Evidence of meeting #12 for Agriculture and Agri-Food in the 41st Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was organic.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

  • Richard Robert  Chair, Canadian Farm Business Management Council
  • Heather Watson  General Manager, Canadian Farm Business Management Council
  • Ted Zettel  General Manager, Organic Meadow Co-operative
  • Bob Seguin  Excutive Director, George Morris Centre
  • Johanne Van Rossum  President, Fédération des groupes conseils agricoles du Québec
  • Mathieu Pelletier  Management Agronomist, Réseau d'expertise en gestion agricole, Fédération des groupes conseils agricoles du Québec

4 p.m.

Mathieu Pelletier Management Agronomist, Réseau d'expertise en gestion agricole, Fédération des groupes conseils agricoles du Québec

Good afternoon, everyone.

The Fédération des groupes conseils agricoles network includes close to 70 management agronomists, who are assisted by 20 technicians. I am one of these management agronomists.

Still, our clientele is quite diverse. At 85%, dairy farmers make up the largest part of our clientele. All the same, we serve 2,000 producers in Quebec. Our network extends to all regions of Quebec, and to Ontario, Manitoba and New Brunswick.

What are agricultural management advisory services? First, an agricultural business can receive several types of agricultural management advisory services. These are mainly techno-economic and financial analyses, budgets and follow-up, comparative analyses of groups, as well as advice on starting and transferring a business.

4 p.m.

President, Fédération des groupes conseils agricoles du Québec

Johanne Van Rossum

As for the specific nature of the groups, these services are obviously also offered by certain private businesses. What distinguishes the services of our groups is the collective approach. For 30 years, we have made many visits to member and non-member businesses. We also have information and exchange activities. The educational component is very important to us.

Comparative analysis is one of our services. For example, once we have identified the production costs for each of the farms, it is useful to compare with other businesses in the same sector. These are what we call comparative analyses. We identify a top group, made up of the most effective businesses offering the best performance, and a bottom group to observe the differences between them.

These analyses provide an external point of view. Within the business, the producer doesn't always see the problems the same way that a consultant who adopts an external point of view does. That point of view helps the producer make better decisions about projects. It is also a preventative approach, rather than a corrective one, because we can identify the difficulties in advance and take steps to correct them.

In essence, it involves overall management of the business, an annual follow-up and ongoing improvement of the business' performance. The groups do not make just one visit to each farm. They can return to see the farm year after year and see the business evolve. This makes it possible for us to have more competitive businesses and producers who are in a better position to make good decisions. The decisions rest on the producers' data and not only on means.

4 p.m.

Management Agronomist, Réseau d'expertise en gestion agricole, Fédération des groupes conseils agricoles du Québec

Mathieu Pelletier

Among the management consultant support programs, there is the Programme d'appui au développement des entreprises agricoles, or the PADEA.

Since 2005, funding based on deliverables has been used as part of the Growing Forward 1 program. Recently, there was the Stratégie de soutien à l'adaptation des entreprises agricoles, another program based on deliverables aimed at helping businesses experiencing financial difficulties.

What's interesting in this new approach is the multidisciplinary aspect in the delivery of consultant services. The multidisciplinary approach means that it isn't just the management consultant working on the business; there are technical advisors as well who help identify improvements that can be made to a business.

But what facilitates the access to management consultant services is that less than 15% of agricultural businesses in Quebec use the specialized subsidized agricultural management advisory services. Too few agricultural businesses make use of these services. Keep in mind that techno-economic management contributes to the development and performance of agricultural businesses.

In our opinion, the program responds in part to the needs of producers. The program is good and we would like it to continue. But we are recommending slight modifications.

4:05 p.m.

President, Fédération des groupes conseils agricoles du Québec

Johanne Van Rossum

Here are a few of our main recommendations. We think it is important to keep management at the heart of the Growing Forward 2 framework and to promote it. It is also important to support the organizations that are dedicated to promoting and delivering agricultural management consultant services. This is currently the case in project funding in stream 4 of Growing Forward 1.

It is also important to support the collective formula of delivering management consultant services, which has proven its worth in the past 30 years, to emphasize support for training agricultural producers and encourage exchanges and techno-economic analyses, as well as group analyses. Lastly, we recommend keeping the PADEA in place and making it more flexible, because some services are not provided for in the deliverables identified.

4:05 p.m.

