Evidence of meeting #23 for Agriculture and Agri-Food in the 39th Parliament, 1st session. (The original version is on Parliament’s site, as are the minutes.) The winning word was board.
A recording is available from Parliament.
Director General, Fédération de producteurs de cultures commerciales du Québec
At this time, the regulation does not apply to those grains.
Conservative
Jacques Gourde Conservative Lotbinière—Chutes-de-la-Chaudière, QC
All right.
Have the producers chosen this method through a vote during an annual general meeting of the Fédération des producteurs de cultures commerciales du Quebec?
Director General, Fédération de producteurs de cultures commerciales du Québec
Yes. There were consultations during the annual meeting of the Federation, exclusively on wheat, and then there was a referendum separate from the annual general meeting. The referendum was held with all the wheat producers.
For the time being, producers have only decided for wheat and that's why this file has moved forward. As far as other grains are concerned, the producers do not seem to want to have a collective marketing system.
Conservative
Jacques Gourde Conservative Lotbinière—Chutes-de-la-Chaudière, QC
All right.
I used to be a grain producer. Do you think that the Fédération des producteurs de cultures commerciales du Quebec gives adequate protection to its farmers?
Director General, Fédération de producteurs de cultures commerciales du Québec
Could you repeat your question?
Conservative
Jacques Gourde Conservative Lotbinière—Chutes-de-la-Chaudière, QC
Do you think that the Fédération des producteurs de cultures commerciales du Quebec gives adequate protection to its farmers?
First Vice-President, Fédération des producteurs de cultures commerciales du Québec
Several hundred producers attend the annual general meetings of the Federation. If they were not well represented, I'm sure they would be very quickly out the door.
Conservative
Jacques Gourde Conservative Lotbinière—Chutes-de-la-Chaudière, QC
As a previous member of the Federation, I may tell that you do provide good representation to your members.
Do you believe that other grain producers' organizations could do the same thing in the other provinces?
Director General, Fédération de producteurs de cultures commerciales du Québec
The producers of the region have to want to make that decision and to have the regulatory tools to do so. Most of the provinces have passed legislation on the marketing of farm products and can implement marketing regulations. In some cases, they have limited power.
I know that Ontario has the power to do so and that it has used this power to bring changes to the wheat sector. Other provinces could do the same according to their enabling legislation.
Conservative
Jacques Gourde Conservative Lotbinière—Chutes-de-la-Chaudière, QC
My next question is for all the witnesses.
Quebec producers have a flexible and effective tool: a mixed marketing system. Couldn't the western provinces have the same tool?
Director General, Fédération de producteurs de cultures commerciales du Québec
Once the majority has decided to take charge of the marketing of its product, the others can't do as they wish anymore. Once the profession has taken a majority decision, there's no flexibility anymore.
If I can make a link with the Canadian Wheat Board, from what I understand, it's only responsible for the marketing of wheat and barley. The same thing could have been done with other grains but it was decided to limit that to those two commodities.
Conservative
Jacques Gourde Conservative Lotbinière—Chutes-de-la-Chaudière, QC
Is the Quebec system effective at this time?
Director General, Fédération de producteurs de cultures commerciales du Québec
Yes, it's very effective. The bargaining power of our producers has increased significantly. It's never perfect and we have to deal with very powerful buyers that are very concentrated, which means that we must improve our tools. Our producers are convinced that those tools allow them to obtain fair prices both for wheat and for other commodities, such as pork, as well as good terms of sale.
Conservative
Jacques Gourde Conservative Lotbinière—Chutes-de-la-Chaudière, QC
Quebec producers are willing to accept change.
Conservative
President, National Farmers Union
Thank you, Mr. Chair.
As I understand your question, or your proposition, you're sort of leading down the path of provincially run collective marketing agencies on behalf of the producers, and what you're doing is starting to go down that continuum of more and more and more sellers. Rather than having only one seller, say, in the Wheat Board region, you might have three or four if you include B.C. and Peace River. You'd have one in Manitoba, one in Saskatchewan, a different one in Alberta, a different one in Peace River and B.C. So now you've split the market up so you have four sellers all competing against one another instead of only one.
