Agriculture Committee on May 26th, 2014

[The Chair, Conservative, Bev Shipley]

Thank you very much, Madam Brosseau.

Now we'll go to Mr. Zimmer for five minutes, please.

[Bob Zimmer, Conservative, Prince George—Peace River, BC]

Thank you.

Thank you for appearing before the agriculture committee today.

Would I be correct in saying that your focus is on the pre-consumer side of food waste? That would be accurate, wouldn't it?

[Martin Gooch]

Primarily, yes.

[Bob Zimmer, Conservative, Prince George—Peace River, BC]

So you're more the wholesaler side than retailer. You've answered some of the questions in terms of the peach example and others like that. Your group obviously does research in this area to know where the problems are. Do you have a top five? Perhaps you could break it down in terms of the top five world issues with food waste and also, if you have it, the top five in Canada in terms of food waste.

[Martin Gooch]

I haven't consciously thought this out, so I will do this from memory.

One issue would be lack of coordination. There is a lack of coordination along the value chain. Compared with other industries, the agrifood industry has lots of poor organization for various reasons, one of them being just the culture.

There's a lack of planning. We have a lot of unnecessary loss from food processing, from pre-distribution, from incorrect handling and incorrect storage. If you include in food waste the unnecessary use of feed, it comes back to incorrect processes on farms with livestock production and some crop production.

Those same top three or four exist around the world. I see it whether I go to developed countries or developing countries. They are generally the same. It's often a combination of lack of technology or correct use of technology and lack of effective management. There are examples around the world of people who are doing it really well and of people who are on the cusp of doing it well but who know they can do it better. There are some great cases and examples we can share to encourage others to do the same.

[Bob Zimmer, Conservative, Prince George—Peace River, BC]

This is a pretty broad question as well, with a pretty broad theme, in terms of what you've said. We know that food waste occurs. What percentage of the food that arrives is used effectively and what percentage is not used effectively and expires? Is it 90:10, or 80:20...? It's a broad range, because you talked about a lot, such as animal feeds and other things. But perhaps you could give us your two bits on that, if you don't mind.

[Martin Gooch]

It depends on the product type. In perishable fruits in particular, you will tend to get a higher level of waste than you will in products that aren't quite so time- and temperature-sensitive. I've seen studies where—

[Bob Zimmer, Conservative, Prince George—Peace River, BC]

What would be the percentage number for that?

[Martin Gooch]

Commonly, or reasonably commonly, it's 20% to 30%. I've seen it as high as 75%.

[Bob Zimmer, Conservative, Prince George—Peace River, BC]

How about the other areas that you talked about? You talked about animal feed. Maybe you could explain what part of that is waste. You mentioned incorrectly utilized feed. Could you just explain that statement?

[Martin Gooch]

That's primarily the term of waste from a lean-thinking perspective, which is optimizing the use of all resources. For instance, we know there's a difference in the volume of different types of barley fed to certain breeds of animals, such as certain breeds of cattle, so you're choosing the best variety of grains for the most appropriate genetics in the most appropriate production system.

There are great examples of where it's occurring around the world. We just developed a video on a case study where two years ago the Beef Farmers of Ontario, through a U.K. initiative, reduced the cost of producing a finished beef animal by approximately $400 per head. The primary way they reduced that was by better using the feed more effectively.

[Bob Zimmer, Conservative, Prince George—Peace River, BC]

Sorry—I don't have much time, but that's very interesting, and it would appeal to a lot of our farmers.

So how does your organization proceed? Do they go after companies and corporations and say, “Look, we have a plan for you that would help you reduce waste”? Or have you set up shop and you expect them to contact you? How does the process work with how you function as VCM International?

[Martin Gooch]

It's both. We reach out to companies we think we can help, and companies come to us. We have a long-standing relationship with organizations, both private and public businesses, and I value our relationship with them greatly. There are a lot of businesses trying to do great things. There are also a lot that are so busy and distracted by things that it's hard for them to put their head above the parapet.

[The Chair, Conservative, Bev Shipley]

Thank you very much, Mr. Zimmer.

We'll now go to Mr. Hoback for five minutes, please.

[Randy Hoback, Conservative, Prince Albert, SK]

Thank you, Chair. This is a very interesting discussion.

I'll be a little bit of a devil's advocate here. As a taxpayer here in Canada, I wonder why I should be concerned about food waste. If I look at Canadian issues versus U.K. issues, is the issue in the U.K. what to do with the waste and where to put it, or is it basically how to use that waste up? Or is there an economic benefit for the chain and for the consumer in seeing it reduced? What is the driver to say, “Hey, we should take a really strong look at this”?

