Agriculture Committee on April 16th, 2007

[Ross Ravelli, Director, B.C. Grain Producers Association]

Thank you, Mr. Chairman.

Good morning, members of the House of Commons standing committee. Welcome to British Columbia. Thank you for the opportunity to speak to you on the next generation of agricultural policy framework and, more specifically, the business risk management pillar, and to provide a couple of comments on the science and innovation pillar.

As the chair mentioned, my name is Ross Ravelli. I'm a grain farmer from Dawson Creek, British Columbia. I farm about 2,000 acres. I'm here speaking today on behalf of the B.C. Grain Producers Association.

The B.C. Grain Producers Association is a grains and oilseeds commodity organization representing approximately 400 grain farmers in the B.C. Peace River area. For 21 years, the B.C. Grain Producers have represented our farmers on both provincial and national issues. Clearly, we are a small organization by numbers, but not by the determination, the dedication, and the commitment of our members in agricultural policy discussions. Indeed, many of you knew one of the past presidents of the B.C. Grain Producers, and the one with whom I first became involved on the political side of farm policy. I was vice-president for Mr. Jay Hill, who has come quite a long way. However, I don't want to follow in his footsteps. I'll just put that right on the table.

I think everyone here would agree that farming is a business and needs to be treated like a business. This does not mean big farm versus small farm, or the family farm versus the corporate farm. No matter what the size of the operation we're involved in, we need to use best management practices to be as efficient and productive as we can be. Anything less would be unsustainable.

As farmers, we need to know our risks, and each farm's risks are very different. Generally, in grains and oilseeds, there are two dominant risks that we have very little control over. There is production and there is the price risk, both of which I'll touch on.

We also need to be able to identify the programs—or tools, as they're referred to now—available to us to best manage our risks, whether they're delivered through the private industry, such as crop insurance or price tools, or by government, whether it's production insurance or CAIS, for example.

To this point, I must say—and I heard the other presenters talk about it earlier—that whoever delivers them, the tools must be understandable and simple, and they must clearly identify the deliverable benefits. Program complexity will result in even the best programs sitting idle.

Farmers are the first line of defence in addressing all of these risks, and we must personally do our very best to adapt, understand, and mitigate where we can, as much of the risk as is prudently possible. Agronomically, we must keep up to date and use best management practices to allow us the opportunities to maximize our yield, our quality of product, and our farms' financial viability.

I'd now like to look at production insurance. More directly, there's a problem that I think needs to be addressed within the production insurance program if it is to continue to have farmers' support and, more importantly, if it is to ensure that the program is a relevant business risk management tool for farmers. Simply put, the ten-year averaging of crop insurance yields used for production insurance has not taken into consideration the significant yield increases that we have seen in recent years and will continue to see at a more rapid rate. This is what I call yield lag, which means that the coverages that are being offered to growers today do not reflect the reality of what is happening in the field. Canola is, of course, the leading candidate for demonstrating this lag effect, but all grains and oilseeds will show some lag.

Herbicide-tolerant crops have led to higher yields, due to less competition from weeds and because of better research and better plant genetics. These crops became available in 1996 and are now seeded on about 95% of the canola acres in Canada. The next wave is the move to hybrid varieties. Expected to be seeded on 50% of the canola acres in 2007, hybrids have a significantly higher yield potential than we've ever seen before.

Here's what this means on my farm. Ten years ago, my production for crop insurance on canola was 24 bushels an acre. Today it's 32. However, I will expect to grow 40 or more when I go to seed this spring. That's the yield I have today. Not only can I not cover the 40 bushels that I should be able to produce and will produce, I can only insure up to 80% of my 32 bushels, which is 25 bushels. In today's reality, I'm only insuring 62% of my crop. Does that seem like an effective and sustainable program? Personally, I would gladly assume the risk of the first 20% of production loss if it were to the yields I expect and anticipate to grow.

Further problems arise on the price side of production insurance. Studies by AAFC and the George Morris Centre in the late 1990s through 2001 show the depressing effect that foreign subsidies have on our prices. It's generally in the neighbourhood of a 25% drag. Production insurance and price levels are based on current projected prices at best, and are thus 25% less than they should be. Add these two negative effects to production insurance and you will see why many farmers are questioning the program.

As I suggested in my presentation on the 27th, we need some kind of innovation factor built into the base production insurance. I say the base because I think it should be available to all provinces that have production insurance. From a federal standpoint, it has to be part of the base in order to respond to the offset risks of today, not yesterday. On the price side, we need to work aggressively at the WTO to get free and fair trade for our grains and oilseeds.

