Evidence of meeting #39 for International Trade in the 39th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was producers.
A recording is available from Parliament.
10:30 a.m.
Past-President, Canadian Agri-Food Trade Alliance
I'm not sure, sir, I understand the question. Are you talking about opening up wheat markets for Canadian producers?
10:30 a.m.
Past-President, Canadian Agri-Food Trade Alliance
Right now grains and grain products are the most sensitive products in the world, Clearly, to open up markets for producers like me, we have to negotiate tariffs to come down on sensitive product lines for grain products.
10:30 a.m.
Bloc
Guy André Bloc Berthier—Maskinongé, QC
We cannot favour one sector at the expense of another. Do you understand this? What is our negotiating range within this—?
10:30 a.m.
Past-President, Canadian Agri-Food Trade Alliance
You and Mr. Julian both talked about defending the interests of producers. But 91% of us are not supply management, and to protect our interests, we need tariffs and subsidies to go down around the world. Canada has an opportunity to be a leader by taking a leadership role here, actually sticking to the Doha mandate and to the July framework it agreed to--namely, trade liberalization.
10:30 a.m.
Past-President, Canadian Agri-Food Trade Alliance
The trade negotiations, the Doha mandate, the framework did not say the complete elimination of the lowering of tariffs and subsidies. It's an evolution, not a revolution.
10:30 a.m.
Conservative
The Chair Conservative Leon Benoit
We'll go to Mr. White for a very short response; Monsieur André's time is up.
Go ahead.
10:30 a.m.
Policy Director, Canadian Canola Growers Association
On the supply management issue, whatever the rules are that we set up under the WTO to allow sensitive products to happen, those rules are used by other countries that we are trying to access for our export markets, in particular canola, wheat, and other grains.
So whatever rules we want here in Canada on sensitive products, those rules will be available to protect other countries' industries, and that's where we have a problem. We can't get our products in under those current rules in some of those countries.
10:30 a.m.
Conservative
The Chair Conservative Leon Benoit
Thank you, Mr. White. Merci, Monsieur André.
We'll now go to Ms. Guergis, for five minutes.
10:30 a.m.
Conservative
Helena Guergis Conservative Simcoe—Grey, ON
Thank you, Mr. Chair.
I have three questions. The first will be for Mr. White and Mr. McCreery and the next for Mr. Shauf and then Mr. Laforge. I'm going to give you all the questions, so I can get them out before answers.
Canada has not made any progress on trade liberalization since 2001. I don't need to be telling any of you that, and of course Canada is at a disadvantage compared to many other active countries like the United States. The U.S. is actively pursuing bilateral trade agreements with other countries and has signed agreements with Australia, Morocco, and the countries in the Americas. I'm hoping you can tell me about the impact of these agreements on Canadian agriculture. Do you think Canada should sign agreements with these countries, and should Canada work a little more closely or alongside the United States when they're negotiating future agreements?
Mr. Shauf, it's my understanding that the majority, about 80%, of your products are exported. You're in the province of Saskatchewan. Would you say the majority of the producers in your province want free trade or more trade restrictions? Further to that question, what is your position on the Wheat Board?
Mr. Laforge, at the beginning of your announcement, I heard you say you are representing 15,000 dairy farmers. When supply management started, 42,000 farmers were under supply management. If supply management is so good, why are we seeing such a reduction in the number of farmers?
We can start with you two.
10:30 a.m.
Conservative
The Chair Conservative Leon Benoit
Go ahead, Mr. White, please. Could you all make your answers quite brief? You have three minutes to answer all those questions, so go ahead.
10:30 a.m.
Policy Director, Canadian Canola Growers Association
Okay. I'll be very brief.
Thank you for the question.
Yes, we have not made much progress on trade liberalization. The question comes down to the bilateral opportunities. We have to maintain focus on the WTO. That is the entire answer to the problems we have. Bilateral opportunities are out there, but those negotiations are every bit as tough. We shouldn't kid ourselves that the sensitivities disappear as soon as we go into a bilateral, because they're still there. If we're going to negotiate hard, I'm worried about taking resources away from our efforts on WTO. Should we be working more closely with the U.S.? We definitely have to keep track of what's going on out there. We have to get our own bilaterals in order as well. But please don't take any resources or focus away from the WTO, because that's where the real answers lie for us.
10:35 a.m.
Conservative
The Chair Conservative Leon Benoit
Ms. Guergis also asked about the impact on Canada of the United States signing those bilaterals.
Mr. McCreery, it looks as if you're ready to answer that.
10:35 a.m.
Past-President, Canadian Agri-Food Trade Alliance
Yes, and you brought up the number of producers. CAFTA does represent about 172,000 producers, if you include the pork producers out west, the beef producers across Canada, and the grains and oilseed producers.