Management Agronomist, Réseau d'expertise en gestion agricole, Fédération des groupes conseils agricoles du Québec

Mathieu Pelletier

For example, some investment projects are used to evaluate the financial techno-economic impact of businesses. This helps us properly target our investments to ensure that once the business is established, it will be competitive and successful. These evaluations are not included in the services that can be used. Therefore, the producers often tend to solicit their financial institutions directly and have their projects evaluated another way.

4:05 p.m.

President, Fédération des groupes conseils agricoles du Québec

Johanne Van Rossum

We would also like to emphasize support for follow-up, meaning follow-up on recommendations. Once the solutions have been considered or the photo has been taken for the business, we need to continue follow-up on the recommendations and to provide support related to the follow-up, and to incorporate an aspect dealing with the multidisciplinary approach.

The multidisciplinary approach brings into play not only the management consultants, but also the technical consultants, to help us bridge the gaps that have been identified. This multidisciplinary approach is ideal at all stages, both at the business' diagnostic stage and the follow-up and intervention plan stages. The management consultant identifies all the problems but does not have all the answers.

In closing, I will say that we think the management service gives a global vision of the business that enables us to examine the issue and make these businesses more competitive. It isn't only a technical or economic vision; it's a techno-economic vision.

Thank you.

4:05 p.m.

Conservative

The Chair Larry Miller

Thank you very much.

We will now move to questions.

Mr. Allen, for five minutes, please.

4:05 p.m.

NDP

Malcolm Allen Welland, ON

Thank you, Mr. Chair. Thank you all for being here.

This question is actually addressed to Mr. Zettel and Mr. Seguin, because both of you are talking about certain types of scale—and perhaps you aren't talking about the same scale.

Mr. Zettel, you talked earlier about farms not being one-size-fits-all, in the sense that some would be smaller and some wouldn't be as small.

Mr. Seguin, you talked about this sense of scale. My impression—and of course I'm going to allow you to help me with it—was that you saw that scale being larger.

Perhaps I could ask both of you to address it in terms of what you see as the natural scale—if I can use the term “the natural scale”—versus what you, Mr. Seguin, see as the same process within the organic sector and the other sector that one might call “traditional”. I'm trying to use terms that we all accept, but they may not actually be wholly accurate, to be honest. Let's just use them to look at what we think those scales are.

Whoever wants to go first may; it's okay.

4:05 p.m.

General Manager, Organic Meadow Co-operative

Ted Zettel

In addressing that, I would say, first of all, that everyone recognizes that we will have large-scale and small-scale producers; that's a necessity aimed at serving different markets. For the commodity market, which has tended to dominate agricultural policy historically, scaling up is the obvious solution for lowering cost and competing on the international market. We don't dispute that.

I don't think there's a great need for agricultural policy to be aimed at assisting that activity, because my experience in business indicates that will happen naturally. There's such an economic imperative to go to a larger scale that it happens by itself. What doesn't happen by itself is keeping the smaller player in place, the player that's very necessary to be able to innovate and adapt to changing domestic demands—and that's what we find all over the country. We just don't have those small-scale farmers, increasingly, or the processors we need to meet a very diverse consuming public's demands, whether the new ethnic populations or the emerging markets that are demanding knowledge of how and where the product is grown.

That's something that's relatively new. In 1950, it didn't matter. Milk was milk and wheat was wheat. In 2011, it matters. But in the intervening 60 years, we have allowed the infrastructure necessary for responding to these demands to slip away from us, through successive government policies that have concentrated almost exclusively on serving the export market.

4:10 p.m.

Excutive Director, George Morris Centre

Bob Seguin

It's interesting working, as the centre does, with some larger processors and large farm producers. As to the comments Ted made about the bias against small, they feel it's a bias against large. Their challenges are that they're trying to reach the marketplace by investing in technologies and investing in land. Rarely have they been given it, so it's a sense of how you adjust to the marketplace.

To your question, we at the centre would say that as you look to where the market opportunities are, you will have to scale up to match them and to be competitive; or you scale to the activity level that you're in, whether a niche market, an organic market, or something that's very regional. Why have thousands and thousands of acres, or thousands and thousands of capacity at the processing level?

On the other hand, you have to be efficient. You have to be competitive. The challenge that Ted's referring to with the small abattoirs is that a lot of these small guys over time have not been competitive. They have not met the standards. These are not federal standards that they have to meet. These are provincial standards, and there's a large argument about federal and provincial standards being equivalent. But, they have to do this. And are they doing it, and do people really want it?

