Agriculture Committee on Nov. 26th, 2013

[Voices]

Oh, oh!

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

Thank you, gentlemen, for being here.

Just furthering the discussion on GMOs, we were talking about the hope by our industry that our products will be acceptable in Europe as we undergo negotiations and regulations. In Canada we have a concept called “substantial equivalency”, where basically, if a GMO products looks, feels, and smells the same as a non-GMO, it's deemed to be safe, as is a non-GMO product.

Most of our research is industry-based, and often that's basically rubber-stamped by our government. Would it help, do you think, if we want to ensure that our GMOs are accepted in Europe, that we undertake more independent research? In other words, the government or another independent agency, apart from industry, undertakes research to look at the effects of, for example, stacked traits in corn, gene splicing, all of the traits that we currently have that basically make a plant either herbicide-tolerant or insect-resistant.

Should there be more independent research or independent studies to give us more clout when we're negotiating with the Europeans?

[Dr. Stephen Yarrow]

I understand what you're saying in terms of how the risk assessment information is generated. It is generated by the proponents, be that a private company, a public institution, or a university laboratory and so on. That's the system we have in Canada. It's exactly the same in all parts of the world, actually. The European Union is no exception. But it is the proponent's burden to prove that their products are safe by conducting research to generate information that's more or less dictated, in a sense, by the regulatory guidelines of the regulatory agencies, be it the CFIA or the European Food Safety Authority.

It's expensive to do that. It takes many years. There has been some discussion that, well, perhaps the taxpayer should pay for that in terms of independent research or through grants and so on through universities. From our members' point of view, fine, we have no problem with that. That said, a lot of our members actually do engage with universities and independent scientists to assist them in generating the very information that is delivered to the CFIA and Health Canada.

Currently we have a system where it's a bit of each. There is independent...although it's paid for indirectly by the industry, plus our member companies are also generating this information. So we already have a mixture of those two things.

I'd also submit that because of the interest in biotechnology from all sorts of directions, there's a lot of independent research going on as we speak, more and more now than there has ever been. The conclusion, as far as my reading is concerned, has always been very much the same: there have been no significant risks identified with these products, be it the independent research or be it the research of a company such as Monsanto.

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

Thank you.

I have two more questions. Hopefully I have a little more time.

Many are concerned that we're discussing this agreement but we haven't actually seen the text. Is there any concern in your organization that we should really have the text, all the details of the text, in front of us? Are you making any overtures to the government to try to get a release of the text so that we can actually see exactly what's involved for your members?

The other questions is to just ask for your opinion. One sector that's been hit by this is the dairy sector, the cheese makers, specifically in Quebec. Is it fair to sign this agreement so that our dairy farmers are competing with farmers who are subsidized? In other words, we have subsidized farmers in Europe sending cheese into Canada, competing with our cheese producers.

Hopefully you have a few seconds to answer.

[Dennis Prouse]

I'm not going to touch the supply management question with a barge pole, with the greatest of respect. We have lots of problems; I'll leave that one for others.

I can talk about the text, though. The section on the biotechnology working group—it is what it is, to borrow an expression. It's more about future work than present work. We feel that we have all the details we need now to move forward on that.

[The Chair, Conservative, Bev Shipley]

Thank you very much.

Mr. Harris, you have two minutes, please.

[Dick Harris, Conservative, Cariboo—Prince George, BC]

Thank you very much.

I'd be remiss if I didn't congratulate your organization on your choice of your new president and CEO. I know that Mr. Menzies, Ted Menzies, will lead you guys down some really incredible paths.

I have a question about the market of 500 million people that's opening up to farmers. I know that there's a tremendous amount of grains and oilseeds going to China and India now. It's a huge market there. All of a sudden we've got this new EU market, a huge market for us. How are we going to be able to fully take advantage of all the opportunity to sell into that market, when I understand that, as much as we can supply to China and India, they still want more? Where are the extra crops going to come from, the extra product?

