Agriculture Committee on Feb. 13th, 2007

[David Anderson, Conservative, Cypress Hills—Grasslands, SK]

Thank you, Mr. Chair.

I don't think the threat of CropLife walking away is a reason for me to abandon my producers, but anyhow, we can talk about that a little later. First of all, I want to thank the PMRA for the project they're going ahead with. We had quite a discussion last time you were here about data and studies being available on strychnine. Is that 2005 study available? You mentioned the 2005 study that was done to check the efficacy of strychnine. Is that available to the public?

[Karen Dodds]

That's the re-evaluation that we did of current uses of strychnine, so that is available on our website. That's a proposed acceptability for continuing registration.

There has also been a follow-up note on I think the status of strychnine. It does not deal directly with the liquid concentrate. The fact that the scientists have the same level of concern with the ready-to-use product has also indicated that you would have those concerns with the liquid concentrate.

[David Anderson, Conservative, Cypress Hills—Grasslands, SK]

I want to come back to the suspension of OUI. I know you were giving data on GROU or whatever, but GROU hasn't worked for my producers yet. They have no evidence at all that it's going to work. They're trusting the department. They're trusting some of their leaders to say it's working. On the ground, what they're saying is they want OUI to continue for awhile.

I'm confused as to why we can't, as a government, run the two programs simultaneously, insist that the chemicals that fit into the GROU program be put into that, and leave the OUI in place for the two years, as we requested. The real success of the OUI has been the price discipline it has brought to the market. Glyphosate is far cheaper than it was three years ago. Farmers appreciate that, and they want to be able to make sure they're going to be able to continue to access those kinds of prices in a fair market.

I invite your response on that.

[Gordon Bacon]

Mr. Anderson, I'll make a couple of comments on that.

On the side of narrowing the technology gap, if we have products that aren't in Canada right now—and part of this package is to use Project 914 to narrow this technology gap—we basically are going to have to have companies interested in registering products that they haven't previously had an interest in or haven't pursued an interest in registering.

When that product becomes registered in Canada, those companies are going to be interested in what kind of intellectual property protection they're going to have for this new product. One scenario could be that there is a generic of one of those products already in the U.S. There would be concern on the companies' side as to why they would want to introduce it into Canada if that product could then be brought in on the generic side almost immediately if equivalency could be proved.

So there is reason to believe we're not going to get the kind of uptake on narrowing the technology gap as long as that old OUI program is in place. As Karen mentioned, under the GROU program, if there were a generic version of one of those products in the U.S. and you deemed equivalency, you would basically have already said that the product could come in. I think that's why companies are not interested in telling us what is on the GROU list until they know the status of the OUI program.

[David Anderson, Conservative, Cypress Hills—Grasslands, SK]

I guess the farmers' response would be that if there's a generic available, why don't we have a system in place that would allow them to access it? My concern about GROU is that it ties the whole system to the fact that the registrant has to be cooperative. I don't think we've seen that in the past.

[Gordon Bacon]

The cooperation of the registrants has to be there to recognize what we're trying to move to. We're removing regulatory differences between Canada and the U.S. as a basis for price discrimination. You really have to have acceptance that we're moving to a North American pricing basis. That's why the task force and Craig have said to leave OUI at the ready, to be reintroduced if that kind of cooperation isn't there, if we don't see the kind of pricing discipline that's in place, because that is one of the key measures.

We're concerned that if we don't move rapidly on all four fronts at once, we're going to lose an opportunity to narrow the technology gap, to get a stronger generic industry in Canada, to move toward price equivalency.

We also hear the same thing. Until you have some evidence out about what products would come in under GROU—and this is just the first list—the idea would be that we should move to include all registered products, or as many as possible, where that equivalency is. But we're facing the question of what is going to be the first step, and there are some reasons why trying to have both programs in place is going to limit interest.

The second point I'd like to make is that the task force was set up fourteen months ago to address the issue of equivalency. I think PMRA has made it very clear that there are issues of equivalency that would have to be addressed, and there's also the issue of protection of intellectual property.

Until we can address the very reasons the task force was set up, I think we're faced with some challenges in trying to say we would have both programs at the same time.

[David Anderson, Conservative, Cypress Hills—Grasslands, SK]

I think one of the main reasons the task force was set up was that the price of glyphosate dropped enough that the companies were concerned about it. That was some of the primary pressure, and now hopefully we've switched and we've put enough pressure on so that we'll be able to do something jointly with the United States. We've been pushing for that for years.

I'm just wondering why Avadex and Fargo were the first chemicals given the NAFTA label? I like this idea of the NAFTA label, but those are declining products. They're ones we used a lot of years ago, and they have been fairly stagnant, if not declining, over the last few years. I see Monsanto sold them to someone else now.

I'm just wondering if any of the major companies are involved in this NAFTA labelling. Are they moving ahead with products that are current? You're talking about closing the technology gap. Are we moving on some of the newer products, or is it going to be a list of older products that...?

[Craig Hunter]

Yes, the NAFTA North American label working group has had volunteers from several of the companies bringing forward products for NAFTA labelling. The group includes a number of the bigger companies.

I don't believe the list of products the committee is working on is on the site yet, but there's actually a meeting coming up in March at which we will be talking about the next one. I think the second one will be coming out very soon, in time for 2007. There are also several more that will be coming out in the next year or two.

