House of Commons Hansard #55 of the 41st Parliament, 1st Session. (The original version is on Parliament's site.) The word of the day was farmers.

Topics

Marketing Freedom for Grain Farmers Act
Government Orders

4:55 p.m.

NDP

Ryan Cleary St. John's South—Mount Pearl, NL

My apologies.

[The Prime Minister's] crime legislation that triggered last spring’s election could pass through the Commons this week as it makes it way to becoming the law of the land - and Canadians still don’t know how much it costs.

We do not know how much it costs. How does that make sense? We do not know the cost to the Canadian economy of eliminating the Canadian Wheat Board. That is not good enough.

Marketing Freedom for Grain Farmers Act
Government Orders

4:55 p.m.

Conservative

John Weston West Vancouver—Sunshine Coast—Sea to Sky Country, BC

Mr. Speaker, I have a question for my hon. colleague across the way. My father won the world championship in alfalfa in 1958. He grew the grain in northern B.C., in Fort St. John, and went to Toronto to collect that award. If he were here today, he would ask why he could not be equal with farmers in Ontario who have the freedom to market wheat and alfalfa as they see fit and why he could not have the liberty to do the same?

My question is simple. Why does my friend across the way not like liberty and equality?

Marketing Freedom for Grain Farmers Act
Government Orders

4:55 p.m.

NDP

Ryan Cleary St. John's South—Mount Pearl, NL

Mr. Speaker, I thank the hon. member across the way for the question and congratulate his father on that 1958 award.

What I know is this. My home province of Newfoundland and Labrador does not have a marketing arm. It has individual companies that try to market, brand and sell fish, and to date it has not worked. Its industry is but a shadow of its former self.

There was a complete review of the Newfoundland and Labrador fishery just carried out, a memorandum of understanding, and one of the principal findings of that MOU was that there should be a marketing arm established to brand and market Newfoundland and Labrador fish because it has not worked piecemeal.

It has not worked with individual processing companies selling and marketing their own products. It has not worked, so Newfoundland and Labrador is moving toward a marketing arm for its fish. If it works, if Newfoundland and Labrador fishermen are stronger as one, I would say to the hon. member across the way that the same would hold true for prairie farmers.

Marketing Freedom for Grain Farmers Act
Government Orders

5 p.m.

Liberal

Marc Garneau Westmount—Ville-Marie, QC

Mr. Speaker, my colleague brought up a very good point, which is whether this decision to do away with the single desk is based on any extensive study of the situation. I have not personally seen it. Yes, it is often brought up by members of the government that this is in the name of marketing freedom and I am sure there are some farmers who want the freedom to market their grain. They all have a few acquaintances who have spoken to them and said that they would like to market their grain independently. However, there is also a large number who, for whatever reason, have voted not to go that way and they are concerned that if the Canadian Wheat Board is no longer a monopoly, they will be worse off.

How does the government make the decision? Is it based on its friends saying that it is a good thing to have market freedom or is it based on a serious study that shows that overall, when this legislation is adopted, all farmers or at least the majority of farmers will be better off in this country?

Marketing Freedom for Grain Farmers Act
Government Orders

5 p.m.

NDP

Ryan Cleary St. John's South—Mount Pearl, NL

Mr. Speaker, that is a very good question. From day one, since this legislation was introduced in the House of Commons, New Democrats have asked for a cost benefit analysis. Has a cost benefit analysis been carried out? The answer is no, it has not been carried out.

In the absence of a cost benefit analysis, in the absence of hard and fast numbers as to whether the Wheat Board fulfills its mandate and western farmers would be better off marketing and selling their wheat through a Canadian Wheat Board, this is pure speculation.

The fact is that in these uncertain financial times, with what is happening in the European Union and our partner to the south, the United States, the Conservatives are taking an incredible chance with the western economy by trying this experiment. In the absence of hard and fast numbers, and a solid cost benefit analysis, that is all this is: an experiment.

Marketing Freedom for Grain Farmers Act
Government Orders

5 p.m.

