Good morning, Mr. Chair, members of the House of Commons Standing Committee on Agriculture and Agri-Food, and fellow guests. Thank you for providing us with the opportunity to speak about issues that are important to corn producers in Manitoba.
My name is Bob Bartley, and I'm a director of the Manitoba Corn Growers Association. The Manitoba Corn Growers represents over 900 corn producers in the province. I grow grain and oilseeds on 1,300 acres in Roland, Manitoba, located 60 miles southwest of Winnipeg in the Red River Valley. Roland is the home of Canadian 4-H and the Giant Pumpkin. Grain corn has been one of our main crops ever since we started producing it in 1964.
Some of the issues I would like to cover on behalf of our members are safety net issues, trade, environmental programs, cash advance programs, pesticide harmonization, and the rail strike.
The need for a predictable and bankable safety net program has been an outstanding issue for quite a number of years now. With the review of the current business risk management programs as part of the review of the agricultural policy framework, it has become clear that even with some of the adjustments that have been made, there is still room for improvement.
I would like to encourage the government to maintain a strong production insurance program and to continue to look for areas within production insurance to enhance so that corn producers will have a predictable core program to rely on. One of the areas we feel could be improved is to provide a more transparent methodology for arriving at the prices used by production insurance, and to involve commodity groups in the development process well in advance of the announcement of those prices.
The current CAIS program is not predictable enough for financial institutions to include in a producer's basic equity statement. This problem has been mentioned from the beginning of the CAIS program, and it does not seem that any of the changes made to date have strengthened this reliability. Governments need to work with farm groups and financial institutions to make adjustments that work for everyone. These changes need to result in a program that is predictable, that is simple to apply for, and that reduces the amount of time that producers spend filling out paperwork.
When CAIS does provide support for farmers, it often arrives a year or two after the loss. There need to be modifications to the income tax system so that proceeds of the claim become taxable in the year of loss rather than when they are received.
Another area that actually causes double expenses for grain and oilseed producers is the fact that we pay twice for the same level of coverage that other commodities pay only once for. When grain farmers participate in production insurance, they pay a premium for that insurance as well as paying another premium for CAIS. We would not like to see producers set crop insurance aside in favour of just carrying CAIS, so there must be a more equitable system developed so that grain and oilseed producers do not pay twice.
One of the areas that are still not covered by any of the programs provided for the support of grain and oilseed farmers is the area of injury caused by foreign subsidies. For many years now we have had to compete against grain that is subsidized by other governments. We feel that there needs to be a greater commitment from government to provide support for farmers until a resolution is achieved through the WTO negotiations.
Perhaps a simple solution might be to increase the reference margins of grains and oilseeds producers by the amount of the injury. Whatever the chosen method is, it is an important component that is currently being left out and that puts corn producers and all grain and oilseed producers at a disadvantage to other commodities in Canada. To be clear, corn growers do not wish to depend on a government for their living, but we do need governments to provide a predictable safety net program that can be relied upon to cover the areas we cannot control, such as weather and interference in our markets by dumped and subsidized product from other countries.
We also need the federal government to be a strong presence at the WTO negotiations and work hard to increase market access for grain and oilseed producers. Canada's work at the WTO needs to send a strong message that is fair to all commodities across Canada.
We applaud the government's move to increase the dollars available to producers under the new cash advance program. This increase certainly better reflects the reality of farm sizes in today's agricultural climate.
Another area of concern for corn producers is the increasing cost of providing service through our farms that are actually for the public good of all Canadians. Many of these environmental requirements add significant cost to farmers, with no reasonable expectation of return on that investment.
The federal government must increase the budget applied to these areas, and these dollars should not come out of the agricultural budget, as they provide benefits to all taxpayers.
It is also clear that any support for producers under these programs would be considered “green” under the WTO rules and would therefore provide a base level of support for producers, without fear of trade action. A good example of this type of program is alternative land use services, which now has a pilot project running in Manitoba. Others are to follow in P.E.I., Ontario, Saskatchewan, and Alberta. These areas benefit everyone and should be given increased consideration.
We also urge the federal government to move quickly to reach full pesticide harmonization with the U.S. on old, new, and generic products. This will also provide more options for our members at less cost. Currently, Manitoba corn farmers lag at least two years behind the rest of Canada when getting appropriate chemicals registered for corn in our area, as it must all be done through minor-use registration. Since there is little funding available for this type of research, our growers must bear the additional cost of getting these registrations approved under the minor-use system. Moving to full harmonization would remove these barriers and provide safer, quicker access for our producers.
Another area of current concern is the interruption of rail service in the country. The fact that we are now into the second interruption of the season speaks to the need for a long-term solution to this problem. This is a cost to our producers. One example of direct cost to our producers is the increased cost of fertilizer in the past several months. Although this increased cost is partially attributable to the increase in corn acres in the U.S., we have seen a significant rise, again, because of the rail interruptions. In fact, there is now concern that producers will not be able to get the fertilizer at any price, simply because not enough can be moved into the area because of the rail strike. This will also increase the number of trucks on the road as farmers attempt to access the fertilizer themselves. This is also an increased cost for all levels of government due to additional wear and tear on the highway system in western Canada.
Disruption of rail services also causes grave concern with respect to the international markets, as Canada can no longer be seen as a reliable supplier. This could cause a considerable loss of sales to countries overseas and, therefore, a corresponding loss of income for Canadian farmers.
These labour disputes, along with previous disruptions at the terminals on the west coast, have put Canada's reputation at stake, and the federal government needs to take a good look at declaring the whole system used to export grain an essential service. If this is not possible, there needs to be a support program put in place to compensate farmers for lost sales due to another issue over which we have absolutely no control.
In closing, we thank the committee for this opportunity to speak of our concerns and remind you that the best programs for farmers are the programs that are simple to use, can be managed by producers on their own farms, and provide a predictable level of income in years when farmers are affected by events that are beyond their control.
Thank you again for your time, and I would be pleased to answer any questions you might have.