I appreciate that this is indeed an insurance program and must meet the principles of insurance, but surely there must be a way to achieve not only the insurance policies, but meet farmers' needs as well.

I'd like to make a few comments in regard to the recently announced $600 million NISA-2 savings program. We know from past experience that NISA was a popular and well-understood program. However, we must provide farmers with the needed program flexibility to access and use these funds as they see fit in their operation, and then to live by what they decide themselves.

I would like to now share some of the business risk management design features and principles the B.C. Grain Producers would like to see incorporated in any new program.

First, a program must be production-neutral and not mass-market-signalled. Farmers need to be able to make their own decisions about what is best for their farms based on agronomic market signals and the risk management tools available to them, whether the tools are available through government or private industry.

Second, a program must be predictable and bankable. Without a doubt this is the biggest criticism of CAIS, as I'm sure you're all aware. The recent design changes in inventory evaluation that were made to the CAIS program are steps in the right direction.

Third, it is important that the federal programs be designed to be national in scope, and be designed in a manner that minimizes the risk of countervail or of creating different levels of support between provinces and commodities. Canadian growers rely heavily on the export markets, and we cannot risk retaliatory trade measures by foreign countries.

Fourth, we can generally support the principle of a margin-based program. However, the program design must have more flexibility to take into account the issue of commodities that have long-term price declines due to the negative effects of foreign government policies.

Fifth, any business risk management program should have positive linkages that encourage participation in other business risk management programs, but ultimately it must allow farmers to make informed business decisions based on what is best for their individual farms.

It is important to mention that rather than simply having farmers rely on its support through its programming, government must also actively work to reduce our need for that programming. As farmers, we want and need to earn our livings as much as possible from the marketplace, and not from government programs or assistance. Government does not owe me a living. Government does, however, owe me a policy environment that gives me the opportunity--and only the opportunity--to succeed.

Therefore, the B.C. Grain Producers Association calls on the federal government to do the following: one, actively negotiate in the WTO, through bilaterals when necessary, to ensure Canadian grain and oilseed farmers and processors have access to markets that are not inhibited by subsidies, tariffs, and non-tariff trade barriers; two, move ahead on the smart regs initiative, not only to reduce the burden of regulation on our industry, but also to speed up the timelines in which Canadian farmers can access new and innovative products; three, provide the necessary incentives for research and investment in agriculture. Innovation has been critical in Canadian agriculture success, even in these very difficult times; innovation is also key to future success and competitiveness in the world market. Fourth, our government must show leadership in dealing with the perpetual transportation problems in western Canada. I need not say more.

In summary, we have presented you with our thoughts not only on business risk management, but also, to a lesser extent, on the science and innovation tools we feel are needed in the grains and oilseeds sector. We have also provided some concrete steps this government can take to minimize the need of farmers to rely on these tools and ultimately reduce the cost to Canadian taxpayers. Yes, we need the appropriate risk management tools, but we as farmers need to reduce and manage our risk as well.

I have just provided you, on the very back of your summary, with some of the fertilizer comparisons in Dawson Creek. You can look at that in your time. There have been significant cost increases.

I'd like to thank you. I look forward to your questions and your comments.

Thank you, Mr. Chairman.

[The Chair, Conservative, James Bezan]

Thank you, Mr. Ravelli.

Go ahead, Ms. Allison, please.

[Linda Allison, Southern Interior Stockmen's Association]

Thank you, Mr. Chairman.

Welcome to the committee members. I'm very pleased that you're visiting us here in the southern Okanagan Similkameen today.

I'm going to speak to you specifically about the environmental chapter. I'm here representing the Southern Interior Stockmen's Association. We're an association that represents about 150 ranching families in the southern interior of B.C. and approximately 30,000 head of cattle. You've already heard from my colleague Ernie Willis this morning. He was representing our provincial organization. I'm actually a fourth-generation rancher myself, a cow-calf producer in the Similkameen Valley.

Ranchers have long considered themselves stewards of the land and keepers of green space. With the increased urban sprawl, ranching operations and agriculture in general seem to come under closer scrutiny each day. Here in the southern interior, not only do we see increased legislation and regulation, but also we now have what we perceive to be a threat of a proposed national park. When I use the word “threat”, you can get the idea that we are not in favour of a proposed national park.