[Dennis Prouse]

My friends at the Grain Growers of Canada will probably be in a lot better position to answer that than I would. My understanding, in speaking to them, is that they feel that the growth in the European market will be more gradual. It won't be an instant ramping up of demand from the grains and oilseeds side, whereas the demand you're seeing on the Asian side ramped up very quickly.

That's my understanding, but, as I say, the Grain Growers of Canada would be in a far better position to answer that.

[Dick Harris, Conservative, Cariboo—Prince George, BC]

Okay.

That ramp-up in Asia is still going, and they anticipate it's going to keep going that way for the next 20 years.

[Dennis Prouse]

Yes, and I would certainly categorize that as a nice problem for Canadian agriculture to have.

[Dick Harris, Conservative, Cariboo—Prince George, BC]

Yes, for sure.

Just one quick question. You talked about the GMO, the biotech of foods. There'll be an issue with the EU on sending those types of foods over there. Isn't the feedstock that we are presently producing GMO products? Yet we're going to be able to send the boxed beef and pork over there, having been fed? It's sort of a contradiction of thought there on their part, isn't it?

[Dennis Prouse]

Oh, we have those discussions internally quite regularly. As I say, if I were to try to make sense of attitudes on that, we'd be here for an awfully long time.

[Dick Harris, Conservative, Cariboo—Prince George, BC]

More politics than anything else, right?

[Dennis Prouse]

I think you're probably on to something there.

I don't think we're going to shift that overnight. Our goal here is for opportunities for Canadian farmers to grow exports and products that Europeans want, and eliminating technical barriers to moving those products over. I think the marketplace, frankly, will look after those issues in due course.

[Dick Harris, Conservative, Cariboo—Prince George, BC]

Thank you.

[The Chair, Conservative, Bev Shipley]

I want to thank you, Mr. Harris, for your intervention, and I want to thank the witnesses for coming out.

We will suspend for a few minutes and allow the new witnesses to come forward, please.

I know we have some technical stuff to address.

We'll be back in a couple of minutes. The quicker we can get reorganized, the more chance we have to ask questions.

[The Chair, Conservative, Bev Shipley]

I'd like to have everyone's attention so we can start again. Could I have your attention, please?

I want to welcome to the Standing Committee on Agriculture and Agri-food regarding CETA, from the Citadelle, Maple Syrup Producers' Cooperative, Martin Plante, director general; and from Fédération des producteurs acéricoles du Québec, Mr. Serge Beaulieu.

I will turn that over to you. We have 10 minutes for opening remarks.

[Martin Plante, Director General, Citadelle, Maple Syrup Producers' Cooperative]

Thanks, everyone, for giving us a chance to be heard today. It's very important to us.

While we have the chance to be in front of you, I will take a minute and a half to introduce us. You have the documentation.

We are a maple syrup cooperative. We belong to 2,000 families. Beyond that, we are a honey co-op and a cranberry co-op as well. We are dedicated to producing 100% pure products. This is very important, and we will talk about the quality of the product out there. We are dedicated to 100% pure products. We do not sell mixed products.

We do $90 million in sales, with 95% of that exported to more than 40 countries and five continents. We've been operating since 1925. It has been quite a long time. There are 350 employees and 2,000 families. There are 2,000 families in the maple industry. Like I said, there are families in the honey business as well, and there are families in the cranberry business.

You will find that a heart is shown on this next page of our presentation, following the three types of production. It's very significant to us and is our brand new signature, because the heart is the passion of our producers. It's the values when we trade. It's the values in the way we behave with our human resources.

In a trade show, everyone in the business sells or shows a product. We show who we are. That's our way of doing business. We've won in “Trends & Innovations” at SIAL in Toronto. We've been named Canadian exporter of the year. We've won the Canada brand award. We've won many awards from the International Maple Syrup Institute.

