Agriculture Committee on April 24th, 2007

[The Chair, Conservative, James Bezan]

I call this meeting to order as we continue on with our study of the APF and our cross-Canada tour.

I want to welcome to the table, from the Agricultural Alliance of New Brunswick, Vince Kilfoil and Charline Cormier; and from Eastern Greenway Oils, Ray Carmichael and Stephen London. We have two individuals appearing this morning: Don Bettle and Robert Speer. Welcome.

Organizations are allowed up to ten minutes to make opening comments and individuals five minutes a piece, so that's the way we're going to kick it off.

We're going to lead with Mr. Kilfoil. You're on first.

[Vince Kilfoil, First Vice-President, Agricultural Alliance of New Brunswick]

Thank you very much. It's always nice to have the first say, but one's always apprehensive about what others might have to say behind you. Good morning.

Thank you, on behalf of the Agricultural Alliance of New Brunswick, for taking the time to come to our beautiful province and all the provinces across Canada to hear the concerns of our industry. I would also like to thank you for inviting our association to participate today.

By way of introduction, the Agricultural Alliance of New Brunswick is a relatively new organization. We have yet to celebrate our first anniversary. However, we are the product of the amalgamation of two former federations of agriculture, each of which previously represented one of the two official languages of New Brunswick—French and English. We now share the knowledge, history, resources, and leadership of two well established organizations with very dedicated memberships. However, we now speak with one voice and share common goals in providing New Brunswick's producers with proper representation.

Personally, I own and operate Erin View Farms Ltd. I'm primarily a potato producer from Johnville, New Brunswick, in the upper Saint John River Valley. I was the former president of the Agriculture Producers Association of New Brunswick until the amalgamation of the two associations last July. I chaired the coordination committee that helped being the two federations together. By way of qualification, I am not a stranger to the issues of producers in the province but certainly don't consider myself an expert on solutions that will bring agriculture from the crisis we are in right now in Canada.

Of course our hope and dream as producers and as an association that represents producers is that we would be part of a very successful, dynamic, and vibrant industry where all stakeholders, especially producers, would have the opportunity to succeed, be profitable, and continue to be world leaders in delivering to Canadians and the world a safe and environmentally friendly source of food. At the same time, we want to continue to be major contributors to the Canadian economy and the rural communities we live in.

To do that, however, we need to provide primary producers with the policy environment and tools to enable them to achieve sustainable net incomes. It is our hope that a second generation agricultural policy framework will build on and improve some of the initiatives undertaken under APF 1 and make some major advances towards some long-term solutions for producers, providing them with some of the tools and policy environment that is so desperately needed in our industry right now.

A major component of any strategy has to include a risk management pillar. As producers, we can do the very best job at home on the farm but be significantly and negatively impacted by factors beyond our control. We are in a very risky business. We need all the very best tools available to enable us to manage that risk. Because of the diversity of our sector, both here at home in New Brunswick and throughout the rest of Canada, risk management must include a suite of tools from which producers can choose to tailor a proper program that best manages the risk of their own operation. The CAIS program has worked very well for a lot of producers, but it doesn't cover everyone all the time and does little to address declining margins.

Many operations have diversified in order to spread out the risk, and CAIS fails in many cases to provide the coverage needed on these operations. We would propose that declining margins, a problem within CAIS, could be somewhat addressed by allowing payments received under CAIS, meant to restore production margins to a 92% level, as eligible income. Including these payments as eligible income in those years when shortfalls occur would help to mitigate some of the issues around declining margins.

We support a top-tier NISA-like approach within CAIS, as proposed by the Canadian Federation of Agriculture under its Canadian farm bill. This would add some predictability and some bankability to the program as well as provide producers with some ownership of that program.

We also feel that affordable production insurance should be made available to all commodities as a supplemental tool to CAIS in managing producers' risk.

We also feel that major disasters that occur, like BSE and the avian flu, for example, are almost impossible to manage and compensate for under current risk management programs. So we would support the establishment of a catastrophe fund to deal with specific critical situations that occur.

It also should be recognized that supply management and its pillars should be maintained, supported, and recognized as an integral part of a business risk management program. As with all pillars of the APF, we would support regional flexibility. Canadian agriculture is a very diverse sector, and Canada is a very big country. Regions need flexibility to tailor programs and provide companion programs that allow for the very best and most efficient delivery of support in their region.