Conservative

Brian Storseth Westlock—St. Paul, AB

Mr. Speaker, I will be splitting my time with the member for Etobicoke—Lakeshore, the member who is also from St. Paul originally. We are proud to have him speak on the Canadian Wheat Board.

I would like to take a couple of minutes from my prepared text to respond to a couple of things that my hon. colleague before me talked about. In fact, there was a report done. It was one of about five that was brought up at the Wheat Board committee that said that western Canadian farmers would actually benefit by approximately $450 million to $628 million a year by gaining marketing freedom. That is not even taking the inefficiencies of the Canadian Wheat Board into account. That is not even talking about more jobs through value-added sectors. That is just talking about money that could potentially be in farmers' pockets. So just because the hon. colleagues across the way choose not to read the reports does not mean that they have not been done.

The other aspect I would like to point out is this is a very serious issue for western Canadian farmers. This is something that my producers in the Westlock—St. Paul region are counting on for August 2012. For hon. colleagues across the way to get up and ramble on about talking points that they use about government crime policy has nothing to do with jobs and money in the pockets of western Canadian farmers. I find that absolutely offensive.

In fact, I am not knowledgeable about a marketing fish board in Newfoundland, but if I were to vote on it in the House of Commons, I would definitely take the time to at least talk to some fishermen from Newfoundland.

I ask my hon. colleagues across the way, and there are going to be many western Canadian farmers here this week, to please take time and talk to them. Talk to them about what they see in opening up the Canadian Wheat Board and allowing farmers to have the option for marketing freedom while still keeping the Wheat Board in place for other farmers who want to use it.

I am honoured to speak to the bill. Our government's top priority is the economy in which the agriculture industry plays a vital role. We believe that all Canadians should be able to position their business to capture the marketing opportunities that are open to them. When passed, this legislation would provide western Canadian farmers with the same freedom and opportunities as other farmers in Canada already enjoy. That is the freedom to market their grain, based on what is the best for their business, to the buyer of their choice.

On October 18 the hon. Minister of Agriculture introduced legislation that aims to give farmers the right to choose how to market their wheat, durum and barley independently or through a voluntary Canadian Wheat Board. The marketing freedom for grain farmers act would give every farmer in western Canada the freedom to choose how to market their grain. Whether that is to a buyer who pays the full price on delivery, or through a pooled offer by the Canadian Wheat Board, our intention is to have this open marketing system in place for August 1, 2012.

However, as soon as the bill receives royal assent, it will allow farmers and grain companies to enter into forward contracts for the purchase or sale of wheat, barley, durum for the execution after August 1, 2012.

As we all know, nothing good ever comes easily. Change brings challenge, but it also brings a wealth of opportunity. Our government is working diligently with industry to make the road to an open market as smooth as possible, so farmers can capture as many of these opportunities as possible.

During our extensive consultations, industry has raised a number of valid issues around the transition process.

Over the summer a working group comprised of experts in the field met with a wide range of industry players. It heard a broad range of advice on how the grain marketing and transportation system could transition from the current CWB-run system to an open market that includes voluntary marketing pools and it released its report in September. The report does an excellent job of addressing the major transitional issues faced by the sector.

The group focused on a broad set of issues affecting the grain handling and transportation system including: access to elevators, rail and ports; access to producer cars and short lines; funding market development and research; price transparency; and tools for price discovery.

On the issue of access to port terminals, the working group examined this issue in some detail. It expects that grain companies will be actively competing for grain volume in an open market. Grain companies need volume and they have gone on record saying that they will offer access to get it.

Grain companies already offer handling services at ports to third parties that do not own elevators or port terminals, many of which are direct competitors.

There will be an adjustment, there is no doubt, but some producer groups are already showing they can compete and add value for farmers by forming alliances and synergies through the chain. For instance, some inland terminals are co-owners of the Alliance Grain Terminal in Vancouver, and others have relationships with line companies.

These commercial relationships provide a win-win situation. They benefit farm members. It is already happening and it will continue to happen under marketing freedom.

