer and been pointing out that we have to get going on this, because the ability to execute is hard, even starting back then. From now until May 1, if we're not ready, everything that is produced is SRM, which loses value and essentially has no place to go to be disposed. That's a big issue.
4:25 p.m.
Bloc
André Bellavance Bloc Richmond—Arthabaska, QC
In this as in other matters, provincial areas of jurisdiction must be respected. I can't imagine that this is the first time that discussions have taken this long. We have managed to smooth over such problems in the past. We've seen this happen before and it probably won't be the last time either. The trouble is, I'm having problems keeping track of things.
Mr. Goldring, you stated that you had drawn up a list of those provinces that have made progress on this matter and had prepared a kind of status report. So then, things are moving forward, but the industry has yet to see any money. A mere five months from the deadline, nothing has been done. Mr. Goldring, I thought I understood you to say earlier that the provinces had made some progress.
4:25 p.m.
President, Rothsay, Maple Leaf Foods Inc.
Let me reread...for example, I'll use Alberta, which is dealing with the largest amount: “The independent renderer operating in these provinces expects to receive and process the SRM material from the two packer renderers.” So West Coast Reduction, which has a rendering plant, will build another line. But as they've said, and this is from their notes to me, “Separation and construction of a separate processing line remains dependent on capital funding assistance being made available to the company.”
So they are not going forward. They've done the engineering, they're getting ready, but this a substantial capital investment. They aren't going to do that unless they have that capital funding. For them to be ready, I don't think it's realistic to build another line that quickly.
I said in Ontario, Atwood is moving ahead at certain levels, but they're stopping because they're not going to handle the rest of it. From the standpoint of things like disposal, we've definitely been in touch with a variety of landfills, but that takes time. Some we haven't got approval for, and some will take the rendered product as opposed to the raw product. The raw product is the guts and the bones, pretty messy stuff. The rendered product is the powdered material, a little easier to take to a landfill.
The other concern is, even if you had the approval to take the raw material to the landfill, how quickly would somebody in that jurisdiction say they don't want this stuff anymore, once they get a little taste of that material coming into their jurisdiction?
Does that make sense?
4:30 p.m.
Bloc
André Bellavance Bloc Richmond—Arthabaska, QC
It's hard for me to believe that officials from various levels of government are not on this, because July 12 will be here before you know it. I would have like to hear some views on the subject.
Mr. Laws, I believe you mentioned earlier that you wrote to the minister and requested a meeting with him. Have you received an answer? I would imagine that you have contacts within the department. Have you heard anything at all about how this matter is progressing?
4:30 p.m.
Executive Director, Canadian Meat Council
I know that over the past two weeks, a departmental representative has visited each province in Canada to encourage them to sign on, to advance funds and to set out program criteria, so that decisions can be made regarding contracts with firms.
Last Friday, we spoke to the minister again in Vancouver. As far as we know, no provinces have signed the agreement to date. However, Alberta has unveiled to industry officials the details of a program that it intends to carry out with the federal government. That's where matters stand at the present time.
4:30 p.m.
Executive Director, Canadian Cattlemen's Association
On that, we have had conversations with the minister and the senior officials. Our understanding is that they have indicated that the federal funds are available and eligibility will not be dependent on the commencement of the projects afterwards. In other words, they're willing to accept the retroactivity that we've asked for, but it gets bogged down because of the federal–provincial agreement that's required, with most provinces saying they have to go to their treasury departments first before they're prepared to make that commitment. So we're caught in that lengthy process you referred to earlier, when you get down to negotiating the final details around the financial commitments of both parties.
4:30 p.m.
Conservative
4:30 p.m.
Conservative
Larry Miller Conservative Bruce—Grey—Owen Sound, ON
Thank you, Mr. Chairman.
Madam and all the witnesses here, thanks very much for coming today. I'm a beef farmer too, so I understand the quandary that we're in here.
First of all, Mr. Laws, I believe it was you who mentioned that the last thing we want is a delay or anything like that. Have you heard some indication that it's in the works? I haven't, so I'd just like to clarify that.
4:30 p.m.
Executive Director, Canadian Meat Council
Some members are just shaking their heads, asking how they're going to make the deadline. As I mentioned in this report, we had been advocating before for the same list the Americans were going to have, because we knew that was going to put us in a very uncompetitive position. But when the announcement came out, we didn't whine, we didn't complain, and we didn't say we weren't going to comply. We said, okay, that's it, we didn't get that, but certainly we're going to comply. The government announced this $80 million at the same time. That was way back at the end of June.
People have their plans. As Kevin said, they have their plans, but they're not going to go ahead and spend millions and millions of dollars on plant and equipment if it doesn't come through.
Given the delay with all the provinces, we have also asked the federal government if we can we get the funding directly from them. The answer is no. It has to go through the provinces because in Canada—welcome to Canada—it's a shared responsibility. Agriculture and the environment are shared, so it has to go through the provinces. That's the holdup, and that's what we're waiting on.
4:30 p.m.