Another concept discussed around our board table is a business risk management self-assessment program, similar to the environmental farm plan, where on your farm you would be able to self-assess the risks that are present on your farm and what you could do to mitigate some of those risks, and make some of the funding that is available under current business risk management programming available to help mitigate the risks on your farm.

At this point, we feel it is very important to recognize that we cannot associate business risk management or any of its programming with providing sustainable profitability for the sector, as primary producers. If we are depending on business risk management programming to return profitability to the sector, then as primary producers we are definitely headed down a dead-end street. We as producers are certainly not very proud of the fact that $8 or $9 of every $10 spent under APF 1 was used for business risk management. If we could turn the tables so that $6 or $7 or $8 of those dollars were spent on strategic growth, innovation, science, market-driven research, food safety, and environmental stewardship, and rely on extracting a consistent profit margin from the marketplace, where it should come from, we could well be on the road to recovery and succeed in reaching our goals.

We feel that in order for this to happen, we must have the right policy environment, regulations conducive to growth within the sector, and a realignment of trade-distorting barriers. Proper industry consultation would, and should, be used to help Agriculture and Agri-Food Canada develop a long-term vision for this sector. After all, we are the ones with everything invested, and in some cases I mean everything invested. We are the ones with the most at stake and the most to lose. By definition, we are a major stakeholder, and we are the part of the value chain with the least amount of say, the least amount of control, and suffering the most right now. Renewal for our industry is at a critical stage.

A new direction for agriculture that will allow us to grow and prosper must be able to return to the primary producer some level of sustainable profitability. Agriculture is the number one sector in several provinces, and very important to many others. It certainly is an important sector to the economy of New Brunswick. Agriculture is a major contributor to both the gross domestic product and the trade surplus of the nation. The sector is way too important to Canada and Canadians to ignore. This country was built around agriculture production. Agriculture is the lifeblood that flows through rural Canada.

Any new agricultural policy framework must only be part of, and complementary to, a longer-term strategic plan and a very clear vision, with goals and roles well defined, and some level of accountability. Without that, agriculture may not recover from the crisis that we're in right now.

I'd like to thank the committee for inviting our association here this morning and for indulging me in my own twist on what should happen.

[The Chair, Conservative, James Bezan]

Thank you, Mr. Kilfoil.

Mr. Carmichael, you're up.

[Ray Carmichael, Business Development Manager, Eastern Greenway Oils Inc.]

Thank you, Mr. Chairman, and welcome to committee members. We too appreciate this opportunity to bend your ear on a few of the issues, as we see them, as a fledgling start-up company in the biofuel business.

We certainly recognize that a strong agricultural policy framework is a very necessary and significant tool for guiding Canadian agriculture toward the next century. Certainly the themes that have been identified, of business risk management, market development and trade, environment, food safety and quality, renewal, and innovation and science, all capture the essence of the challenges that will face agricultural stakeholders in the years to come. However, from our experience, there's a cautionary note that this be not used as an excuse to create a monolithic agriculture industry in the country.

Canadians are proud of their multicultural heritage, and this is recognized as part of the central government psyche in Ottawa. It is therefore somewhat disconcerting to us that the same central body of bureaucratic thought that's centralized in Agriculture and Agri-Food Canada cannot recognize that Canadian agriculture is multi-climatic. Certainly we can have national policies, but we must have regional programming and, perhaps more importantly, local delivery to fully exploit the potential of each of the micro-climatic areas that exist within this great country, and more definitely within Atlantic Canada. Certainly the climates between the upper Saint John River Valley of New Brunswick, Prince Edward Island, and Nova Scotia are as vastly different as they are across the country.

As a recent example, previous Agriculture and Agri-Food Canada policies, through an organization referred to as the Prairie Farm Rehabilitation Administration, essentially eliminated N.B. and P.E.I.'s birthright as the largest potato-producing area in Canada by irrigating vast parts of Manitoba and Alberta, while these eastern provinces, in the cradle of Confederation, were denied any similar funding to remove their natural impediment, which is wet, acid soils. Currently, this same organization is attempting to irrigate and reforest much of the arable land in the region. So an effective agricultural policy framework must have the flexibility to identify local opportunities and build on their strengths.

The bio-economy can be an important element of agricultural policy because it holds a partial solution to petroleum's problems, namely that this resource is finite and it is increasingly expensive to extract, and there is strong evidence that fossil fuels contribute to global climate change. However, this does not mean that we can forsake the other pillars of the agricultural policy framework as mentioned and move forward.