On the issue of rail access, our government knows that proper rail service remains absolutely vital to doing business.

That is why the working group recommended that the Minister of Transport, Infrastructure and Communities continue the implementation of the rail freight service review initiatives.

We recently announced the appointment of Jim Dinning to lead a facilitation process to enhance rail freight service. Mr. Dinning brings a depth of experience and expertise in building consensus among industry leaders and government.

I would add that the industry also welcomed this announcement. “We are pleased to see the action plan set in motion”, said David Nobbs, chair of Pulse Canada. Rick White, general manager of the Canadian Canola Growers Association said, “We are very pleased that the Government of Canada has taken steps to implement the first of four key recommendations, and we look forward to working with Mr. Dinning during the facilitation process”.

The facilitation process will bring together shippers, railways and other key players to develop a template for service agreements and a streamlined commercial dispute resolution process. This was one of the key aspects that our shippers asked for when the level of service review was first undertaken.

Once the facilitation process is complete, our government has committed to tabling legislative changes that will give shippers the ability to establish agreements with the railways, promoting more predictable and efficient services.

On the issue of producer cars, the right to producer cars is protected in the Canada Grain Act, and the Canadian Grain Commission allocates these cars to producers. This will not change under the marketing freedom act.

The Canadian Wheat Board monopoly has no bearing on access to producer cars and our government will continue to protect producers' interests.

Under the new rules, producers and short lines will be able to make commercial arrangements with grain companies or the voluntary Canadian Wheat Board to market their grain.

Short line railways are expecting some adjustments as they will have more options of marketing partners for the grain volumes they can attract from producers, but already we are seeing some exciting partnerships. In Saskatchewan, for instance, the province's 12th short line railway was announced just recently.

There is no question that producer cars and short line rail will continue to offer an alternative to those producers who wish to use them.

Marketing choice for western Canadian farmers is not just about keeping a promise to our base, a promise that we have been making for over 10 years to western Canadian farmers. It is about modernizing our grains and oilseeds industries as well as our rail sector, and helping farmers continue to drive our economy.

I come from a part of rural Alberta that has been blessed with some of the hardest working, most entrepreneurial people in all of North America, if not the world. The people of Alberta, but in particular Westlock—St. Paul, despise handouts. In fact, most of the time they just want the government to stay out of their way.

My Grandfather Storseth was a perfect example. He left Norway and was willing to work hard and take some risks to get ahead in Canada. He was a farmer who broke his land with his own hands. He also trapped to help provide a living for his friends and neighbours. It is interesting, even back in the 1950s farmers had to work off-farm to earn a living.

When World War II started, he enlisted, and when his time overseas was finished, he came home to his farm in Fort Assiniboine. He never expected the government to give him a handout, but he did expect the government not to regulate him out of existence, not to tell him to whom he could and could not sell his products.

This is not a unique story. It is the story of many rural Albertans. As I said, we are a hard-working people who know that agriculture has always been the backbone of our economy. When the oil and gas booms come, the agriculture sector is the steady hand that continues to feed our province.

The changes that the Minister of Agriculture and Agri-Food and Minister for the Canadian Wheat Board is making in Bill C-18, the marketing freedom act, will help provide for that marketing freedom and will help provide a strong, stable economy.

Marketing Freedom for Grain Farmers Act
Government Orders

5:10 p.m.

Liberal

Kevin Lamoureux Winnipeg North, MB

Mr. Speaker, if the member were to listen to what the average prairie wheat farmer is saying, he or she is saying that farmers do want to keep the Wheat Board; they see the value. I have said this on a number of occasions. I am sure he could sympathize with the farmer who says that a majority of the wheat farmers want to retain the Wheat Board, yet the majority Conservative government is taking away the Wheat Board. The government's argument is that it wants to provide freedom and that the bill is all about freedom.

For the Wheat Board farmer who produces milk and sells wheat, does that freedom apply to both, equally?

Marketing Freedom for Grain Farmers Act
Government Orders

5:10 p.m.

