Agriculture Committee on April 18th, 2007

[Wayne Goerzen]

That is something we're working towards, and I think the other thing we have to work towards is the environmental value of our crops, particularly perennial forage crops like alfalfa. These crops are fixing nitrogen at an enormous rate and can be used in cropping rotation, reducing, then, dependence on nitrogen produced through natural gas. I don't have to tell you how expensive that's becoming.

So we see a role for alfalfa on the whole green side of things, not only in ethanol production, but also in land stewardship, in building up the quality of the land. And that benefit then extends to other crops in rotation.

[The Chair, Conservative, James Bezan]

Mr. Treleaven wanted in on this as well.

[John Treleaven]

This is just a thought. When you're next in Ottawa, go to a very big laboratory called Iogen. Iogen in Ottawa is working on ethanol from waste products. It's in production.

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

Thank you.

[The Chair, Conservative, James Bezan]

I want to thank all of you for your input today in helping us out with our study on APF.

We are going to suspend for about fifteen minutes to allow witnesses to clear away and so our next group of witnesses can come to the table.

There is coffee and juice for members. With that, we'll suspend until 10:30.

[The Chair, Conservative, James Bezan]

I call this meeting back to order.

We'll continue with our APF study.

We welcome to the table now, from the Canadian Bison Association, Terry Kremeniuk and Mark Silzer; from the Canadian Canola Growers Association, Wayne Bacon, who is the president; and from Saskatchewan Pork Development Board we have Neil Ketilson, who is the general manager, and Shirley Volden, who is the vice-chair.

Welcome, all of you.

We'll start off with opening comments of ten minutes or less per organization.

Who is going to kick us off from the Canadian Bison Association? You will, Mark? Okay.

[Mark Silzer, President, Canadian Bison Association]

Thank you, Mr. Chairman.

It's certainly a pleasure to be able to attend this session. For a small industry with not a lot of financial resources, the ability to make this presentation in our own backyard is very welcome.

Just as a little bit of background on the bison industry, although bison are certainly not new to North America, the commercial industry is less than 20 years old. The first census, in 1996, estimated there were around 45,000 head on approximately 750 farms in Canada. Right now, our estimates peg us at around 275,000 bison on fewer than 1,900 farms. That represents a 20% growth rate over the past 10 years. We have provided additional information for you on that.

Of the bison in Canada, 90% are raised in the four western provinces. To represent the interests of the bison industry in Canada, the Canadian Bison Association was established in 1983. We currently have six active regional associations, representing Quebec, Ontario, Manitoba, Saskatchewan, Alberta, and British Columbia, with around 800 members, and we feel we represent about 80% of the actual herd numbers in Canada.

When it comes to business risk management, we feel risk management is important to the bison industry. Being a start-up animal industry sector, it has an income volatility that tends to be more dramatic than that in more mature agriculture sectors. The issues faced by the industry are not unlike those faced by a start-up business, where the supporting infrastructure and risk management tools must be adequate to attract capital if the industry is to grow.

Risk management tools should provide a measure of assistance when cash flow disruptions occur outside normal market cycles.

Programs must facilitate commerce. They should assist producers in achieving their business goals, while allowing them to respond to market signals.

Producers should have access to a suite of private- and public-sector risk management programs to manage their businesses. Knowing the program impacts on individual businesses and the consequences of participating or not participating, producers can more effectively plan their business strategies.

This also means timely program payments. Programs should be structured so that they support producer cashflows in a manner that closely matches business cash flow needs. Having a mechanism that offers program advances that, on final filing, are clawed back reflects a fundamental flaw in the program design and should be prevented. I think you've heard that already this morning.

Administrative simplicity is important to ensure maximum program participation as well as program cost effectiveness. The regulatory infrastructure contributes to managing risk and creating opportunities. An example often cited is the need for regulations that facilitate interprovincial trade in meat from provincially inspected plants. This is important for developing industries such as ours, where producers are creatively developing products and niche markets for bison that require interprovincial movement of their products.

While it is important to have an effective regulatory framework, care must be taken to ensure that regulations do not create excessive costs that make Canadian industries and products less competitive in the world marketplace. If such regulations are required, it may be necessary to provide assistance to protect the industry and infrastructure until such time as the industry has been able to make the required adjustments, in order for it to be competitive.