I would suggest that probably the creators of the Wheat Board and the original farmers who pushed to have this thought about that and recognized it wouldn't be as good as having one region in western Canada.
Conservative
Jacques Gourde Conservative Lotbinière—Chutes-de-la-Chaudière, QC
Since the creation of the Canadian Wheat Board, in the thirties, volumes, needs and markets have changed, as well as Canadian farming.
Should the Board make changes now in order to improve the incomes of Canadian producers, perhaps in establishing a more appropriate marketing system for the various types of grains?
Conservative
President, National Farmers Union
No, I didn't know who the question was to. But if I can respond, I don't actually think the conditions have changed very much. We produce so much grain in western Canada that most of it always has to be exported offshore. That was the case in the early 1900s, in the 1920s. A lot of our production then went to Great Britain, but it still went overseas. We're in the position now where some 80% of that grain still has to be marketed outside the country. That's a very big difference, say, between the Quebec situation and the Ontario situation and the western Canadian situation. We have to export so much of that grain.
I actually don't think conditions have changed. Farmers are still looking at four or five multinational grain companies that control that business. That has not changed since 1900, since the Wheat Board was invented.
Conservative
NDP
Alex Atamanenko NDP British Columbia Southern Interior, BC
Thank you very much for being here.
One item that we haven't talked about a lot in these hearings is value-added processing. We touched upon it, and the impression I think all of us are left with is that we need to have some flexibility and we need to change our system in order to get better value-added processing.
I'm going to throw some facts at you and I'd like your comments. I'll try to be as brief as possible.
It's my understanding that the value-added wheat and barley processing in Canada has grown significantly. Over the past few years, the domestic market has become our number one customer. In 2001-2002, approximately two out of every ten bushels of grain were processed domestically, compared with one in ten a decade ago. Canadian wheat and durum milling has increased 31%. In other words, the capacity has grown from 7,700 tonnes per day to about 10,300 tonnes.
Milling & Baking News, an internationally respected publication, says that flour production among the leading milling nations since 1990 shows that Canada's mills enjoyed the sharpest increase of any country, including the EU, the U.S., Argentina, and Australia. About 32% of this milling takes place in western Canada, in comparison to 15% in the western U.S.
Three new mills have been built in western Canada in five years alone. Per capita, wheat processing is greater in Canada than in the U.S. There are new mills being planned and built, one in Chilliwack that apparently has just started operation.
The picture I'm getting from reading this information is that the value-added industry is flourishing and that the Wheat Board is not hindering the value-added industry. In fact, in comparison with our competitors, we're doing very well.
I would like some clarification and your opinion on this, if you would, please.
President, Keystone Agricultural Producers
Certainly there has been additional processing growth in western Canada. However, I think one of the limiting factors to the growth has not been the Canadian Wheat Board but lack of an adequate trade deal at WTO for Canada to export the processed products. There are a number of items that we could certainly produce in Canada. However, we've never been able to manage to negotiate a trade deal that will encourage our processing industry to further add value.
President, National Farmers Union
The information I've seen presented at meetings is that there is more value added in the grain-growing region in western Canada than in the midwestern United States, for instance. Comparatively, value added is doing better there.
I will mention specific programs that the Wheat Board itself has put in place to encourage adding extra value in Canadian enterprises. I haven't marketed any grain this year, but luckily I did last year, so I may get a ballot in this year's Wheat Board elections.
My own grain gets a $3 a tonne premium, because it is actually milled in Canada, in Saskatchewan. That is a program the Wheat Board put in place. It is a direct benefit to me, and it encourages value-added.
As well, if the farmer is truly interested, the Wheat Board has a stock switching program that is unequalled in helping new generation co-ops or other enterprises. What this stock switching program means is that if I am farmer in the Peace River, I can buy a share in a mill in southern Saskatchewan and not actually have to deliver my own grain there. Local grain is purchased and used in that mill, but with the paper transaction, it shows up as if it was my grain going into that mill. This is a tremendous incentive for me to actually purchase a share in that operation, whatever it might happen to be.