The environmental initiatives that have been undertaken already in British Columbia, through APF funding and actually through agriculture and environment partnership initiatives, have contributed greatly to helping ranchers in British Columbia meet some of those needs and improve some of their management practices. We have several programs here in B.C. The wild predator program I believe is actually unique to British Columbia. That's a program administered through these funds, which works with ranchers to alleviate predator problems for cattle.

The other thing we have been allowed to do through this funding is to develop unique relationships with ministries and NGO groups to develop pilot projects and work through ungulate problems of forage loss, forage depredation. We have several pilot projects on the go, from the wild ungulate compensation program in the East Kootenays, to wildlife damage program in the Peace River area, to an off-road vehicles strategy, to a program for noxious and invasive weeds. All of these relate directly to the environment and to our maintaining our green space and riparian areas.

We've been somewhat slow on the uptake of the environmental farm plans themselves. Nonetheless, they have taken off as far as the ranching community goes. We see increased need for that and increased continuation of the tools and funding that are available through those opportunities. As I said, we are the guardians and the keepers of huge amounts of green space here in British Columbia, and those tools enable us to improve upon that and provide that green space for viewing by urban dwellers.

We have seen huge increases in agriculture and wildlife conflicts here in British Columbia. We have conflicting regulations to deal with, both federal and provincial. We have “species at risk” legislation coming down the pike that we need to deal with on our ranches and for which we need to provide. Actually, the conflicts with wildlife in British Columbia have really gone beyond what is reasonably acceptable for a rancher to be able to deal with on his or her own. I'm sure you've heard stories of crop damage in the Peace, and stored forage damage, especially in northern B.C. this year, because of the increased snowfall. But that's not unique to the Peace River; it's happening all over British Columbia. So we see a need for continued government programs and funding, continued tools and enhanced tools that we can use to work and maintain that green space, to maintain the land base in a manner that will be economically viable in perpetuity.

I do have more information here on the environmental farm plans, just for your information.

Cow-calf producers in British Columbia have been able to access almost $400,000 of funding, which has gone towards best management practices on their individual ranches, and that's huge. That's just the funding we're talking about, federal funding. We're not talking about the partnered funding, such as Ducks Unlimited and that type of funding.

I think in order for us to continue to be good stewards of the land and to continue to provide that green space area that is so valued by the urban population, we certainly need to look to you to provide us with increased tools, increased funding, increased ideas for us to continue that level of stewardship and even enhance what is there.

I thank you very much for allowing me to speak to you today.

[The Chair, Conservative, James Bezan]

Thank you.

For B.C. Fruit Growers, Mr. Sardinha and Mr. Lucas.

[Joe Sardinha, BC Fruit Growers Association]

Thank you, Mr. Chairman, and good morning to all the committee members here. Welcome to Penticton. This is the heart of God's country, by the way.

My name is Joe Sardinha. I'm president of the B.C. Fruit Growers Association. I'm an apple grower in Summerland, just north of Penticton. The association appreciates the opportunity for input on the agricultural policy framework to you, this committee, here today. Our association, which has been in existence since 1889, today represents 1,015 commercial fruit growers in the Okanagan, Similkameen, and Creston valleys. This area encompasses 99% of the tree fruit production in this province.

Apples and cherries are the predominant crops in our industry. It's interesting to note that the acreage planted with cherries has substantially increased in the last ten years, largely due to the availability of premium cherry varieties through the breeding program at our Agriculture Canada research station in Summerland, the Pacific Agri-Food Research Centre. That is just a mere few minutes north of Penticton here.

The Okanagan tree fruit industry--and apples are the leading crop--continues to implement a strategy based on being a world leader in horticultural technology and new varieties. We recently completed a tree fruit industry strategy, and that strategy continued to stress that new varieties and replant are keys to our competitive strength and areas of opportunity. Other areas in our strategy focused on structure of industry organizations, marketing, quality, and labour.

With this brief background on our industry and its strategy, we are going to offer the following observations on the agricultural policy framework. We don't wish to repeat what was largely presented this morning by the B.C. Agriculture Council, because they represent the views of the association on many of the proposed pillars of the APF.

Our association, first of all, supports the Canadian Federation of Agriculture's recommendations on the next generation of agricultural policy. We also support, of course, those concepts presented by the B.C. Agriculture Council, as we are members of both. We also sincerely appreciate the consultative process that has been undertaken for the next generation of agricultural policy, and I do believe phase three is going to be under way shortly.