But let's talk about the impact. Let's talk about what happened when the United States signed an agreement with Morocco. I remember the former deputy minister saying we're not going to waste time with Morocco, and I was quite devastated by those comments, because Morocco is the gateway into Africa for grain. So by us not being there and the Americans having preferential treatment, they have a leg up on us going into Africa with grains and oilseeds products.
An agreement could hurt our friends in the soybean industry and the canola industry because of a bilateral between Mexico and Japan that will allow product to flow through the United States and Argentina through Mexico to Japan to give our Japanese competitors a leg up.
Those are just two very quick examples. We can talk about the CAFTA agreement and how it affected the sugar industry.
So, yes, there are devastating effects. I already said bilaterals are a double-edged sword. It's a great party to be at, but if you're not there, it's a very bad thing. But the way to overcome that is to negotiate strong rules across the board for 150 countries, not one-offs.
10:35 a.m.
Second Vice-President, Canadian Federation of Agriculture
Thank you. You asked if our producers want free trade. Our producers want fair trade. They want access to profitable markets. Our producers will take 5% clean access that gives them some profitability in that marketplace, well over some philosophical 30% reduction of a 400% tariff that gives them nothing. Our producers want access to profitable marketplaces.
Our position on the Canadian Wheat Board is that producers, not other countries, not government, should be the ones who decide and have a vote in that.
10:35 a.m.
President, Dairy Farmers of Canada
As far as the number of reductions per farm, down from 42,000 to 15,000, there are a number of elements. The rationalization of the dairy farm has not been any different from the general farm population. I think production per cow increased, based on a mature market, and has created people exiting the industry more, probably, than we would like.
As an example, on my farm in 1980, I was milking about 20 or 25 cows. Today, I'm milking 85 cows. If I had the same production base, the quota base today as in 1980, I would have to milk 240 cows. The production per cow has tremendously increased in a mature market, so it explains some of that.
The thing that we must not confuse, though, is that when we talk about 15,000 farm units, that is a lot more than 15,000 dairy farmers. Most units today are in the vicinity of 65 or 75 cows, and you have either two brothers and wives on it, or a father and mother and wife and husband, a boy or a daughter and a partner on it. As I say, it's a combination of at least two households. In some cases, it may be up to four households. These are all dairy farmers, but we're talking about 15,000 units. I wanted to clarify that.
10:35 a.m.
Conservative
The Chair Conservative Leon Benoit
Thank you very much everyone, and Ms. Guergis.
Who will we have asking questions from the New Democratic Party on the second round? Mr. Julian?
10:35 a.m.
NDP
Peter Julian NDP Burnaby—New Westminster, BC
Mr. Chair, it's very kind of you to ask. I'll be asking this last round of questions. Thank you very much.
10:35 a.m.
NDP
Peter Julian NDP Burnaby—New Westminster, BC
I'd like to come back and, a little like Ms. Guergis, give you the questions and give you time to answer them.
First, coming back to the dairy farmers, on the issue of the CITT and the CBSA and the fact that you don't have standing, what have you done in terms of trying to approach those tribunals, what recommendations would you provide to us, and how does the mandate have to change?
Then to all the witnesses, I'd like to come back to this issue of the Wheat Board and supply management. These are very, very important issues for agriculture communities. The United States has been very aggressive in saying we have to do away with the Wheat Board. The government seems to be going down that unfortunate path and reducing to virtually nothing our supply management sector. So I ask each of the witnesses whether you would agree with that American position, to do away with supply management and the Wheat Board.
Then my last question, again to all the witnesses, is on value-added. How do we move from exporting agricultural products to exporting value-added? Regardless of the tariff issues, that is something that is part of domestic policy. Do you have any recommendations on that?
December 5th, 2006 / 10:40 a.m.
President, Dairy Farmers of Canada
Based on CITT and CBSA, there is ongoing revision of CITT. I don't know if it's from our criticism of it or not, but there's a lack of logic. For example, in the context of butteroil/sugar blend, we argued that butteroil/oil sugar blend was displacing butter fat and displacing butter, because we can't use butter in the making of ice cream. They said, “Well, you cannot basically use butteroil/sugar blend to spread on toast.” In a simple nutshell, that's how they made their decision.
In the case of milk protein concentrate, they said that up to the 85% figure, it was a milk protein concentrate; over 85%, the traders call it a milk protein isolate. It's the same product, although one is a heavier concentration. It is the same thing being used for the same thing.
At some point, we say, there has to be some common sense put into the decision-making, because traders will do almost anything to bypass the rules. And I think this applies to CBSA. The CBSA has to be a lot more fine-tuned when there are dairy ingredients coming into the country.
We have also recommended that we have some kind of structure, a committee or panel, so that when there's a new demand made on a dairy product or a usage that has dairy ingredients, the committee is exposed to it, so there's a clear.... Between the scientific world and the technology and a customs officer, a lot can be lost. So we kind of want them to review their structure and apprise us of what their decision-making is.
10:40 a.m.
Conservative