I've nearly finished going over what we do. We have our own stores, the Canadian Maple Delights stores, where we have a lot of different products. We do our own desserts. We create new packaging and innovation. This is why we say that we're producers of pure innovations.

Also, like I said, we are in the cranberry and the honey business, so I will cover the importance of this agreement between Europe and Canada by talking about more than one product. I will flip over to maple and then to cranberry, because it's the same reality.

The importance of the maple sector in 2009 was 13,000 jobs and almost $800 million in assets. In 2012, we were exporting almost $250 million.

Most important, this next slide shows that among the exports of maple syrup, 20% of the exports are represented by the European market already. If we take out the U.S. sales, close to 60% of the sales of maple syrup are in the European market.

This agreement is very important to us, because today we have—unless you give me a great announcement that the fees for selling in Europe are no longer there—fees of 8% for maple and 17.6% for cranberries. It's very important, because there is the U.S., and we call that the U.S. nightmare. I'll explain that to you. In the cranberry industry, there are U.S. businesses that open factories or sell their product through Chile. That has no fees. It does not create a lot of jobs in Canada.

If we let the U.S. sign the agreement before Canada, we will be hit very hard in the cranberry and the maple sectors. On the other slides, I do not want to go too far, because there is a whole lot of data, but another slide shows the growing numbers of taps in the States.

Quebec is still the leader in the system. We work together with the federation. We have a great system. We push on quality; I showed you the exports we already have, but still if the Americans sign an agreement with Europe before we do, they will dig into the volume we already have or the growth we might expect from that kind of agreement. Not that I want to be negative, I just want to give you an example of what happens when we wait until the other country signs onto something.

This shows the level of paperwork we have to fill in if I'm an organic producer-packer: in the States it's about that big, in Canada it's that big, and in Japan it's that big. Unfortunately, a U.S.-Japanese trade agreement on the organic business was signed within the last month—and you all know about that—which means that whatever paperwork we have to fill in, the U.S. and the Japanese organic certifications are becoming the same.

It's very hurtful for Canada because I know we sell maple syrup in Japan. We know that it's very hard and we know that making organic maple syrup in the States is very easy, but now they're equivalent, so that will be pretty challenging for our market. I don't want to say we did not do what we had to do. It's just an example to say we need to move on with this agreement.

I've been talking about this for so many years with our fellows in the federation, why don't we take the chance of having this agreement to protect the name “maple syrup”? If you go to Europe “maple” is written on the shelves, but it doesn't taste like it. A whole bunch of products on the shelves in Europe have been packed with no protection for the name. If they're requesting that we protect some of the names of the products coming from Europe, this agreement is the right time to do it. Maple is the emblematic logo and product of Canada. Are we going to protect it?

Just to let you know, my final word, I am talking as the CEO of Citadelle, but we have an industry association, and I spoke with everyone in the industry to make sure they agree with those statements, so all the Quebec industries are behind this statement and proposal.

[The Chair, Conservative, Bev Shipley]

Thank you very much.

Mr. Beaulieu, did you have comments?

[Serge Beaulieu, President, Fédération des producteurs acéricoles du Québec]

Good afternoon. Thank you for inviting me to testify.

My name is Serge Beaulieu and I am a maple producer from Ormstown in the Montérégie region of Quebec. I am also the president of the Fédération des producteurs acéricoles du Québec, an organization founded in 1966. Our mission is to support the economic, moral and social interests of the 7,400 maple syrup companies in Quebec. We represent the men and women who work together in order to market their product collectively. Because of the quality of their work, today, Quebec provides 75% of the world’s maple syrup production. Total Canadian production represents 80% of the world’s production.

The Fédération des producteurs acéricoles du Québec welcomes the proposed free-trade agreement between Canada and Europe as a positive development. The agreement means that tariffs on exports of maple syrup and other agricultural products to Europe will be eliminated. This will help the Canadian maple industry to break into new markets, and to set our products apart from, say, American products.