Conservative

Brian Storseth Westlock—St. Paul, AB

Mr. Speaker, it would be interesting to note that my position on the questions he asked has not changed.

The opposition, particularly that member, continues to stand and say the Wheat Board is going to be eliminated. It is not. The Wheat Board will still be in place for western Canadian farmers. What they will also have is marketing freedom. When they put in their crops, when they hope for rain and hope that they do not get hailed out, and then do all the work before winter comes to get the grain in their bins, some of them want to get paid that year. They do not want to wait a full year for the Wheat Board to pay them. Some of them want to access open markets so they can get better money. Some of them want to use the board as a risk management tool. This will all be available to western Canadian farmers.

It is not helpful for members of the opposition, for their own political purposes, to try to create fear in western Canada by saying that the board will be eliminated when, in fact, that is not true.

Marketing Freedom for Grain Farmers Act
Government Orders

5:10 p.m.

Blackstrap
Saskatchewan

Conservative

Lynne Yelich Minister of State (Western Economic Diversification)

Mr. Speaker, there has been misrepresentation of the facts. It was said that the minister had asked Canadian Wheat Board chair Allen Oberg to put the interests of farmers first, ahead of their own, long before it went ahead to work against the minister.

Would the member speak to the outreach efforts that the minister had made to ensure the Wheat Board was in fact invited and supposed to be part of the solution?

Marketing Freedom for Grain Farmers Act
Government Orders

5:15 p.m.

Conservative

Brian Storseth Westlock—St. Paul, AB

Mr. Speaker, the hon. minister is absolutely correct. The Minister of Agriculture and Agri-Food has done several outreaches, and our government has done many outreaches, to ensure that we had a smooth transition process moving forward.

I am very upset. The fact is that this could have happened a lot more smoothly, a lot more cohesively if, after we announced after May 2 that we would be moving forward with this, Mr. Oberg and the Canadian Wheat Board had helped facilitate the process rather than trying to burn the house down before they were out of it.

In fact, our government will continue to move forward with marketing freedom for western Canadian farmers because it is the right thing to do for western Canadian farmers and for our economy.

Marketing Freedom for Grain Farmers Act
Government Orders

5:15 p.m.

NDP

Pierre-Luc Dusseault Sherbrooke, QC

Mr. Speaker, the answer I got to my earlier question to the Minister of State for Finance was quite interesting.

I asked him if there were any sources of support, other than his friends, that would argue for this bill. He replied that the studies were his own personal experience. Once again, I would ask him if there really have been studies that have determined that it would be profitable for all farmers. If there are, and I strongly doubt it, I would like the hon. member to tell us about them, to prove that this bill and this change in our society will be profitable for all Canadians and all western farmers.

Marketing Freedom for Grain Farmers Act
Government Orders

5:15 p.m.

Conservative

Brian Storseth Westlock—St. Paul, AB

Mr. Speaker, as I stated in my speech, the 2008 Informa report clearly outlines the benefits to western Canadian farmers. In the Wheat Board committee, the working group took a look at about four other reports and tabled them. This is available if the member is truly interested in the benefits to western Canadian farmers. The Informa report said about $450 million to $628 million a year would be put directly into Canadian farmers' pockets. That is a tremendous amount of money for our farmers.

It is important to note that western Canadian farmers are asking to have both options, and that is what we are giving them. We are giving them the Canadian Wheat Board, the interim board that would be there, but we are also giving them marketing freedom. I fail to see how the member sees a downside to that.

Other than some little, hand-drawn chart that the member for Winnipeg Centre held up, the opposition has not shown us any proof that this would be detrimental to the western Canadian economy.

Marketing Freedom for Grain Farmers Act
Government Orders

5:15 p.m.

Conservative

Bernard Trottier Etobicoke—Lakeshore, ON

Mr. Speaker, I am pleased to address the House today as we open an exciting new chapter on the great story of agriculture and the food industry in Canada.

