Agriculture Committee on April 23rd, 2007

[The Chair, Conservative, James Bezan]

Thank you.

Mr. Miller is next.

[Larry Miller, Conservative, Bruce—Grey—Owen Sound, ON]

Thank you, Mr. Chairman.

Maria and gentlemen, thank you very much for being here today. It's really nice to be in P.E.I. I heard some great comments here.

I had a couple of questions for people from the potato industry. That's going to give me time to ask my other ones, because there are many.

We have heard some comments here that are consistent with what we heard this morning in Nova Scotia about regional programs. Probably the bureaucracy might tell us that it's impossible to have a national program, but even some of the comments we heard in the west last week are making me think that we need to think more along those lines. We're a big country and very diverse, not just in culture but also definitely in agriculture and geography. I think that's something we hear.

Charlie was just talking about the money that goes into agriculture. The previous government, to its record in its last year, put more money into agriculture, and this government has done the same in the last two budgets. Scott, you made a comment that throwing money at it just isn't the only answer; you have to do it with a vision and a plan. That's definitely a problem and has been for years. We need to hear some more ways to do that.

Maria, I very much enjoyed your comments. It shows the passion that is there, as John said, in the young sector.

You mentioned price floors. I think there's a problem there. There's looking at the domestic food supply and having food security, basically, for our domestic use. One of the problems government and the industry have is that we export a lot out of this country--not in every commodity, but in a lot of them. Would you have any ideas on how we would deal with that issue? Is that something that young farmers have touched on, or anybody else sitting here?

[Maria Smith]

I think Mark can also comment on this. We had a brief discussion about price floors. It was actually his idea to bring it into the presentation on how we're going to develop business risk management.

Price floors are more of a guarantee for producers. They are developing that gap between the retail level and the producers. For example, why do you see pork in the stores for $2 a pound when we're only getting 20¢ of that share? Where is the money going in the middle? How come the money is not getting back to the farmers? You can look on Google; Loblaws is coming off its fourth richest year, and farmers are coming off their four worst. How can we figure out why this is?

Especially, I want to emphasize that we need to have a price. If hog farmers not getting $1.50 for their product, then they're not even meeting cost.

[Larry Miller, Conservative, Bruce—Grey—Owen Sound, ON]

Okay. Maria, I think I know where you're going on this. If we had floor prices in place, do we guarantee them for the domestic supply, and then you go on the world market for anything that's exported, or do you continue it for every product right down the line? That's where the complications come in. That's mainly why I'm--

[Maria Smith]

Well, I imagine you'd have to look at that federally.

Mark, do you want to comment?

[Mark Bernard]

Yes. The problem then becomes that when you go into a global scale, a lot of products aren't on the same level. Everything would have to be brought onto the same playing field so that you would be competing apples with apples, and that doesn't necessarily happen.

The price floors model would be a possibility. Putting legislation in to remove loss leaders from retail stores might also be a better possibility there. When you're going into a retail store, your potatoes and your eggs--well, your eggs and your milk are supply management, so they're always going to be that price, but your fruit and vegetables that are produced in Canada, as well as your potatoes, are never going to be at a price that is lower than the cost of production. You're going to make sure the farmer is always going to be there, that the retail store is never chewing at the wholesaler to get that product cheaper and cheaper, with the price always being pushed lower down the line.

[The Chair, Conservative, James Bezan]

Thank you, Mr. Miller.

Mr. Steckle, you have time for about one question.

[Paul Steckle, Liberal, Huron—Bruce, ON]

I will take my five minutes, because I have something to contribute to this meeting.

You people have given me something to think about, because some of the things you have said I have been saying for two weeks, or for the time we've been on the road.

Scott, you mentioned that we need this whole idea of food security, and that's important. We need to have a policy where government takes a position that food security in a nation-- or “food sovereignty”, as was suggested by one of our speakers earlier today, I believe--is important.

As for profitability, if profitability were a buzzword that was real in the farm industry, Maria, Mike, and Ivan would have no problem getting into the farming business.

If we had a government--and I'm not saying this Conservative government, but any government--if we had a Canadian government that believed that food security was as important as buying heavy-lift transport planes—because we can find the money very quickly to do that, we can find $3 billion very quickly, and I use that as an example—we would find the money. First of all, you have to have a belief system that believes that food security or food sovereignty is important. If we make that a mission statement, then we need to find, and we will find, the ways to do that.

I also believe we should then make this a national program. Agriculture should be as national as defence is. I believe we should get the provinces out of the delivery of moneys on agriculture. We should have one delivery system so we at least know whose ox we're goring and who we go after. I believe if we did that, if we had a central delivery program--one federal, national agricultural system believing in the principle that I've just outlined--then we would find a way to do it, because, first of all, we have to have the will to do it.

I'm wondering if I would find concurrence, because we know the programs we've delivered have not always delivered or have not always gone to the right place. I believe that production insurance would look after some of the things you talked about, and I think the ASRA program does do that somewhat in Quebec.

Am I thinking the right way? We need to find a way, as we conclude our meetings, to say, listen, I think we've found a direction that we need to start working on and perhaps expanding upon. Am I thinking the right way? I've been at this now...for the third time across Canada, and I see very little changing over 14 years.

[Scott Dingwell]

Absolutely, we have to answer the question, and I don't have the answer. I have some strong beliefs, but I believe collectively we will come to a better answer than any one individual can provide. Food most likely will be a national security issue.