We have a couple of comments on each of these that we'd like to submit.

On the business risk management side, certainly we need support for those industries that do not have supply management and are facing things like subsidies in other countries, currency exchange differences, open market trading, and more importantly, political instability. Business risk management must include some sort of crop insurance, like we have for random weather and pest occurrences. This is actually probably going to be more important if we believe some of the people on global warming, that we're going to have more extremes of climatic events. Certainly, risk against that is not really fair to be taken out of the averaged income formulas that are familiar with CAIS and NISA. They're separate issues.

Whatever the forum, business risk management programs that are put forth must be timely and they need to be predictable. You simply cannot make investments or secure creditor confidence on something that's a year or more in coming and you never know what you have.

Trade and development is just part of doing good business, but Canadian agriculture must have equal access to production technologies, such as chemicals, to be competitive in the global market. We cannot be expected to produce safe, quality food for the same as or less than that which can be imported from other countries using chemicals and technologies, and even social practices, that we don't accept in Canada. We must maintain a level playing field in our trading policies, and to some extent even within Canada.

Food safety and quality is very important. Canadians are increasingly concerned about the impact of animal and plant health on human health and the environment. Moreover, health issues are growing in importance, and food has a central role to play in our overall health strategy.

However, the Canadian farmer must be rewarded for any extra costs associated with embracing environmentally sustainable production and minimizing the impact of plant and animal diseases while providing a safe supply of food to Canadians. Such an increased return has not yet been realized by the primary producer. In fact, it's simply another one of the things you must do if you want to sell, and there are no mechanisms to recover this.

On the renewal side of things, yes, the real value of agricultural production has tripled over the last 45 years and the number of farms have been halved. Unfortunately, this trend is probably going to continue as it has throughout history. However, for a labour-challenged industry, we believe renewal programs should not encourage an exodus of highly skilled workers from the agricultural industry. Future programs should provide only targeted assistance designed to encourage retention of this talent, which is a human resource in the agricultural industry, and encourage new participants.

On the innovation and science side of things, technology development programs should not be restricted by arbitrary enterprise maximums. We've found it difficult when there's been a certain cap, regardless of the scale and size and gross output. And I think it should be recognized in much of the policy that these caps in technology development, science, and research that's carried on at the farm should be scaled to the size of the operation. The larger operations can sustain new technologies and development and support the ultimate use of it by the smaller operators. It's inequitable to have these things arbitrarily capped on a per-farm-unit basis when it comes to innovation.

Furthermore, Canada's slow approval process for new products is hindering research and development of many things, like the bio-pesticides we're working on with mustard. Simply, the hoops that you have to jump through are...I'm not going to say insurmountable, but certainly friends in other countries don't face those same delays over what appears to be petty bureaucratic processes.

On the environment side, similar to the food safety issue, I think farmers must be provided with a fair return if they're expected to provide ecological goods and services to the country. And that may be part of a best business risk management program. You simply can't legislate that the farmer must stay so many feet away from a brook or a stream or plant trees for the good of the country unless there's a return in the marketplace.

More importantly, I have a few comments on the renewable fuels side, which we feel is perhaps our best area we see at the moment.

We would like to point out that we are, as small as we are, Canada's only fully integrated biodiesel producer. When we say “fully integrated”, we mean where the shareholders grow the crop, process the crop, and sell the crop. So that gives us a slightly different perspective, aside from our small scale and our small size, than that of most of the other messages you've heard from our big friends out west.

One of the things that are befuddling this industry is, of course, that biodiesel is not ethanol. There's a real danger for this potential commodity to get swept up in the food versus fuel debate over ethanol and corn. I would like to remind the committee that 81% of the well-to-wheel energy in biodiesel is renewable. And biodiesel, unfortunately, is at least two years behind ethanol in policy development, commercialization, and research and development. So we need a bit of time to catch up that component.

It does have a real potential. Canola, in particular, is Canada's highest-yielding crop and has a real potential to remove carbon dioxide and improve the greenhouse gas environment. For example, vegetable oils can reduce 64% to 92% of greenhouse gas emissions compared to petroleum diesel. A 20% blend of biodiesel with petroleum diesel reduces 12% to 18% of greenhouse gas emissions. And a simple 2% blend of biodiesel with petroleum will reduce between 1% and 2% of greenhouse gas. Canola in Canada has double the kilometres per hectare of corn.

