Agriculture Committee on Nov. 26th, 2013

[The Chair, Conservative, Bev Shipley]

I want to welcome everyone to meeting five. Pursuant to Standing Order 108(2), we are studying the Canada-European Union Comprehensive Economic Trade Agreement, known better as CETA, and the effects of it on the agriculture sector.

Today we have with us, from CropLife Canada, Dennis Prouse and Stephen Yarrow.

We welcome you both as witnesses.

There was to be another group, but they were unable to be here, in this schedule, so that one hour is allocated to CropLife should it go for that whole hour.

I will be breaking at the end of the meeting for a short business meeting of about five minutes, for those who are involved next week—

[Pierre Lemieux, Conservative, Glengarry—Prescott—Russell, ON]

You know that we have votes, right, at 5:15?

[The Chair, Conservative, Bev Shipley]

Are the bells at 5:15?

[Pierre Lemieux, Conservative, Glengarry—Prescott—Russell, ON]

I think so.

[An hon. member]

Yes.

[The Chair, Conservative, Bev Shipley]

I'd forgotten about that.

To the witnesses and members, then, if you don't mind, I may cut this part a little short and divide it up between the two of them so that we still have five minutes at the end.

Is that okay? I'm assuming that if it isn't, you'll let me know.

Mr. Atamanenko.

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

Did I understand correctly that the other group, the maple syrup producers, will not be here? Or are they here in the second half?

[The Chair, Conservative, Bev Shipley]

Two maple syrup groups will be here in the second half.

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

Okay.

[The Chair, Conservative, Bev Shipley]

I will turn it over to Mr. Yarrow or Mr. Prouse now for their 10-minute opening remarks, please.

[Dennis Prouse, Vice-President, Government Affairs, CropLife Canada]

Thank you Mr. Chair. We greatly appreciate your invitation to be here.

Given that there's another group that is not here, we will try to keep you entertained for as long as we reasonably can.

My name is Dennis Prouse. I'm vice-president of government affairs. Seated with me is Dr. Steven Yarrow, who is vice-president of biotechnology.

CropLife Canada is the trade association representing the manufacturers, developers, and distributors of plant sciences innovations, including pest control products and plant biotechnology, for use in agriculture, urban, and public health settings. We're committed to protecting human health and the environment, and providing a safe, abundant food supply for Canadians. We believe in driving innovation through continuous research. CropLife Canada is a member of CropLife International, a global federation representing the plant sciences industry in 91 countries.

Our mission is to enable the plant science industry to bring the benefits of its technologies to farmers and the public. Those benefits manifest themselves in many different forms, including driving agricultural exports, job creation, strengthening the rural economy, and increased tax revenue for governments.

The increased yields that farmers get when they use crop protection and plant biotechnology products do more than improve the bottom line for farmers. They also stimulate economic activity that flows throughout the entire Canadian economy.

Crop protection products and plant biotechnology lead to quality and yield enhancements that have led to 97,000 additional full-time Canadian jobs in more than 20 different sectors. Increased crop production due to plant science technology generates $7.9 billion in value for farmers of field, fruit, and vegetable crops, and creates $385 million in tax revenue for federal, provincial, and municipal governments. Plant science technologies also enhance Canada's standing as a net exporter of food. About 65% of Canada's food surplus can be attributed to increased yields because farmers had access to our technologies.

As you can see, Mr. Chair, our members are strong free traders. We know that trade and innovation are the two key pillars of growth and prosperity in Canada, and CETA supports both of those pillars. The grower groups that are members of the GrowCanada partnership also see export growth as a key to prosperity for Canadian farmers, which is why you will see strong support for CETA amongst every major grower group in Canada.

Current agrifood exports to the European Union are $2.4 billion a year. When completely implemented, CETA will eliminate tariffs on virtually all of Canada's agriculture and food products. The Canadian Agri-Food Trade Alliance believes that CETA could increase total agrifood exports to the EU by an additional $1.5 billion per year.

Across Canada, nine out of every ten farms are dependent on exports. This represents 210,000 farms and includes a majority of farms in every province. Canada's food processing sector employs a further 290,000 Canadians. Together these industries support over $44 billion in annual exports and account for 11% of Canada's gross domestic product. The fact that Canada was able to secure such broad and meaningful access to an export market as large as the European Union is a significant achievement. The fact that we did so ahead of our major competitors is even better.

There are two key issues that we would like to bring to the attention of the committee regarding our trading relationship with Europe.