For a number of years, maple producers and processors have invested in research and development in order to develop new products and to promote the health benefits of maple syrup. For the last seven or eight years, we have been investing money we receive from the federal government and money from producers and processors into that kind of research. Each time we have conducted research into the benefits of maple syrup, it has had a positive impact and has allowed us to develop our product around the world.

In 2012, the countries of Europe represented between 18% and 20% of the market share for maple syrup and maple products exported around the world. That had a value of $48 million for a volume of 14 million to 20 million pounds of maple syrup. After the United States, Europe is the second biggest export market for Canadian maple syrup. So Europe is a major market for our industry.

For a long time, our federation has been asking federal authorities to work towards the elimination of European tariffs because their effect was to limit the volume we could export. In recent years, our federation has also held a number of promotional activities there, specifically in France, Germany and England.

Working with la Financière agricole du Québec, we have funded promotional activities in Europe by reimbursing some of the expenses of maple producers in a number of markets. More recently, with the help of the provincial and federal governments, some leading chefs have been named as maple ambassadors. As well as promoting the delights of maple products to people over there, their mission is also to use their creativity and imagination to come up with new taste experiences. This is one of the ways in which we are moving maple products to new frontiers. Simply put, we have to continue our efforts to reach new consumers in that pool of 500 million people.

However, the federation is concerned by some aspects of this agreement. If the present 8% customs tariff disappears, we hope that the savings will result in more maple syrup being sold in Europe and not in more middlemen becoming involved in distributing it. Specifically, in order to promote maple syrup sales in Europe and to fully benefit from the signing of the agreement, it is critical that financial initiatives begin now so that the volume of exports can increase.

In that light, last March, the federation submitted a funding request to Agriculture and Agri-food Canada’s AgriMarketing program. As of now, it seems that a part of the proposal will be rejected. That does not increase our chances of making inroads in this free trade environment. So we hope that the federal government will support the funding request to the AgriMarketing program in its entirety. We can then take full advantage of the lowering of tariffs in European markets. In the past, we have observed that, any time investments have been made in promoting our product, such as by having people taste it, its development has been enhanced.

That is more or less an overview of the federation's position.

Do you have any questions?

[The Chair, Conservative, Bev Shipley]

I'm sure we'll have a number of questions, so I would like to start.

Thank you for your presentations.

I'd like to start the first five-minute round with Madam Raynault, please.

[Francine Raynault, NDP, Joliette, QC]

Thank you, Mr. Chair.

My thanks to the witnesses for being with us this afternoon. As you can tell, I speak French. I come from the Lanaudière region of Quebec, and I represent the constituency of Joliette, where we have maple syrup producers.

Maple syrup is a 100% natural product whose flavour and colour vary throughout the season. In 2012, organic maple syrup made up 20% of Quebec's entire production, making it our largest organic product. However, consumers are not well aware of the distinction between organic production and conventional production.

In your opinion, what steps could be taken to allow consumers to become more aware of the distinction between these two production methods? Like everyone else, I always thought that maple syrup was a natural product.

[Serge Beaulieu]

It is natural, whether or not it is organic. The difference lies in the method of production.

With organic maple syrup, no cleaning products can be used during the boiling season. The stands of trees have to be properly maintained. Things must be monitored. There is also a list of requirements that have to be followed meticulously every day. Producing that kind of maple syrup requires much more work. That is what explains the difference between the two products.

Both are natural, whether organic or not. The difference is in the method of production. Equipment requirements are much more rigorous for organic products.

[Francine Raynault, NDP, Joliette, QC]

So, as I understand it, for 100% natural maple syrup, there is no real list of requirements to follow.

[Serge Beaulieu]

Actually, there is a best practices guide to follow. But, with the organic product, the list of requirements must be followed and recorded every day. The orchards must also be managed according to sustainability standards. There are standards for tapping. A tree cannot be tapped lower than 24 inches from the ground. Producers have to comply with a lot of standards in organic production.