Profitability is in agriculture. I heard about a report two years ago that said 80% to 90% of agriculture is done on a profitable basis. I want to repeat that: 80% to 90% of agriculture is done profitably. The counterpoint to that argument is that 80% to 90% of the producers are going bankrupt. That is the reality in Canada. That is the pain we feel and see.

I apologize, and I respect the time, but I'm going to make one more comment. One avenue that we need to explore is the maintenance of competition. I don't think we need to fix prices, I don't think we need to have floor prices, and I think the market will fix itself. The unfortunate situation is that right now the market is completely getting skewed in competition. When you have a thousand people trying to sell to two people, the lowest price goes. If we can find a system to maintain or bring equal amounts of competition back into our sector, we will find that level where we are all profitable and moving forward.

The best example I can give you is our national banks. I'm not that old, but I'm old enough to remember that they had to amalgamate or they would die. National banks had to get together; they had to be one bank. In that time, when they were not allowed to do that, banks have been some of the best stocks to be had.

[Paul Steckle, Liberal, Huron—Bruce, ON]

Very quickly, are we on a track towards a resolution, or are we not?

[The Chair, Conservative, James Bezan]

Mr. Nabuurs.

[Mike Nabuurs]

Yes, that's a possibility that should be explored. There are far too many program levels at this point--federally, provincially. People get mixed up, and it's confusing. If we had one central administration that was delivering programs across the country and it was adequate to address all the needs, I think that's a possibility.

On the food security issue, I hate to use the U.S. as an example all the time, but they view agriculture as their safety net. Safety nets are viewed here in Canada as tools that we use to prop up agriculture. Agriculture in the U.S. is viewed as a safety net for the country. It's a mindset. We have to re-evaluate our priorities and place agriculture where it needs to be. That's why they are subsidizing corn. It's a national security issue. They're providing energy to their own country so that they don't need to buy it from other parts of the world. It's a mindset issue.

[Paul Steckle, Liberal, Huron—Bruce, ON]

I haven't heard from John yet. I want to hear whether that would give you some confidence.

[The Chair, Conservative, James Bezan]

Very quickly, please.

[John Colwill]

I guess the answer is yes. I wouldn't care whether it was federal or provincial, but I think if we had one door to go through, it would make things an awful lot easier. I have some of the larger farms telling me that the most important person on their farm is that person they had to hire to cut through the red tape to get access to programs.

[The Chair, Conservative, James Bezan]

What does the P.E.I. Young Farmers' Association say? Is it yes or no, or are you indifferent?

[Ryan Weeks]

I'd say the same. I'd echo what has been said across the table here. I'm part of the Atlantic agricultural leadership program, and we just came back from doing a tour in Washington, D.C. We met with the deputy secretary of Agriculture. You guys have probably rubbed shoulders before. I was rather impressed by the way the States run their agriculture system. I came back and asked why we can't do that. When it comes to their Farm Bill, rural development is included in it, and it's just another key to passing things along.

[The Chair, Conservative, James Bezan]

Maria Smith.

[Maria Smith]

I would like to say two things. The government needs to get its priorities in line, and we need to start focusing on agriculture. I know that the government has been working hard to try to develop procedures and to try to face these issues, but we need to move on it. That's my only recommendation.

[The Chair, Conservative, James Bezan]

Thank you.

I have just one comment. We were just following up on what Paul was just talking about, which is having one centralized agriculture department, as the U.S. does. John and Mike both talked about how it might be the way to go. But if you look at U.S. farm policy, they don't have regional flexibility. And yet, that's what we heard throughout this--that you guys want to have regional flexibility. So if you have one central U.S.-style department of agriculture, do you think you'll have that regional flexibility?

[Mike Nabuurs]

They put enough money into it to make it work.

[The Chair, Conservative, James Bezan]

It doesn't matter where you are then.

Mr. Colwill, I think you said in your opening comments that one area you're optimistic about is the interest you're getting from young farmers. I'm glad to hear that they're here and that they participated so willingly, but the conversation that we just had this evening was rather gloomy. So I'm just wondering, farm programs aside, how you guys feel about the future of agriculture here in P.E.I.

[John Colwill]

We're all pretty passionate about the industry, and we hope the future is bright. We just heard some figures quoted here: 80% to 90% of the industry is profitable, and 80% to 90% of producers are going bankrupt. So maybe that sums it up right there.

[The Chair, Conservative, James Bezan]

I'm a cattle producer, and I sure hope there is a bright future, because my kids want to farm too.

We're going to suspend, very quickly. I'd ask that the current witnesses leave the table and that the upcoming witnesses approach the table as quickly as possible. Thank you.

[The Chair, Conservative, James Bezan]

We'll call this meeting back to order.

We're pleased to have joining us, from the Atlantic Grains Council, Allan Ling. From the National Farmers Union, we have Ranald MacFarlane and Karen Fyfe. From the Dairy Farmers, we have Randall Affleck. From the P.E.I. Cattlemen's Association, Darlene Sanford. From P.E.I. Pork, we have Willem de Boer and Robert Harding. As an individual we have Doug MacCallum.

Welcome to the table.

If the farm groups could keep their presentations to 10 minutes or less, we'd appreciate it. For individuals, it's five minutes.

We'll kick it off with the Atlantic Grains Council, Mr. Ling.