Timeliness of regulatory changes is also very important. In some circumstances, regulations were established many years ago, when the bison industry was not considered in the process.

Certain regulatory changes are straightforward and are supported by all stakeholders, and such changes should be fast-tracked, rather than take two years to complete. If fast-tracked, very likely the regulatory change would allow producers to obtain greater returns from the marketplace.

We feel that programs must also be flexible to address commodity needs. In the bison industry in 2006, an estimated 40,000 animals were marketed. Of these, approximately one-third were shipped to the U.S. for slaughter, with the remaining being slaughtered in Canada, and the meat is marketed both domestically and internationally.

Since this is a small industry, the marketing and price discovery systems do not have the breadth and depth of sectors that have developed over the past 100 years, where millions of animals are marketed annually. Programs tend to be developed for major commodity sectors.

The major commodities have a history of data and information and are able to develop program scenarios under different industry conditions. A new industry such as bison does not have the comfort of such information infrastructure. Resources to invest in data collection and analysis are limited, and consequently, it appears to be easier to include smaller commodities within programs for larger commodities.

Although this strategy may work in some circumstances, in others it does not. A more effective strategy may be to provide small developing industry sectors with core funding so that they can develop the infrastructure to collect data and contribute to policy development and process.

We believe that programs must diversify markets and re-establish markets lost. The bison is indigenous to North America, making it a unique product for international markets, and based on its nutritional profile and growing consumer awareness of the product and consumer demands, we think it has a tremendous fit for international markets. But the loss of international markets creates significant risks for the bison industry, and trade interruptions not only have an impact on the international marketplace but also on the domestic marketplace. We certainly saw that during BSE.

As a result, the “other ruminant” market development program was established where $550,000 was given to the bison industry to deal with the consequences of BSE. We believe that program was very beneficial in helping some of our local farm-direct marketers as well as increasing some of the domestic markets within Canada and helping us to try to recapture our share of the U.S. market that was lost. Working with industry, this program, which is near completion, has shown beneficial results and should be considered as a long-term program to support growth in domestic market development until such time that the industry can bear such costs on its own.

The bison industry is also participating in the Canadian agriculture and food international program, and we feel that this is a very beneficial program in helping us to establish international markets.

For developing industries, trade regulations are continually evolving, and in some circumstances access is not as well developed for bison as it is for mature agriculture sectors. In these circumstances, government support is critical to obtain market access where barriers exist. Improved market access contributes to business risk management.

Government support through the Canadian food safety and quality program has assisted the industry in responding to trends by continuing with the development of an on-farm food safety program and developing a traceability strategy and policies that are beneficial to society. However, in such programs there are significant in-kind contributions by producers that go unrecognized and an inability to recapture these contributions in the marketplace. Partnerships with government on such programs are important. Recognizing the public good created through in-kind contributions by producers, producers should not be asked to share program costs beyond their significant in-kind contribution.

The disaster assistance program option—I think disasters normally do not fit into program structures. Because events such as natural disasters, disease, and government-imposed trade restrictions are unpredictable, it is important to have a program flexibility to respond and ensure that producers can return to business as soon as possible. Such a program should have an established framework that defines funding parameters, response times, and other details to the extent that this is possible. Because these are unusual events, they should be funded by government resources incremental to those committed to business risk management programs.

With that, I would like to thank you once again, Mr. Chairman, for allowing us to make that presentation.

[The Chair, Conservative, James Bezan]

Thank you.

Mr. Bacon.

[Wayne Bacon, President, Canadian Canola Growers Association]

Thanks, Mr. Chairman. Good morning, and good morning to the members.

It is a privilege to be here today to discuss business risk management. That is an important topic to the canola growers—not only to the growers in the province, but across Canada as well.

I am here to represent the Saskatchewan canola growers; I farm at Kinistino. But I would like to also point out that our organization is represented at a national level by the Canadian Canola Growers Association. Our position on the BRM provincially is consistent with the position nationally.

At the national level, the Canadian Canola Growers Association represents approximately 60,000 growers, or about 95% of the growers across Canada. The Canadian Canola Growers Association is governed by a board of directors of elected representatives from our provincial grower organizations. Our mission is to influence national issues and policies and enhance the profitability of canola growers.

The Canadian Canola Growers Association member organizations include the Ontario Canola Growers, Manitoba Canola Growers, the Saskatchewan Canola Growers Association, the Saskatchewan Canola Development Commission, the Alberta Canola Producers Commission, and the B.C. Grain Producers.