The first is the inclusion within CETA of a vehicle for cooperation on issues relating to biotechnology and trade. A biotechnology working group is tasked under the agreement to address the timelines for approvals of genetically engineered products and science-based policy and regulation. The agreement also includes new mechanisms for preventing and resolving trade challenges relating to plant health and food safety issues.

For our industry and Canadian farmers, this is an important breakthrough. I don't think we have to belabour the fact that issues around biotechnology and science-based regulation have been extremely difficult when it comes to our trading relationship with the European Union. To put it plainly, we believe that European opposition to biotech crops has been used as a non-tariff trade barrier, to the detriment of Canadian exports. The fact that the words biotechnology and science-based regulation are part of CETA is very important to our sector and will allow our respective governments to have meaningful and substantive discussions to improve regulatory impediments. Canadian farmers planted close to 29 million acres of biotech crops in 2012, and adoption continues to grow in Canada and around the world. The commitment to science-based regulation ensures that Canadian agriculture will remain competitive.

However, there are storm clouds on the horizon. The global crop protection industry has serious concerns about the European Union's regulatory framework for plant protection products, in particular the European hazard-based approach to pesticide registration articulated by regulation 1107/2009. In our view, this has the potential to be a significant non-tariff trade barrier for Canadian agriculture and agrifood products.

The approach taken by the European Union changes their pesticides registration process and moves it away from a science-based approach. The European Union approach will impact not only trade in pesticides—current and future—but also in food, feed, and seed products using these pesticides. The import tolerance specified by the European Union for these products is effectively zero, so even trace amounts could prevent the product from entering the European Union.

The use of hazard-based cut-offs, as opposed to Canada's risk-based approach, will expand to include compounds categorized as endocrine disruptors. The use of hazard-based cut-off criteria has the potential for negative and far-reaching impacts on global commerce. We believe this approach is not consistent with the World Trade Organization sanitary and phytosanitary agreement, to which the European Union is a signatory.

We have concerns about the impact of this action on Canadian farmers. Growers of cereals, oilseeds, pulses, horticulture, and many other things destined for European Union markets will potentially be prevented from using a large number of safe, effective pesticides that have been assessed by Health Canada. Growers need all the tools they have as well as future innovations to combat pest problems and to feed a growing world population. Europe's actions in this area could have negative impacts on innovation and the introduction of new technologies.

We know that our American counterparts are pushing aggressively for this issue to be dealt with in their current trade talks with the European Union. We have outlined our concerns previously to Agriculture and Agri-Food Canada and International Trade, and we would ask that the Government of Canada continue to be vigilant in insisting that science-based regulation be respected in our trade relationship with the European Union.

We should remind ourselves that Canadian farmers would lose 30% to 70% of their harvests without access to the latest innovations, such as genetically enhanced seeds and pesticides. Agriculture is a tremendous avenue for future Canadian trade growth and CETA provides an avenue for Canada to both grow its agricultural exports and address regulatory challenges on biotechnology and pest control products. It's a tremendous step forward and a statement of confidence in the future of Canadian agriculture.

We thank the committee for its time, Mr. Chair, and we'd be pleased to answer any questions you might have.

[The Chair, Conservative, Bev Shipley]

We'll go to the round of witnesses.

Madam Brosseau, go ahead, please, for five minutes.

[Ruth Ellen Brosseau, NDP, Berthier—Maskinongé, QC]

Thank you, Chair.

I'd like to thank the witnesses for being with us today.

I have a few questions on this working group and the harmonizing of standards when it comes to biotechnology. What should this working group look like? Who should this working group comprise?

[Dr. Stephen Yarrow, Vice President, Plant Biotechnology, CropLife Canada]

I think there's already a relationship between the Canadian government and counterparts in the EU, including senior managers of CFIA, Health Canada, Agriculture Canada, and so on and their counterparts in the EU. We see that this CETA underscores that relationship and formalizes a working group. I've imagined that the working group would have similar representation, including experts on trade.

[Ruth Ellen Brosseau, NDP, Berthier—Maskinongé, QC]

I wonder if you could comment on how GMOs are in Canada and how they are in Europe. What role would the government have to play in overarching and building bridges in the long term. Could you comment on what kind of role can be played? Could you comment on the low-level presence and how....

[Dennis Prouse]

I'll let Dr. Yarrow speak to the low-level presence issue. He knows it far better than I.

It was interesting. I was just speaking right before the meeting, in fact, with your colleague Mr. Allen. Nowhere are we trying to change European attitudes on biotech or trying to sell them, if you will, on a particular vision. This is about facilitating trade. What had happened previously—Stephen can expand better on the details than I can—is that trade was being held up due to issues of low-level presence. In no way are we trying to prejudge the attitudes of EU member nations on those products; we simply want to facilitate trade of products they want—

[Ruth Ellen Brosseau, NDP, Berthier—Maskinongé, QC]

—and to make it work.