In closing, we must remember that politics, not economics, brought us this industry. We believe that Atlantic Canada, again, needs a special look and consideration in the policy so that we don't get lost in the big-scale economics. We have potential in this region and need a unique policy when it comes to the renewable fuel strategy for Canada.

Once again, Mr. Chairman, I thank you for the opportunity to share our thoughts with you and open some discussion.

[The Chair, Conservative, James Bezan]

Thank you very much.

Mr. Bettle, five minutes please.

[Don Bettle, As an Individual]

Thank you, Mr. Chairman and committee members.

My name is Don Bettle and I have a farm in Kings Country, New Brunswick. I'm a former chairman of the Dairy Farmers of New Brunswick, and also a director of the Canadian Federation of Agriculture.

What I'd like to talk to today is monetary issues. We've seen the dollar appreciate 20%, and with farms that comes right out of your margins, the same as for other processors in the country and manufacturers. Also, we see that there's potential for the credit rate to go up. And most of us have been through the early 1980s, when we saw our credit costing us 20% or 22% or 23%. Back then we had fairly good margins and right now the margins aren't so good, so we have to be very careful that we don't allow credit for farms to go back up that way.

Right now, the average age of a farmer in Canada is 58. Within the next five to 10 years, we're going to see $200 billion worth of assets roll over to the next generation. To allow that to happen, as a country, we're going to have to come up with some innovative and very flexible financing plans with our banks and lending institutions to allow the next generation of farmers in this country to take over the existing farms without a debt load that makes it impossible for them to be successful.

We see the number of farms going down, and mostly that's farmers expanding and growing their farms to be more efficient and to produce more of whatever they're producing because the margin keeps going down on that product. We've seen subsidized products come in from other countries, and there seems to be, we say, a reluctance on the part of the consumer of Canada—the cheaper they can get the product, the better they like it.

But there are demands, as I think Ray has mentioned, on Canadian producers to be more and more conscious of food quality. I go home and I see a bottle of relish on the table, and it says “Product of India”. What kind of food quality do they have in India? They sell milk on the streets in open containers. But that product comes into Canada and competes with local vegetable producers. That's just one example.

They're just some of the issues that I wanted to bring up. I'm just an individual representative here, so I won't take a lot of time from the guys who are representing their producers.

Thank you.

[The Chair, Conservative, James Bezan]

Thank you.

Mr. Speer.

[Robert Speer, Dairy Producer, As an Individual]

Thank you, Mr. Chairman.

I was given a lot of freedom when I was asked to come here as an individual and not have to represent any particular organization. I will just take a moment to say who I am as an individual.

I graduated from UNB with a master's in forestry. I worked 10 years with the provincial government in forestry. Then 20 years ago my wife and I bought a small dairy farm. The farm is now four times the size it was then, and we have four times as much debt as we paid in total for the farm at that point.

The question was, what would I like to see at the end of this next APF agreement? I guess basically what I'd like to see is the government spending a whole lot less on business risk management but spending the same amount of total money. I'd like to see our dollars coming from the marketplace and us in a position where we don't need business risk management to the same extent.

I suppose the question is, how do we get there? I have a few thoughts. My suggestions would be through knowledge and through creating the right atmosphere in the industry.

In terms of research, which is where you get some of your knowledge, I saw a picture about a year ago, and there were 31 combines coming down across a huge field. In the dust of those combines there was a whole raft of seeders coming along, seeding the next crop. If we're going to be in the bulk commodity, that's what we have to compete with. We can't compete with their climate and their soil and their wage structure and so on. So what we have to do is be out in front of those 31 combines. We need new ideas, better products, better production techniques, so that we can be planting this year what they're going to plant next year. We need the research, and that's where government can have a significant role.

So how do we decide what research to do? We need to be constantly looking at where agriculture is going to be. It's too late to be looking at corn-based ethanol plants. What's going to be the next big thing? That's where we should be doing our research. A suggestion or a thought would be something to do with crop residues being processed close to the source, so that byproducts can go back on the soil and we don't end up depleting the soil.

We need to have the best minds from producers, processors, consumers, the government, and researchers looking for new opportunities. What about having a website where people, if they have an idea for a research project, can submit the idea? The more ideas you have, the better opportunity you have of getting the new product, the next new big item.

I'll move on to education. We need the right kind of education, both in the schools and available to existing farmers. The research I was talking about earlier is no good if it doesn't get to the people who are managing the farms. At the present time farming is a business, and if you're going to succeed it's the good business people who are succeeding in farming. Yet when I hear discussions about agricultural schools and training courses, it's about how do I grow a new crop, or how do I have a new production technique or livestock management? It's rarely about business management. It's management on the farms that makes a big difference between whether they are profitable or not.