Canola is a big business in Canada. Our 60,000 farmers who grow canola on their farms produce about six to seven million tonnes of canola production, and it continues to rise.

For example, in 2005, Canadian farmers produced 9.6 million tonnes of canola. The farm gate value of that canola, depending on price, was about $2 billion to $2.5 billion. This can represent anywhere from one-third to one-half of an individual farm's gross receipts in any given year.

The canola industry as a whole generates about $11 billion in economic activity annually. This is just one of the crops and one part of the agriculture industry. When you consider all farmers across all commodities, the latest statistics for 2005 show total farm cash receipts in Canada were just over $37 billion. Operating expenses and depreciation amounted to $35 billion that same year. Today's farming is big business, and it involves significant investments. It involves significant sink funds and variable costs. The bottom line is that financial risks are very high. This is why getting effective policies on BRM is critically important to our farmers.

The major sources of risk in my business as a canola grower are crop production risks, price risk, and the price-distorting and production-distorting practices of foreign government policies.

On the topic of production risks, I would like to point out that as the first line of defence, growers actually manage their production risks with good, sound economic practices. We rotate our crops, we fertilize, we rotate the chemicals, scout our fields for insects and disease, and do everything we can do to ensure that the maximum potential for yield and quality is there. However, we are still susceptible to weather, frost, drought, excess moisture. They can all take a toll on our production, and we've seen that a number of times in Saskatchewan over the last five years. This is where our production insurance plays a very important role, and it needs to continue to play an important role.

Production insurance has served us well in the past. However, to ensure that it continues to effectively meet the needs of farmers going forward, it needs to keep current on price and on production levels. There is a disturbing trend in production insurance. Premiums continue to rise and coverage levels continue to fall. This needs to be addressed to ensure that our insurance program remains a viable risk management tool for farmers.

One part of the solution that could be examined is that adjustment be made to the base program to account for the significant impact new seed technology is having on yield. This is very prevalent in canola. With the new hybrid varieties delivering substantially higher yield potentials, the current ten-year average for determining suitable yields does not respond quickly enough to the new realities. Therefore, yield coverage levels through production insurance will continue to lag, unless something is done.

We need some innovative factors built into the base production insurance model so that it responds to and offsets the risks of today, not of days gone by.

The same issues arise on the price side. Specialty oil canola is an example, where farmers grow higher-value speciality oil crops but are not able to insure these crops at high enough values to fully offset the risks and potential loss of opportunities.

A concept we are working on as canola growers is that of revenue insurance. This concept will build on the existing production insurance program and would create a combined price and production insurance model that would essentially offset farmers at market base for any insurance products. We have studied the performance of this concept, and our research to date has shown that it would be an effective risk management tool for farmers.

We believe the national market-based insurance program should be used as a foundation for the federal BRM strategy. We should be looking more closely at price insurance, revenue insurance, maybe even weather insurance. Insurance models, if designed appropriately, will reflect true market signals. They allow farmers the flexibility to select premiums and coverage level options that fit their individual farming businesses.

The downside risks in bottom-line coverage are known and are bankable, the payouts are quick, and payouts are in the year of need. These features of insurance are major shortcomings of our current CAIS program, as I am sure you have heard on numerous occasions.

Also related to management risks on the price side is the cash advance program. This has been a very effective program, and I would like to thank the Government of Canada for the recent expansion of the dollar limits of this program and see it extended to other commodities as well.

We use this program to cash-flow our business while we market our grains. Without it, we would be driven to market grains for cash flow purposes, rather than focus on maximizing returns from the marketplace. This program is a very useful program for us. Part of the success of the program is that it is effectively administered and delivered by grower groups. I would encourage governments to consider other programs that grower groups could administer on their behalf.

Another point I would like to make is that we really appreciate the government's recent announcement on renewable fuels, and biodiesel in particular. Thank you for that. It is always important to diversify your customer base as a way of lowering business risk. Once the biodiesel industry is up and running, canola growers will have a new domestic market to serve.

Now I'd like to touch briefly on the third area of business risk that I mentioned earlier, the trade-distorting policies of foreign countries. That is a risk I cannot manage on my own, and I feel it negatively impacts upon my farm.