[Dennis Prouse]

How do we make it work? There are two separate issues here. There's the emotional debate about GM and non-GM and then there's simply facilitating trade. In our view, the biotech working group is about removing those irritants and facilitating trade.

I know Stephen can probably do a far better job than I on the issue of....

[Dr. Stephen Yarrow]

I think there's a perception that the EU is very much against genetically modified plants and certainly the extent of cultivation of such plants in the EU is very small. I think there are like 200,000 hectares of genetically modified corn grown in Spain and, actually, that's growing as each year goes by, but it's pretty modest compared to North America.

The reality is the Europeans really embrace biotechnology inasmuch as livestock feed—in other words, quite a large proportion of the corn and soybeans in North America and portions of that come from Canada—is exported to the EU to support their livestock feed industry. They demand it. The problem we have is that from time to time there will be a new corn product or a soybean product that's developed in Canada. Farmers want to access the technology, grow those varieties, but the particular trait, characteristic, however you want to describe it, hasn't yet been approved in the EU.

They have a slightly different system in the EU, where they approve things for like five years and then the approval expires, so sometimes these products sort of expire in terms of their registration. Canadian farmers are getting caught because they want to grow varieties of corn and soybeans, but it's kind of a losing playing field as to which ones they can put in the ground vis-à-vis how they're going to be received in the EU. That speaks to the low-level presence policy.

As you probably well know, the Canadian government is bravely proposing a low-level presence policy—and that's still under development—but, more importantly, they're embracing conversations with other countries, like-minded countries, that also have interests in agriculture and innovation and biotechnology as well. At the moment, it's been difficult to get the EU governments to engage in those conversations. The fact that we have this working group sort of enshrined, so to speak, in CETA gives us, in my view, a very good avenue to be able to start having conversations around lower-level presence with the European Union counterparts.

[The Chair, Conservative, Bev Shipley]

Thank you very much for your questions.

I'll move now to Mr. Lemieux for five minutes, please.

[Pierre Lemieux, Conservative, Glengarry—Prescott—Russell, ON]

Thank you, Chair.

I particularly appreciate your background in science and technology, particularly with our Growing Forward 2 and our focus on science and innovation. Clearly, we're trying to move the yardsticks forward as well within the domain of science.

I wanted to ask about science, actually. Your client organizations, the kind of organizations that you would interact with...can you perhaps share with the committee what kinds of technologies or biotechnologies have either recently come to market or might come to market in the near term that would help our farmers compete in Europe and take advantage of what CETA offers them?

[Dr. Stephen Yarrow]

I'll have a go at answering that one. Of course, just to clarify, we're from CropLife Canada. We're an association that represents the interests of members, companies that are developing these things, but they're not always going to tell us what they have in their pipeline.

[Pierre Lemieux, Conservative, Glengarry—Prescott—Russell, ON]

I understand that.

[Dr. Stephen Yarrow]

It's a very competitive process.

Also, as you know, for the last 15, 20 years, farmers in Canada have enjoyed to a large extent, with corn, soybeans and canola, traits such as herbicide tolerance and insect resistance, and so on. That has really, in some aspects, revolutionized how farming is done in Canada. That's been a great benefit for Canadian farmers, who then harvest their materials, their grains or whatever, which then can be exported to the EU.

So what's in the pipeline for the future? There are going to be more of those things—different types of tolerances to herbicides and more resistance traits to insects. Reflecting on what my colleague mentioned earlier, between 30% and 70% of crops would just be lost unless we have innovations. It's not just biotech, it's not just pesticides, but innovations such as those are very important.

Our member companies are actively looking into other avenues that will be useful for farmers, drought tolerance, for example. In fact, I think there's going to be a drought-tolerant corn variety that will be available next growing season. There will be more of those sorts of things as well. We're hearing about salt-tolerant crops. Moving further out into five and ten years' time, there may be some characteristics introduced through these modern innovations that will benefit consumers in terms of removal or minimizing the presence of allergens, modifying oil profiles, and those sorts of things.

How those things will play out in terms of the EU market, we don't know at this point. What we're seeking is sort of a level playing field in terms of how these things are regulated in Europe versus Canada, science-based regulations, those sorts of things.

[Dennis Prouse]

Just to add to that in terms of what's currently happened, canola yields are up about 20% in the last 10 years. That's a hard real number: canola yields are up 20%. That's tremendously significant and modern agriculture is what's driven that.