I'd like to concentrate on three areas of relevance to the tree fruit industry. Some of the items may have been discussed earlier this morning. First of all, on strategic investments, the agriculture policy framework needs to include a pillar for strategic investment, as per the CFA's proposal for a Canadian farm bill, and in particular, the proposal for a strategic growth pillar.

In the horticulture industry, we wish to increase self-reliance and get to a new way of operating. In the horticulture sector, we take great pride in delivering healthy, high-quality product that is produced in an environmentally sustainable manner and contributes to the health of Canadians. To do this, we need agriculture policy that looks ahead. We need agriculture policy that supports industry strategies, promotes innovation, and, more importantly, invests strategically.

I'll now provide an example of what we consider a prudent strategic investment. The tree fruit growers in B.C. have some encouraging news on this front. We are much better off today due to the development and commercialization of new varieties. The B.C. industry is a world leader in replant, and this has been encouraged by a provincial replant program in effect since 1991.

You will have this in your brief; we do have a chart provided for you that illustrates the following points. From the years 2000-02 the apple industry in the Okanagan generated an average of $56.7 million for growers at the farm gate level. If the industry had not replanted under the provincial program, then about one-third of the production would not be in the high-priced new varieties that are in the ground today. Had we retained the old varieties there would be an $11 million decline in industry revenues based on the lower returns that we would have garnered from the traditional varieties. If we assume that market-driven economics would have reduced apple acreage by one-third--in essence, an attrition of the industry--and we did not replant at all, then there would be an impact of $24.4 million on the overall farm gate revenue generation.

We have seen this level of impact in Ontario, where the industry has shrunk considerably, and in large part in Nova Scotia, until the recent announcement of a provincial replant program in that province. We feel that the success of the replant program as a strategic investment is very clear. On a comparison level, we see that the grains and oilseeds sector is benefiting from a national alternative fuel strategy with government-funded investments in ethanol and biodiesel production as a method of precedent-setting in terms of strategic investment.

We highly recommend that the federal government focus on strategic investment by offering a national program in tree fruit replant, as has been proposed by the Canadian Horticultural Council--and, may I add, by the last four federal agricultural ministers, so it's been a work in progress.

Three of the four main apple-producing provinces now have replant programs, but the federal partnership is missing. We need more consistency in the agriculture policy framework, and the best way of providing this is a national strategic investment program such as replant. The net effect of a national replant program would, of course, position the industry to remain competitive and sustainable for the long term.

My second item is on trade, and it too was brought up this morning. In terms of trade, I have a little pet name here--“alien invasive species”. That's what we're calling imports these days in the apple industry.

Fair trade is an issue for fresh produce. Fresh produce occasionally gets into an oversupply situation, particularly in the North American market. In fact, price collapses occur in the North American market due to factors such as retail consolidation and U.S. expansion of subsidies that promote unrepentant overproduction.

These market failures have a very negative impact on an industry. Our industry here in the Okanagan suffered a 50% revenue decline for the 2004 crop. Who can take that on an ongoing basis?

Such a collapse causes the level of investment and confidence in business planning to suffer. We know that consumers suffer because they may no longer be able to source local products. We know that taxpayers suffer as they pay for financial programs and transition payments to assist industry with those huge shortfalls. And we also know that retailers are huge beneficiaries. They pay half the amount for purchasing the produce and do not pass the savings on to the consumer.

So apart from imploring governments to provide special assistance during these situations, grower associations can pursue trade actions against dumped products. For the fresh produce, we would like to see an alternative to the current anti-dumping process: trade action. I'll just outline a few brief things on the drawbacks of the current system.

The process is not timely. The time to gather extensive data, prove anti-dumping, and finally prove injury is a huge constraint.

The process is expensive to administer. At a minimum, it's $275,000, and about the same amount of in-kind funding by the producer associations, to launch an anti-dumping case. The dollar amounts can rise. And keep in mind that this is when the commodity associations are dealing with a financial disaster, to boot.

The process is highly uncertain and the results often seem very random, or at the whim of the administrator. In this case, the CITT, or the Canadian International Trade Tribunal, has the final decision-making authority.

And I'd add one more, which is not in your brief. The process is entirely reactive.