There have been studies conducted showing that the international marketplace is distorted by subsidies and tariffs, and these are costing growers real dollars every single day. Estimates are that the trade-distorting subsidies cost Canada's grain and oilseeds sectors $1.3 billion, and tariffs and quotas are costing us another $1.2 billion, every single year. When you look at canola specifically, these distortions are costing us $800 million each year. We need you to fix this for us; we cannot do it.

We need real and meaningful trade liberalization, and also the three pillars of the WTO negotiations: domestic support, export competition, and market access. Bilateral trade agreements have their place, but they do not address the trade distortions and domestic subsidies issues.

We need Canada to be active on all fronts, WTO and bilateral, to aggressively pursue trade liberalization for us as exporters.

The current WTO rules are not acceptable. Countries such as the U.S. and the EU still have substantial room within their existing WTO agreements to increase trade-distortion programs and policies at ongoing risk to the viability and competition of Canadian growers until such time as a new and improved agreement is reached.

In closing, I would like to point out a very important linkage between federal programs for risk management and international trade. Any program that is developed must be designed to minimize the risk of countervail actions by other countries. To do that, the federal programs must be national scope, they must be generally available and generally used by all, and they should not advantage one region or one commodity over another. This is a fundamental principle that the Government of Canada has followed in the past, and we fully support the principle now and going forward into the future.

The concept of regional flexibility in a federally funded program quickly takes you down a path of countervail programs. As a major exported commodity, canola could easily be targeted for retaliation measures such as trade disputes arising from these actions. We do not want to get into a situation where we pay the price for countervail action against a government's program.

We are here to discuss business risk management and we ask that the government be diligent in program design so that we do not get caught up in creating new business risks that we do not need. Ongoing consultation with producer organizations is a key to ensuring programs are designed properly.

With that, thank you for the opportunity to present our views on the BRM. I look forward to your questions and will now turn it back to the chair.

[The Chair, Conservative, James Bezan]

Thank you, Mr. Bacon.

Mr. Ketilson, ten minutes or less.

[Neil Ketilson, General Manager, Saskatchewan Pork Development Board]

Thank you very much, Mr. Chair and committee members. Welcome to Saskatchewan.

It's our privilege to appear before you today to outline some of the issues that are specifically relevant to the hog producers in this province. Indeed these issues have implications to those right across the country.

I want to begin by giving you a bit of an idea of what the industry looks like. We produce about 2.4 million hogs in the province. That's up double from the last ten years. As a result of the Crow rate change in the mid-1990s, livestock production, specifically hog production, has increased significantly in this province.

At the same time that our livestock numbers are going up, the number of producers involved in that business is going down, and going down quite significantly: we had about 18,000 farmers producing hogs in the mid-1980s and we have fewer than 400 today. That is quite significant. The farms of today are quite appreciably different from what they were before.

Even though the industry is very cyclical, both on an annual basis as well as over a four-year period of time, we're presently under a squeeze in terms of high feed-grain prices.

We believe there's tremendous opportunity in this province to expand the hog industry. We are blessed with about 40 million acres of cultivated land. We think hog production adds to the grain farming business. It's very sustainable in terms of the application of manure with the grain farms; you get a continuous loop and add value, and it's good for those who want to be involved in that business.

I want to touch on four or five key issues and speak to them. Hopefully they'll provoke a question or two.

The first one is with respect to packer consolidation and the lack of competitive pricing for hogs. As most of you will understand, in Canada we have two major packing organizations: Olymel out of Quebec, and Maple Leaf Foods out of Toronto and across Canada.

Maple Leaf Foods recently announced that they were closing the Saskatoon plant, the only significant federally inspected slaughter plant in this province, on May 31. While we respect the right of that company to reorganize and rejig their business so that they are more profitable, it really impacts the producers in the province in a negative way.

For your information, during their restructuring Maple Leaf Foods is planning to close plants right across Canada. They sold the one in the Maritimes; they're selling the one in Ontario, selling the one in Saskatoon, and divesting of the one in Lethbridge. They're reducing their slaughter capacity from about 7.4 million a year to about 4.5 million. When you think about that in terms of the implications to this country and our business, it's huge.