Our government's top priority is the economy, in which agriculture plays a key and vital role. We believe that all Canadians, including farmers, should be able to position their businesses to capture the marketing opportunities that are open to them. We do not believe in the coercive powers of the state to tell people how to sell the products of their own work. We also do not believe in jail terms for western producers who sell their grain to whomever they want.

That means giving western Canadian wheat and barley farmers the freedom to make their own business decisions, including when and to whom they sell their grain. It also means giving food manufacturers in the rest of Canada, including the riding of Etobicoke—Lakeshore that I am proud to represent, better access to western wheat and barley so that they can compete globally.

The proposed legislation is about promoting entrepreneurship, innovation and forward thinking; skills that over the past 100 years have made Canada's Prairies the breadbasket of the world. These are skills that have helped agriculture lead the way in driving Canada's economic recovery.

However, for too long, 68 years to be exact, western Canadian grain growers have been held back from bringing these skills to grow new opportunities in their wheat, durum and barley fields. Antiquated Canadian Wheat Board legislation designed for a different time and different circumstances, World War II to be more precise, has cast a chill on innovation and marketing savvy on the Prairies.

Over the years we have seen farmers and other entrepreneurs seeking to add value to their crops by investing in processing beyond the farm gate. They ran into rules requiring them to buy back from the board the very crop they paid to grow, fertilize and harvest. As a result, we have seen a number of processors set up shop in the United States and Asia instead, taking the jobs, growth and export opportunities south and east with them.

I cannot think of an industry that could thrive under this kind of red tape. It is no wonder that non-board crops like oats, canola and pulses have taken off, as they are not subject to the Canadian Wheat Board's stifling web of rules.

Paul Orsak, a farmer near Binscarth, Manitoba recognizes this. He said:

It's not just about marketing choice and finding a competitive bid for my grain. It's about commercializing the industry as opposed to having it stagnate under a heavy wet blanket of a government agency which interferes with market signal and people's willingness to invest.

Those who are looking for an economic analysis need only listen to the Canadian Chamber of Commerce when it said:

The current single-desk model restricts valued added investment in wheat and barley, significantly diminishing the ability of farmers and industry to respond to market demands and earn a premium return in recognition of the innovation provided, including innovation in value-added processing.

Look at the success story of oats when they came out from under the monopoly. In Manitoba alone, the acreage of oats has increased by 200,000 acres since its removal from the Wheat Board's control. This has allowed for the opening and expansion of Can-Oat in Portage La Prairie, Manitoba which employs 125 people in value-added manufacturing jobs.

Let us talk about the potential of new jobs and hundreds of millions of dollars in value-added investments that could come to Canada.

I would remind members that the food processing industry in Canada is a major economic driver. It is our largest manufacturing sector in the country with $90 billion in sales last year and record exports exceeding $20 billion. It has outpaced the rest of manufacturing in terms of growth in sales, GDP and labour productivity in the past five years. It is Canada's largest manufacturing employer generating 270,000 jobs. It is the largest customer for Canadian farmers purchasing almost half, or 45%, of their production.

These are the types of value-added industries and jobs that will grow in Canada if farmers have the freedom to market their products as they so choose.

Our government is working with the entire value chain to create an open market that attracts investment, encourages innovation, creates value-added jobs and builds a stronger economy. We are committed to delivering marketing freedom to our western wheat, durum and barley growers.

Western Canadian grain farmers have already put our pulses and canola on the map with more than $4 billion in exports last year. Who is to tell them that they do not have what it takes to market their wheat, durum and barley as well? This is paternalism at its worst. Marketing freedom will breathe new life into Canada's wheat and barley industries.

Earlier this fall, Alliance Grain Traders in Regina turned the sod on a new pasta plant and hopes to buy quality Canadian durum wheat directly from our hard-working producers on the Prairies. There is no buyback to get in the way and no middleman. This is one big step forward for western Canadian agriculture and the Canadian economy. The plant opening in Regina is scheduled for next year. Alliance is already a major presence in the pulse industry here in Canada. It has pasta plants worldwide. We welcome it and we welcome its investment in the future of prairie agriculture.