They're like everybody else. They want to move cautiously, but they want to move forward on this idea. It really would facilitate movement of product back and forth, especially when you have, say, a grasshopper outbreak and you use every pound of the insecticide that's available in Canada. You don't have time to rebag, relabel, and so on, so if the product is labelled so that it can move across the border as fast as a truck, then we will have had real success.

If I may, can I go back to one of your earlier statements about how the growers want OUI? I think the growers want access to glyphosate. That's really what they want, and it's a shame that the company that owns the rights to this product is the only one that refused to take part in the GROU pilot.

It's like the old story. When the piper's already playing your song, why do you have to pay him? That company is already selling all the product they want through the border, so it wasn't prepared to participate. If OUI was off the table, the company would be at the table the next day for GROU, and then glyphosate would be available. So it, too, could be available under this program. There's no question about that.

[David Anderson, Conservative, Cypress Hills—Grasslands, SK]

Do you have a program to sell this program in western Canada? You're going to have trouble if you don't have some sort of a program to sell your new program here?

[The Chair, Conservative, James Bezan]

Make it a quick response, please, because we need to move on to the next round.

[Karen Dodds]

On your first point that farmers haven't benefited from GROU, there's no way farmers can benefit from GROU until we let a product be identified as eligible for GROU with a label and it can move across the border. It can't now. We've only gone through a pilot stage. The registrants have been clear that they don't want both programs operating at the same time.

We've been clear. ClearOut 41 Plus is now registered in Canada, but the registrant has decided not to market it in Canada. They're accessing the Canadian market using own-use import, not another way. If there is a clear indication that you will hurt registrations in Canada, I don't know what it is.

They've decided not to market in Canada but to let it come in through own-use import. They're accessing the Canadian market through a different channel and are avoiding the responsibilities of a registrant.

[The Chair, Conservative, James Bezan]

We'll turn it over for our second round of questioning.

You have five minutes, Mr. Easter.

[Wayne Easter, Liberal, Malpeque, PE]

Just to be clear on the facts, under the OUI—

[The Chair, Conservative, James Bezan]

Sorry, Wayne, but I actually screwed up there. It's a rookie mistake.

Mr. Atamanenko will actually finish off the first round, at seven minutes.

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

Yes, and I even voted for you.

[Some hon. members]

Oh, oh!

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

Thank you very much, Mr. Chairman.

I don't have many questions, so we'll probably get through my part very quickly.

Mr. Hunter, one thing that keeps coming back when I talk to apple growers is the story that we're at a disadvantage. Our competitors are using chemicals that growers can't use here. Their competitors use them on the apples, yet we can import the apples. It's that story. If we took out the old OUI and implemented GROU, would that alleviate this problem?

[Craig Hunter]

The GROU program by itself would not, but the GROU program and all the other pieces of the agreement, yes, would go a long way to helping to solve that for apple growers and cucumber growers and lima bean growers and a whole lot of other people.

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

Could you elaborate a little bit and give some examples?

[Craig Hunter]

Canadian apple growers have had the worst five years of prices of all time, and it's because their cost of production is higher than the cost of imports. Part of the reason that imports are cheaper is because the competitors have access to production tools that give them a cheaper cost of production and better pest control than we do.

One really good example was a product used in apple storage to keep the apples good for 12 months. The Americans had it. Great Britain had it. China surely has it. We were not allowed to have it, but we were allowed to import the apples that were treated with it. So our guys were not allowed access. After a lot of work and a lot of expense to apple growers, we got it.

Under the new suite of programs where it would appear there is a much better chance to get simultaneous registrations, the day the Americans get the next one like that, we would get it too, because they would be interested in coming here because there would be a lot more willingness to participate. Companies are willing to come to the table now because of the way things are working that weren't 10 years ago.

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

If I understand correctly, Madam, you were saying in regard to the OUI program that there was one company you mentioned that is coming in through this program and doesn't have to register because they can come in, whereas if this did not exist, they would have to, and this means it would be registered in Canada and there would be free flow across the border. Do I understand this correctly?

[Karen Dodds]

The way I would summarize it is that own-use import was addressing price, not access. A concern from a lot of growers is that if you continue with own-use import, you are actually hurting the possibility of getting access. Both own-use import and the proposed GROU, grower requested own use, require that there be a Canadian-registered product against which you are making a comparison. So own-use import and GROU do not address an access question; they only address a price question.

In trying to develop win-win solutions, the task force went well beyond just price and got an awful lot on the table and an awful lot accepted that also addresses access. So if access is your primary concern as a grower, you are interested in all the recommendations that weren't own-use import and weren't GROU--further harmonization, the new intellectual property policy, Project 914.

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

Do you have anything else to add, Mr. Bacon?

[Gordon Bacon]

I would just emphasize the point with which I started my presentation. It was about timely access to new products and competitive prices. Those are the cornerstones of what the four areas of the task force recommendation addressed.

As Karen has just mentioned, it did go beyond just what OUI was trying to address. That's why we are very supportive of this, because it's going to bring our industry rapidly forward, increasing the competitiveness on a number of fronts.

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

Thank you.

That's all I have, Mr. Chair.