It's especially huge to the people in this province. We have about one million hogs within 200 kilometres of Saskatoon. That is roughly the size of the plant that's here. It will force those producers to ship to the Brandon plant that Maple Leaf Foods owns and/or to the Olymel plant in Red Deer. You can appreciate that it will be very expensive: it's a marginal increase of about $4 to $6 a head, as well as the inconvenience that goes along with it. Not everybody has an exact 205 hogs per week that they can load in a semi, so we're back to the old system of assembly yards and all kinds of stuff as a result of this action.

We believe Maple Leaf has an oligopolistic power or a near monopoly power, depending on where you are in this country, given the transportation costs and things like that. Many would suggest and argue that we're the Wal-Mart of North America in terms of hog prices—the lowest there is—and as a result we are seeing a shift in production from market-weight hogs to weanling hogs that are shipped down into the United States to be fed. We're really exporting the value-added part of this business, and we think that's very much a negative thing.

Second, the mood of producers in this province has shifted significantly, given the closure of this plant. Guys are very frustrated. They're really not sure where they're going to go with this thing, and many have made the decision that they're going to exit the business, so we would see a further reduction in numbers as well as in the number of producers who are out there.

Consequently, we believe we need a packing plant in this province. If you consider the hog business and compare it to the grain business, it would be equivalent to shutting down all the elevators and having to transport grain to the neighbouring provinces. We find this to be unpleasant and we'd like to do something about it.

Saskatchewan people are very innovative and creative, as you know, and tend to take things into their own hands, so we have put a partnership together that we believe is unique. We've partnered with a first nation community—with a large-scale hog producer, Big Sky Farms—and we have signed up enough investment dollars from producers to build a million-head plant. We are presently going through a feasibility study to determine the viability of that option and trying to find a marketing partner who will partner with us. My point to all this is to suggest that it would be very useful if the federal government had a program to assist producers in gaining a greater share of the value-added markets. That would be very useful.

Next come profitability and competitiveness—if I'm getting too long-winded, speed me up. Farm support is very near and dear to an awful lot of our producers, and it's a very useful program. The CAIS program has worked for many of those people, although payments in a more timely fashion would be extremely useful.

Animal health and the threat of foreign animal disease has huge implications to our industry. We have three days, after which, in the case of a foreign animal disease, we would have to start killing animals out of the barns, so that is very significant. We need a policy, a federal government policy, that is very clearly articulated and put in place prior to a disaster like this so that people know where they are. It has to compensate not only those people who are directly affected by the disease, but also those who are indirectly affected. That's very important, and I'm sure you understand that.

A lot of people are very keen on ethanol production and biofuels. The agricultural industry is very supportive. The hog industry views it a little bit differently, in that it might increase the price of feed grains, and if you look at $4 corn in the U.S., that's exactly what it's done.

We would argue that we have to have a win-win situation in this. Therefore, if we are going to support ethanol, we also need to make sure we have the varieties of grain that are going to increase the amount of feed grains across this country so that we can remain competitive as well.

Next is a very important point, and I don't think we can underscore it enough: we need a very level playing field on the regulatory side, and we need that regulatory piece right across the globe. About 80% of our product out of this province goes international. Our trade is very important to us. Let me give you three examples that come to mind.

Paylean is a product used in the barns that increases efficiency and gains us about $4 to $6 a head. The United States had the product licensed and in use in their market for six years prior to us; we just received accreditation and licensing last year. We find that totally unacceptable. We need a system that moves ahead and gets things done.

The second thing is circovirus. I think you've all heard about the devastating impact that's had on the hog industry right across eastern Canada, and it's becoming more prevalent in the west now. The vaccine for that is made by a company in France. There is a little side note to this: the withdrawal time on registration within Canada, if you vaccinate sows, is 60 days prior to their being able to be slaughtered; in France, it's zero. Why the difference? How can we remain competitive if you get those kinds of inconsistencies?

One of the other things was noted by Dr. Harold Fast, who was just in China, who exports breeding stock over there and just came back. He is partnering with a fellow, a business associate, who built a million-head slaughter plant in China in less than a year for less cost than the consortium in all the west paid in Winnipeg just for the regulatory issues, for a plant that failed in Winnipeg. They built the plant—complete, the whole deal—and didn't spend as much money as we did in Winnipeg just to try to get through the regulatory issues. How do we compete with that?

On the trade issue, the WTO needs to work for us. We need liberalization on trade.

Thank you very much.

[The Chair, Conservative, James Bezan]

Thank you.