Just as an aside, I'm a member of a dairy club in this area. There are 12 farms in the club. We're all paid the same for a kilogram of solids produced, yet there's a range of $5 per kilogram in net income on those farms. We share our financial numbers. Just to put it in perspective, $5 on my farm is $150,000 a year. That's the difference in net income on those 12 farms. It's not related to size and so on; it's the management on those farms. To put it in perspective, my farm has half a million dollars in gross income and a difference of $150,000 in net income.

I mentioned atmosphere. By atmosphere I mean how we as an industry view ourselves. Together, we—farmers, industry partners, and government—need to create an atmosphere where we see the glass half full and rising, not half empty. There's truth in the idea that if we think we can do it, it's probably true, and if we think we can't do it, it's probably true.

Look at what's happening to corn prices with the ethanol production. I could look at this and say, my feed prices are going up, so I'm not going to be profitable. Or I can look at it and say, great, somebody else is going to pay part of the corn producers' cost of production, so I don't have to pay it all; now, how do I take their byproduct and put it into my farm? Is there research done so that I know how to do that?

I have two other comments. Regulation is an area where government can be involved. You need to encourage and not discourage enthusiasm in the industry. Keep the regulations quick. Opportunities are time-sensitive. Make it simple, fast, and effective to deal with regulations or to change them.

As to renewal, farming is a great lifestyle. It's easy to get excited about farming. If existing farmers start each day with enthusiasm for what they do, then the next generation will want to get into farming and keep the renewal process going.

In closing, I see government's role in a new APF as helping to generate the knowledge, helping farmers identify and overcome their knowledge gaps, and creating an atmosphere where there's enthusiasm for farming, where farming is profitable, and where there is much less risk for business risk management.

Thank you, Mr. Chairman.

[The Chair, Conservative, James Bezan]

Thank you.

With that, we'll open it up to our rounds of questions. We're going to stick with five-minute rounds.

Mr. Hubbard.

[Charles Hubbard, Liberal, Miramichi, NB]

Thanks, Mr. Chair.

It's certainly good to be in New Brunswick, our home province, one of the best ones in Canada.

What we heard in the presentations this morning certainly reflects a lot of thought and a lot of concerns and some very new ideas. It appears that the finances and the debt capitalization of farms is a major factor—what you can carry.

Robert, you've been in two industries now, and it seems that your love of farming has overcome your original intentions in forestry.

Forestry, Mr. Chair, is a big factor here in New Brunswick. It's sometimes sad to see that some of our better farmland is being converted back to growing trees. I see a lot of that in my own constituency, in the Belledune and Jacquet River area.

Mr. Kilfoil talked about crisis now, and he used certain visions about prosperity—sometime soon, I hope. With that, he talked about the need for growth, the need for research, the need for innovation, and built those around business risk management and all of that.

In terms of growth through research and innovation, are governments putting enough attention towards research and innovation? Have the new concepts that have developed in research, we'll say about 10 years ago, helped your industries here? Or has it been more difficult for you to see real results from the research, which is often done by major players rather than back at the farm level and within your own community?

[Vince Kilfoil]

First and foremost, it's important that we keep research funded publicly rather than privately, so that it is true research, non-biased research, and research that farmers can take back to their operations and implement into their own businesses and operations, and so that they can be the benefactors of that research and not a privately funded or corporately funded research scheme, where the real profits from that research are put into the hands of the corporations and away from the primary producers.

[Charles Hubbard, Liberal, Miramichi, NB]

With the problems you're encountering right now with the sale of your potatoes in other countries, do you feel that government is helping enough to get those markets open for you? In particular, I guess you're having problems in Venezuela and other places where maybe a more aggressive stance would help.

[Vince Kilfoil]

I think that's certainly true. We could certainly use the help in opening up some of those doors. We felt there was some potential in Algeria, and it's my understanding that that door has been closed because of trade issues and other previous trading relationships that may have gone bad. That's true in a lot of other jurisdictions. Whether it's trade barriers or past relationships with some of those countries, they are restricting current trade.

[Charles Hubbard, Liberal, Miramichi, NB]

Ray, with your biofuels, we've heard reports in other provinces on the need for investment and the need for being able to cooperate with government and lending agencies to get the biofuel industry going. What's actually happening with your group? Do you see support from governments?