Canadian durum is the ingredient of choice in quality pastas around the world, even in Italy where people know a thing or two about pasta.

Last year, durum drove almost three-quarters of a billion dollars of our agriculture and food exports. By adding more value to those exports here in Canada, this investment will create jobs and give an even greater boost to our economy.

Western hard wheat is higher in protein and suitable for certain foods. Ontario soft wheat is currently used for certain products but soft wheat must be blended with hard wheat to make Asian noddles, which are manufactured in my riding of Etobicoke--Lakeshore. A manufacturer who sells Asian noodles into the North American and Asian markets is located in my riding. The company would like to be able to buy blended flour made from both Ontario soft wheat as well as western Canada hard wheat.

Right now, the Wheat Board places restrictions on western Canadian wheat farmers to which their Ontario counterparts are not subject. Ontario wheat farmers have the freedom to sell any portion of their crop to whomever they choose. They have many different ways they can do that. They can do it by pooling, by forward price contracts or by cash pricing through the Grain Farmers of Ontario. They can sell by resting orders, by defined destination contracts and by on-farm pickup. They have flexibility and freedom to sell it how they want. It is not so for western Canadian farmers.

The opportunities for both western Canadian and Ontario wheat are as follows. They can sell that hard and soft wheat into the growing Asian market or, better yet, they can process blended mixtures into flour domestically and sell the flour directly into the rapidly expanding Asian market as 45% of the Asian wheat flour market is devoted to noodles. Ontario processors could produce custom blends and become a one-stop shop. Currently, they often need to buy wheat separately from Australia. We are missing out on opportunities for processing in Canada.

The current Canadian regime not only hurts western grain farmers but it hurts all grain farmers in Canada, including wheat farmers in Ontario.

Our government's top priority is the economy in which the agriculture industry plays a vital role. Our government remains focused on strengthening our economy and creating jobs for Canadians. We know marketing freedom will drive economic opportunities for our grain industry and the food processing industry.

By attracting innovative new ventures, an open grain market will attract investment, encourage innovation, create value added jobs and build a stronger economy for all Canadians. It will sharpen the entrepreneurial skills of our young and established farmers to grow their businesses, increase productivity and create wealth and prosperity in Canada.

Marketing Freedom for Grain Farmers Act
Government Orders

5:25 p.m.

Liberal

Frank Valeriote Guelph, ON

Mr. Speaker, I would like to ask the member opposite what his understanding is of the experience in Australia. We on this side of the House have been reading about that experience. It is always good to learn from other people who have gone through this.

Jock Munro, an Australian wheat farmer, in the Grain Matters magazine, said:

We estimate we have lost $4 billion as growers since the wheat industry was deregulated three years ago.

The loser is definitely the Australian wheat grower, and the winners are the huge companies that control the logistics chain and are end users themselves. The industry is moving into the hands of big multinationals, which is where we were 60-70 years ago. What the Australian industry has done is gone back to where it was pre-single desk.… Deregulation of our wheat industry is becoming a national embarrassment.

Western Canadian farmers should look at the Australian situation...which offers a cautionary tale. Australian farmers have seen no advantages...despite the planning and slow pace of transformation...

We were warned about this in The Economist. We were warned about this as well in The Wall Street Journal. We were warned that it would be the big multinationals that would reap the profits of this, profits that would otherwise be in the pockets of farmers.

Could the member explain what will make us different from the Australian experience?

Marketing Freedom for Grain Farmers Act
Government Orders

5:25 p.m.

Conservative

Bernard Trottier Etobicoke—Lakeshore, ON

Mr. Speaker, I thank the hon. member for Guelph for his ongoing concern for the travails and the issues of western Canadian grain farmers.

What we are talking about here is Canada and whether the state can actually jail farmers for selling to whom they want to sell. Many countries have eliminated their monopolies. This includes the Soviet Union, China and Australia.

The fundamental question is whether the state can dictate to whom people can sell the crops that they grow with their own hands. That is the important question here.