With that, we'll turn it over to you, Mr. Hubbard. We'll kick it off with the first round.

[Charles Hubbard, Liberal, Miramichi, NB]

Thanks, Mr. Chair.

Maybe we'll start it off with hogs, then.

You present the figures here on the number of hogs being produced each year in Maple Leaf Foods. How are you going to address this in the immediate future? Where are those hogs going to go if Maple Leaf closes their plant—for example, the one here. Has that been looked after, or is it going to be a crisis for a lot of farmers keeping hogs that'll be overweight and won't meet the real market requirements?

[Neil Ketilson]

I'll need more than ten minutes to answer that. No, I'm kidding.

Actually, it's a very significant issue for us. Maple Leaf Foods in Brandon are killing about 45,000 a week right now. They want to double-shift that plant up to 90,000. We're killing about 15,000 to 18,000 in Saskatoon right now. They would like us to take all those hogs to Brandon to be killed there.

Incidentally, I told you that we had producers who were very supportive of doing our own thing here. Maple Leaf came out with a five-year exclusive contract to go to Brandon, and that's the only option they'll go with.

So where are the hogs going? They're going to Brandon, or they're going to the United States, with about a $20 ticket on the back of every one for transportation.

[Charles Hubbard, Liberal, Miramichi, NB]

So with the margins that there are in hogs—you talk about a six-dollar or better transportation increase in cost—does this completely destroy your margin, or do you have another little bit of money to play around with in terms of making a profit?

[Neil Ketilson]

The cost of production is about $135 usually, depending on feed grain prices and those kinds of things. Guys are at near break-even right now. It's very difficult to add another four to six bucks on to it and make it work. Typically, on an annual basis, if the guys are making six to ten bucks a hog they're happy.

It certainly takes the edge off the business, and consequently a lot of people are exiting.

[Charles Hubbard, Liberal, Miramichi, NB]

This virus you speak of is a significant problem in some provinces. You haven't encountered much of it here, but you're saying to our committee that there is a major concern that maybe there is medicine that would be available that would assist and that there's a problem getting it, in terms of what you speak of.

[Neil Ketilson]

That's right. There is a vaccine for circovirus now that just came out recently, and it's in very short supply. Consequently, everybody who wants it can't get it.

My point was that the regulatory licensing and withdrawal time of that product in Canada is quite different from that in the country where it originated. If you're going to vaccinate a sow, for example, and cull that animal at some point in time—or you may—you have to hold it for 60 days prior to being able to sell it for slaughter. That creates a very inconvenient situation. I guess the big question is, if there is a zero tolerance in terms of timing for slaughter in France, why are we different?

[Charles Hubbard, Liberal, Miramichi, NB]

With the canola, you give great thanks for the increase in your cash advance, which is going to help you out. You also look very optimistically at biodiesel in terms of increasing the price.

How much do you rely on government as canola growers? Do you need a lot of programs, or do you think, in terms of your future, that there are programs that maybe canola won't need anymore? You seem very optimistic.

[Wayne Bacon]

We are very optimistic in the canola industry. I think we need the programs there to get biodiesel up and running. I think that's very important. If we don't have the programs there from the federal government, all these companies are going to be setting up their businesses across the border, where they are basically getting $1 a litre from the government to produce it. That's one of the areas in which the government really has to assist the industry in getting up and running. I think that as we move down the road, we—

[Charles Hubbard, Liberal, Miramichi, NB]

Now, the American practice in terms of ethanol and so on is that governments certainly are involved, but farmers are involved big time.

[Wayne Bacon]

That's right.

[Charles Hubbard, Liberal, Miramichi, NB]

Is there evidence that your group is becoming involved big time with this, or are you going to sit back and wait for somebody else, somebody from New York or Chicago representing the oil or other sectors, to come and start playing around with your future? Are you and your grower group out there actively involved and wanting to participate in investing in the industry to get some of the other profits from it? Is there some of that?

[Wayne Bacon]

I know that I certainly, and a number of producers around the province, want to invest in biodiesel. We want to get biodiesel up and running. The problem is, again, that if we don't have the policy there from the feds to invest in something and to make sure producers are going to invest in something they're either going to have a return on, or at least a break-even, then they're not going to—

[Charles Hubbard, Liberal, Miramichi, NB]

In Saskatchewan, your cooperatives—