Conservative
Larry Miller Conservative Bruce—Grey—Owen Sound, ON
That's a good point. As my colleagues at the table here have already said, working with the provinces isn't always easy. We recognize that, I think, but that still doesn't take away from the fact that we are approaching the deadline very fast. I agree with you. I don't think we can delay it. It has to come through.
I have a few questions. First, did any of the new packing capacities or packing facilities that were built during the height of the BSE crisis, whether they were additions or brand new, allow at that time for the removal of SRMs in order to make it less costly at this point? Were any of them developed like that? Does anyone know?
4:35 p.m.
Executive Director, Canadian Meat Council
No, they did not put in separate lines at that time.
4:35 p.m.
Conservative
Larry Miller Conservative Bruce—Grey—Owen Sound, ON
We're starting right from scratch even with those.
4:35 p.m.
Executive Director, Canadian Cattlemen's Association
We should clarify that they were designed to remove SRMs from the food portion, which they do completely, but they all go into the same disposal lines that come out of their system. At that point when most of those investments were made, there was still quite a discussion on whether to go with the long list or the short list. The final decision was the long list that took place.
4:35 p.m.
Conservative
Larry Miller Conservative Bruce—Grey—Owen Sound, ON
Ms. Sullivan, you mentioned that we have this May 1 deadline when we have to start. Could you again go through exactly what needs to happen on May 1 and basically what happens after that as far as disposal between there and July 12 is concerned?
4:35 p.m.
Executive Director, Animal Nutrition Association of Canada
Effectively the regulations come into being on July 12 for all of the industries that are affected, and that's completely unrealistic. Our final objective is to get this material off the farm and out of the feed system as much as possible on July 12, so we have to back it up. What we're recommending to our members is that they go to their suppliers and ask their suppliers to have SRM-free material available to them on May 1.
We know there are feed companies that have already gone to their suppliers and asked for SRM-free material even now, particularly for bagged feeds, which tend to stick around in the system a little bit longer. On May 1, the feed ban is very easy for the feed industry to comply with. We just stop buying the product.
The challenge isn't really for the feed companies. They'll just call their suppliers and say that they either have the SRM-free material for the feed companies or they send soy meal or an alternative product. What really happens at that point is that the whole system backs up. The renderers then end up with product and the packers have nowhere to send it. What we end up doing, by virtue of trying to comply with the regulation, is really exacerbate the problem. We take the July 12 date and we really just take three months off that period of time.
4:35 p.m.
Conservative
Larry Miller Conservative Bruce—Grey—Owen Sound, ON
One of you talked about how we can do a number of things. You said we can take it to a landfill, and I believe it was you, Mr. Laws, who said there were 160 tonnes.
4:35 p.m.
President, Rothsay, Maple Leaf Foods Inc.
In Ontario, possibly there will only be 160 tonnes of specified risk material. But if I could, I'd just follow up on what Kathleen said, because it is important.
First of all, her members could essentially enact the ban from their perspective today, because they're the purchasers of the product. They don't have to buy it. They're not affected whatsoever, except for their involvement in the chain, and they're responsible.
From our perspective, on May 1, if we're not ready to go.... I'll give you the example of our Dundas plant. It's located near Hamilton. Right now, the Dundas plant handles approximately 5,000 metric tonnes per week of ruminant-based raw material. It's important to go back in time to when BSE hit. All the large rendering plants segregated their plants at that time. It used to be that whatever the material was—pork, beef, chicken, or whatever—it all went to the closest plant. When BSE hit, we split the plants, which is one of the reasons we're in a difficult situation now, because there are no extra plants around, so to speak.
I'll give you the Ontario example. Our plant in Moorefield, north of Guelph, is a non-ruminant plant. It handles pork, poultry, fish, etc. The plant in Dundas handles all ruminants. That plant handles about 5,000 metric tonnes of ruminant material—bones, guts, etc.—per week. Of that, our estimation is that about 400 metric tonnes are SRM. Some of that will be handled by the dead stock, which is right now being picked up by Atwood and then comes back through the Dundas plant. We'll handle that. We're working with them on that. For the 160 tonnes, they're not ready to go on that and that may have to go to landfill, if we can find a landfill.
The issue we have on May 1 is that if we're not ready to go there—and I'm just using Ontario as an example—all that volume at Dundas could be specified risk material.
4:35 p.m.
Conservative
Larry Miller Conservative Bruce—Grey—Owen Sound, ON
Just so that I don't run out of time here, to carry on with this, there is taking it to the landfill site and then there's composting. I need to understand the composting a little better, because as a farmer, if I lose a cow, I have to either get the dead stock in or I bury it. You can't leave it around. So how do you compost this? It's not only the smell that you have to worry about; you have animals. It must be in some kind of contained compost site.
4:35 p.m.
President, Rothsay, Maple Leaf Foods Inc.
For on-farm, an abattoir associated with a farm is allowed to compost the SRM material. If it's an abattoir not associated with a farm, for example, it cannot do so. The regulation states that.