On the other hand, as markets shift—and Ted's company is a great example—there are opportunities to both enter the market and scale up. Are we always assisting that? The challenge for the dairy sector is that because of the way the system is, it's not as agile as maybe some people would like it to be. As for the reference to artisan cheese, there are opportunities to create artisan cheese, and maybe scale up to a certain level. The question is, can you expand beyond that? That will be the challenge for the dairy sector, and it will be the challenge for other supply-managed sectors.

On the scale side, our concern is that if Canada wants to participate on a global basis and be competitive, it has to have sufficient scale with some of its processors and a number of its producers, and the entire supply chain has to work together at that scale level. If it's looking to a more domestic market or a very unusual market, it scales back again and they still have to be competitive.

4:10 p.m.

Conservative

The Chair Larry Miller

Thank you.

I'll move to Mr. Lemieux for five minutes.

November 17th, 2011 / 4:10 p.m.

Conservative

Pierre Lemieux Glengarry—Prescott—Russell, ON

Thanks very much, Chair.

These have been excellent presentations. I find this fascinating. There were a couple of really good comments made, one of them being that I think we all want to see farmers succeed with their farms founded on sound business principles. I think there's a real desire for that, but I also think we're in an environment where—and I think Mr. Seguin made the point—we're not able to add funding or to see any kind of significant funding to programs that already exist. It's going to be a reallocation of funding. There are trade-offs that have to be considered.

From the Saint Andrews meeting, certainly the opening move is a willingness to negotiate. I think that's what was basically expressed, with some goals about where negotiation should take place. Of course, the next steps will be the provinces and the federal government actually negotiating, working out, and examining these trade-offs.

When it comes to business development, one of the questions I have is—and perhaps I'll ask this question of Heather or Richard—in terms of the take-up on training. You're offering services and I'm wondering if you have any kind of measurement system that allows you to assess, first of all, what kind of take-up you get when farmers participate in a training program or initiative. More importantly, what percentage actually implement what they've learned or seen on the course? And finally, what is also very important is, what's the impact? Is there any way to say, "I went to that course, I heard 50 good ideas, I implemented 30, and I'm 15% stronger than I was before I went on that course." Do you look at that at all? I think it's an important parameter.

The government likes to know when it's investing money that it's actually yielding certain outcomes. Do you look at that at all?

4:15 p.m.

General Manager, Canadian Farm Business Management Council

Heather Watson

We look at it to the extent we can, because a lot of the data coming back is anecdotal. We know that a farmer participating in a given course or a series of courses was inspired to go back to school, for instance. Figuring out what that means for them, and what that means for the community around them, is difficult to measure.

We actually have a project under way right now where we're looking at establishing a longitudinal study on the impact of farm business management on farmers and the economy, in terms of profitability, but also success as defined by happiness, work-life balance, human resource management, and things like that.

Right now we don't have a definite number saying that you're going to be 3% more profitable next year because you attended this course or because you read this book. There are claims for numbers like that. I know we heard David Cole speak last week and he said, "If you have a written business plan, you're 25% more profitable,” end of story. But we don't have that information available in Canada.

I think that's why part of my presentation focused so much on having comparable performance measures across the country, because we're seeing a whole lot of consultations and a whole lot of assessments, but there's no comparability because all of the questions are different and being asked for different purposes. We'd really like to concentrate on getting some consistency and some consensus around what it is we want to find out, and what measures we can agree on for that. We'd love to see that move forward.

4:15 p.m.

Conservative

Pierre Lemieux Glengarry—Prescott—Russell, ON

I think it's an easy question to ask, but it's very difficult to implement. I think there is value in implementing it, because I think farmers want to see it themselves.

I would like to ask the same question to the people with the federation.

You are working with the consultants who are working directly with the farmers on the farm. Do you have any more concrete results as a consequence of their work?

4:15 p.m.

Management Agronomist, Réseau d'expertise en gestion agricole, Fédération des groupes conseils agricoles du Québec

Mathieu Pelletier

We love agricultural management, among other things, because it allows us to follow businesses from year to year and then compare the current year with past years. We evaluate their projects. For example, we could evaluate the production costs of a business by finding that, this year, the percentage of its costs represented 83%, that it carried out its investment project, that it decreased its costs, which now represent 75% and that the project is doing well, that it has a revenue surplus at such and such an item, and a reduction in its costs at such and such other item. It's one of the things that we do and that we want to continue to do in the future by continuing to follow-up on the businesses.