[Ray Carmichael]

We've been rather fortunate over the last couple of years with government support, both provincially and federally under the BOPI. I think the risk that we see is twofold on this project. Ag Canada is centralizing all of its research to national institutions, so all of the expertise is essentially in western Canada. This is a big country, and it's hard to get some of the intimate details of making it happen.

The other thing is that we have a small market, as those of you who are familiar with our geography know. But we do have collectively a significant market in Atlantic Canada, so we do feel that perhaps the biggest thing is that we're dangerously close to competing with ourselves. With a little plant in Prince Edward Island and another little plant in northwestern New Brunswick and maybe something else in Nova Scotia, we end up dividing a small pie in three. We don't have the economics.

Our biggest challenge, though, is actually the U.S. blenders credit, the subsidy they're putting on ethanol and biodiesel. On biodiesel, that translates into a 26¢-a-litre subsidy. So product from the United States, out of New York, can be landed into Woodstock, New Brunswick, for 68¢ a litre—last week. At the same time, the German subsidies, the European subsidies, are shoving the price of canola and everything up. So we're caught with a high-value raw product going in, U.S. blenders credit subsidy sitting right on the border beside us, and the rumour is that there's going to be a 100-million-litre plant built in Holton, Maine. Those are our bigger challenges.

Finally, Mr. Chair, I want to allude to something we mentioned here, the PFRA. It's a program that started back in the 1930s in western Canada. It pumps a lot of money into those provinces. There have been some initiatives with PFRA into New Brunswick in the last few years, but really, in terms of programs or funding, it's a good point for this committee to receive that a similar program that is green would be a big factor in the potato industry and other industries here in Atlantic Canada. Maybe, Mr. Chair, we should look at that sometime. It's a program that gets annual funding, a big amount of funding. Maybe, Vince, in the potato area of Grand Falls, you do have some initiatives from PFRA?

[Vince Kilfoil]

I wouldn't be qualified to comment on all the specifics of that, but I think we are now available for some funding under that program, to deal with water in a different way than they do in western Canada.

[Charles Hubbard, Liberal, Miramichi, NB]

Thank you.

[The Chair, Conservative, James Bezan]

Thank you, Mr. Hubbard. I didn't realize the PFRA was the Prairie Farming Rehabilitation Administration.

[Wayne Easter, Liberal, Malpeque, PE]

On that, it was expanded two budgets ago to all of Canada. PFRA has been in the west since the 1930s. It's an excellent program. It's one of the most well-liked programs in the west, and it's been expanded across the country in a little different way.

[Barry Devolin, Conservative, Haliburton—Kawartha Lakes—Brock, ON]

What is PFRA?

[The Chair, Conservative, James Bezan]

It accomplishes two things in the west, at least. It was there after the dirty thirties, so it was there for soil protection, water erosion, wind erosion. It did a lot of tree planting, shelter belts, protecting yard sites, and cutting down on the wind out on the bald prairies.

Mr. Kilfoil.

[Vince Kilfoil]

I have one final comment to help answer Mr. Hubbard's question. I understand you're going to hear from the potato agency, Potatoes New Brunswick, this afternoon, and your question on trade barriers and restrictions is probably a lot better answered by them.

[The Chair, Conservative, James Bezan]

For those who require translation services, the equipment is in front of you.

Mr. Bellavance, you have five minutes.

[André Bellavance, Bloc, Richmond—Arthabaska, QC]

Thank you very much for your presentations.

Mr. Kilfoil, you raised an interesting point. You were limited to five minutes for your presentation, but you talked about the need to create a special disaster fund. I would like you to talk a little bit more about that.

The current government has said that there should a disaster relief program for risk-management purposes. The program has still not been created. In your opinion, what kind of program is needed?

[Vince Kilfoil]

If we could use a couple of very good examples, the BSE crisis in Canada and the avian influenza that struck B.C., the only way to compensate a lot of producers was through the current BRM funding.

Those very crisis-specific and regional issues—well, BSE wasn't regional—are very hard to address with current BRM programming like CAIS, crop insurance, and production insurance. Other very regional and very local weather issues happen sometimes, and it's probably hard to address the need and the hurt under current BRM programming. It's not conducive to maintaining a good production margin. It's not conducive to maintaining insurance levels, previous histories, and things like that. Those things should be dealt with as disasters, and the funding should be there and separate from BRM for that disaster programming.

Does that answer your question?