Maybe just help me get through that.

[Martin Gooch]

From the U.K. perspective, Peter Whitehead would be the best person to answer this. I will answer it as a third party and from what I've seen around the world.

It's primarily from an economic and environmental perspective. The sums are there. There is a growing body of evidence that shows it's worthwhile for public institutions and governments to invest some resources. In the U.K. the government effectively made a handsome profit on the investment they put into the Food Chain Centre. They've looked not only at how businesses have actually transitioned, but just for the businesses they have measured, which are not the wider industry, at what the businesses have done with it. As well, of course, their increased profitability leads to increased taxes. So you get a return on the investment from a tax perspective as well as an economic export, and people will look up to you. They look up to the leading industry.

Earlier we mentioned traceability. Two months ago I was in Australia with the Beef Farmers of Ontario, looking at their cattle traceability systems. Countries are actually approaching Australia, paying more for their cattle at times, because they see them as a real quality supplier of cattle.

[Randy Hoback, Conservative, Prince Albert, SK]

How do you handle this kind of scenario? Let's say I run a grocery store, and I look at the shelf and see that my bananas are going to be coming to their best-before date sometime in the next week. So, I discount them to get them out. If I do that, then a consumer—and I'm guilty of this myself—will go and buy 12 bananas and eat really only four or five of them. The next five or six end up in the freezer for banana loaf. How do you prevent that from happening in the chain, so they don't just discount something to get it moved through? The waste still happens. It just may not happen on the retail side; it may happen on the consumer side.

Do you have any ideas or suggestions on that?

[Martin Gooch]

Part of it is about better planning and encouraging industry to move away from discounting so much. We are a heavy discounter, and heavy discounting encourages consumers to shop differently. It also encourages businesses to behave differently. So we need a greater and more coordinated approach and we need to take lessons from different industries. We can learn from different industries.

The automotive industry for years has focused on, for instance, the bullwhip effect, the demand-amplification effect. It doesn't matter if a component for a car sits on a shelf for a month. It's not going to go anywhere. The worst thing it's going to do is to go out of date because a new model comes out.

Put the typical food product on a shelf for a month and you know what will happen. Yet that is an industry that is highly focused on how to take out amplification, how to take out this continual increase and then demand and then decrease and then increase of products, largely due to the way we interact with consumers.

[Randy Hoback, Conservative, Prince Albert, SK]

Actually it's interesting you should say that.

[Martin Gooch]

It's the way we position ourselves.

[Randy Hoback, Conservative, Prince Albert, SK]

You know, I love Costco. It's one of my favourite stores. But my kids are all grown up, so when I go to Costco now and buy that big jug of peanut butter, I look at it and see it's a good price and cheaper than the one that is half the size in the local store. But in the same breath, when I get to the best-before date on my shelf at home, I've probably eaten a quarter of that peanut butter and then realize I have to take three quarters of it and throw it out.

How do you educate consumers and show them that while something may be cheaper, the reality is that they're throwing away and wasting a lot of that product, even though it is cheaper?

[Martin Gooch]

I think that's double-edged. It's partly how do we educate businesses not to focus on that, and also how do we educate consumers not to do it. It's a hard nut to crack. All that comes down to is that we need to make a business case for this. We have very clever retailers.

[Randy Hoback, Conservative, Prince Albert, SK]

It's an interesting thought process. I'm not disagreeing. It's just the whole concept is that the more you buy the cheaper the price per unit. That's the way the system's set up. If I buy 24 eggs it's going to be cheaper than buying 12 eggs. How do you change that mentality? That's not very simple or easy to change.

[Martin Gooch]

It's not easy. One of the ways is to encourage consumers to take notice of how much they waste and translate that to money. Since I and my family have been involved in the food waste topic for the last three or four years we've changed our habits, not because we're environmental junkies or tree huggers, but because it makes financial sense.

[The Chair, Conservative, Bev Shipley]

Thank you very much, Mr. Hoback.

With that we're going to conclude our questions to the witness today.

Dr. Gooch, I want to thank you very much for taking the time and joining our committee today as we look at the supply chain, the retail sector, and food waste prevention.

Committee, we'll recess for a minute and then I want to come back because we have a quick in camera item to deal with.

Thank you very much.

[Proceedings continue in camera]