This is the current process that we must deal with under SIMA, the Special Import Measures Act. We feel that a new method of dealing with market collapses and failures due to product dumping needs to be investigated. For that, we are working in conjunction with the Canadian Federation of Agriculture. They're examining our proposal that a minimum import price be established that is a certain percentage of the prior five years--in other words, a reference period. And we're arbitrarily saying 95% of the value of that reference period. That's when U.S. or world prices for produce fall. Imports to Canada will enter only at a minimum 95% of this prior price level.

We know there are probably rules in international trade and that this type of proposal or approach does not entirely match those rules. However, we feel that the impact will not be negative on exporters to Canada. They will be exporting to a higher-priced market and they will also have unfettered access, as they currently do under NAFTA and other trade agreements.

We hope to have more on this in the future as we develop a strategy and a business plan with the Canadian Federation of Agriculture.

I have used this as a case for apples. I would like to state that this is becoming an issue also for the cherry industry here in the Okanagan. We see incidents of the same dumping occurring.

Lastly, I would like to talk about domestic marketing, and essentially, the Canada brand. The current agricultural policy framework does not have a marketing pillar, but I see that one is proposed.

National programs of course do exist for developing export markets. I think we can all recognize that a strong domestic market will lead to success in international markets. So the current approach is missing one step: we've built up brand Canada for international markets, yet we don't look at our own domestic market internally.

I believe this point was also brought up this morning. We feel that it is imperative that federal policy change to provide for the developing of Canadian markets. Purchase of local products will lead to increased food safety, improved environmental sustainability for foods, and greater success internationally as well. The agriculture industry desperately needs domestic marketing, including the mix of agriculture policy framework programs. This is where I feel two steps could be taken to initiate this process. Both institutional sourcing of Canadian products and the domestic use of the Canada brand initiative are definitely positive starting points, and we have to focus there.

In conclusion, in addition to the CFA recommendations for the agriculture policy framework, and of course the input of the B.C. Agriculture Council, we would like to see a focus on strategic investments and minimum import price mechanism based on prior price levels as a proactive measure to eliminate dumping and maintain fair trade. Fairness has to come into trade. And finally, we would like to see a new focus on marketing Canadian products domestically.

We didn't have time to add one more thing, but just as a side note we wanted to include it. We ask that the minor use program, which is so vital to horticulture, continue to be funded, because there is some really positive work coming from that program. We are getting more registrations from the PMRA as a result.

Thank you very much.

[The Chair, Conservative, James Bezan]

Thank you, Mr. Sardinha.

There was some talk during the quick break about a five-minute round instead of seven-minute rounds. I'm open to suggestions from the committee on how you want to proceed. Do you want to stick with seven minutes on the first round, or go to five?

[Wayne Easter, Liberal, Malpeque, PE]

Five. It gives everybody a chance.

[The Chair, Conservative, James Bezan]

Do we have a consensus? You guys are okay?

[A voice]

Sure.

[The Chair, Conservative, James Bezan]

With that, Mr. Hubbard, five minutes, please.

[Charles Hubbard, Liberal, Miramichi, NB]

Thank you, Mr. Chair.

Thank you for the welcome you have offered us here. It's my first time in Penticton. I've been in areas around here before, but to come to this from New Brunswick, with two feet of snow yesterday, it's certainly a welcome climate.

As a committee, as we go across the country and hear from all of the different sectors, everybody has a solution, but there are too many problems from the adjoining seats at the table. It's very difficult to come up with a policy that's going to suit everyone.

Maybe I'll start with Ross. It wasn't too long ago, I think, that we had a farmer from your area drive to Ottawa with a combine.

[Ross Ravelli]

Yes, he's still up there.

[Charles Hubbard, Liberal, Miramichi, NB]

He must have done a very good job, because today you're much more optimistic. You seem to think, at least on the grains and oil seeds, that things have improved. So if you send a second guy there, maybe this summer, with a new government, it could be a wonderful world you're into.

Looking at your concept here of insurance, you know that governments pay most of that insurance business. Producers have a certain.... You want an increase in it. If we went to other insurance programs that the government is involved with, should it be only producers--maybe with governments playing a minor role in insurance--who are involved? Somehow across the country, with crop insurance, production insurance, it could be regulated, administered, and looked after by farmers and agricultural groups instead of our provincial and federal governments being so much involved. Would that work, from your perspective?

[Ross Ravelli]

I'm just trying to think of what kind of insurance, what kind of private industry, or even a producer group, would have the backstop for that kind of risk, because it's all about managing your risk. I mean, whoever did it would still have to go out and re-insure on the international market for that risk.

The point I would like to make is that if insurance covered my effective production and risk, I may be willing to pay more as a premium, even within the program we have today; but it has to be relevant to what we're doing today and the risk.

[Charles Hubbard, Liberal, Miramichi, NB]

So your recommendation is that government must play a major role in any risk that farmers across this country are taking, paying probably 60% or 70% of the losses each year.

[Ross Ravelli]

I just don't have a vision of what the other option could be. I guess if I saw something presented, I'd be willing to look at it. On the national program, because it is a national issue for a lot of crops, how can we step back from that?

[Charles Hubbard, Liberal, Miramichi, NB]

Secondly, the last report that we wrote spoke very strongly about a disaster program. It seems we hear a lot of that everywhere in terms of something major happening, whether it be BSE or whatever. We do have problems with drought. It's very difficult, for example, to define where the disaster is, if it's after one or two years or how far you have to get. Flooding is something that the previous group brought before us. But in terms of disaster, I guess most people around the table would agree that we should have a major program dealing with disasters.

Ms. Allison, would you concur in terms of the cattle industry?

[Linda Allison]

I would certainly concur that disaster insurance would be the primary insurance we would be concerned about. As you mentioned, drought is very difficult, and we've gone through BSE. Even though there have been announcements of money paid out on CAIS to folks, etc., I personally don't know anyone who has received anything. So if it were on a disaster type of basis, I think it would respond in a more timely manner.

[Charles Hubbard, Liberal, Miramichi, NB]

We've also heard about research. Major changes were made in the research operations across our country about seven, eight, or maybe ten years ago. Has it worked effectively in your industry? Are big players taking all the research money? Getting down to the sector level, are we putting adequate attention to research?

Joe, you talked about that in terms of your apple industry. It's very important to have a vision and look at research to do that, but do we put enough effort nationally, as a government, into research and helping your sector and other sectors?

[Joe Sardinha]

In terms of research, the Canadian apple industry just had a national priority-setting research workshop with players from Ontario, Quebec, New Brunswick, Nova Scotia, and B.C. The very thing I talked about, in terms of the breeding program, was one of the top five research priorities that came out of that.

We are struggling with that very thing. We are struggling with Agriculture Canada maintaining a focus on primary production and research issues, things such as integrated pest management, working on diseases, insects, those types of things, the primary production research, because a lot of the focuses now are going to things like nutraceuticals, food safety, and biotechnology. Quite frankly, biotechnology in our industry scares the heck out of us. We don't want to be planting a bioengineered tree in our orchards just yet, because of the backlashes that could occur.

So some of these AFC focuses are positive. They're going to create new opportunities, such as value-added product development and what not. At the same time, we need to reserve a huge chunk of resources and attract new scientists on a continual basis who will come and do the work for primary production and research. That is really key.

[Charles Hubbard, Liberal, Miramichi, NB]

Do I have a bit more time?

[The Chair, Conservative, James Bezan]

Just a short question.

[Charles Hubbard, Liberal, Miramichi, NB]

The other point that Ross and others have mentioned this morning is infrastructure. When we talk about subsidies and all of that, we get involved with world trade and everybody else who's critical of governments putting money into programs. But with infrastructure, whether it be your transportation sectors or whatever it might be, it would be good to present to governments what we can do outside the farm in order to improve the revenues that farms might have.

Finally, as a brief allusion here to the concept of the retail industry, it's becoming very, very small in this country. Many farmers, of course, are having great difficulties dealing with that on an annual basis. You can supply a product for three or four months. But I would hope that you would look at what's happening in Europe, Britain in particular, and see what some of their attitudes are in terms of how they're dealing with retailers and what retailers may do for your industry.

I guess I've used my five minutes. Thank you, Mr. Chair.

[The Chair, Conservative, James Bezan]

Thank you, Mr. Hubbard.

Does anybody want to get in a brief reply?

Mr. Gaudet, you have five minutes.

[Roger Gaudet, Bloc, Montcalm, QC]

Good morning, everyone.

I'll get right to the crux of the matter. Mr. Ravelli seems happy, this morning. He said that he no longer needs government subsidies. I want him to explain to me how he intends to compete with the United States and the European Union, which both subsidize their agricultural sector. I'm astounded to hear that everything is just fine and that the federal government no longer needs to hand over any money.

As a grain producer, how do you think you'll compete with the United States and the European Union without any subsidies whatsoever? Will you work for nothing? I want you to explain that to me. I might have misunderstood your presentation.