Evidence of meeting #11 for Agriculture and Agri-Food in the 39th Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was producers.
A recording is available from Parliament.
9:40 a.m.
Conservative
9:40 a.m.
President, Canadian Pork Council
That isn't countervailable and that has some security.
Secondly, we need the federal and provincial governments to work together to fix the CAIS program and to get it done quickly.
9:40 a.m.
Conservative
9:40 a.m.
Conservative
The Chair Conservative James Bezan
Mr. Wildeman, did you want to follow up on that? You have just a few seconds.
9:40 a.m.
Vice-President, Canadian Cattlemen's Association
Yes, I have just a very brief comment.
An ad hoc likely isn't the best thing to do, but we have a program and we have to make it work because the program we have isn't getting the chores done either. So although there's a lot of concern about countervail, I met with producers today who said that on February 1 they can't meet payroll. They have to decide who's not getting paid so they can pay their employees. That's February. What's going to happen in March?
This guy is a large trader, but he said, “I can tell you, countervail is getting to be a lot farther down on my list of things to be concerned about unless we get this fixed.”
9:40 a.m.
NDP
Alex Atamanenko NDP British Columbia Southern Interior, BC
Thank you very much.
I'm going to start by asking a question. You've touched upon this as an Ontario pork producer and I'd just like your comments on it. With the financial crisis and the lack of liquidity among farmers—or, simply put, the lack of cash—and given that tomorrow is the first day of the month, what is the probability that farmers will be unable to provide basic animal welfare needs such as feed? Is tomorrow going to be a Black Friday for the pork industry in this country?
We're coming right around to it. We seem to be talking. Everybody has good intentions, and I do believe our minister and the government have good intentions. These are not evil people around here. However, something isn't happening. It's a possibility, in your words and in the words of this producer, that tomorrow is going to be Black Friday.
Have inspection fees been waived? Why isn't the cash flowing? None of this seems to make sense when we have an industry that's basically falling down. I want to get some comments, maybe from both sectors, before I continue.
9:40 a.m.
President, Canadian Pork Council
Cash is a huge problem. It's not a normal low. We don't want to lose the infrastructure in this country. We don't want rural Canada to be decimated, so absolutely. There are COD feed deliveries now, and at a certain point the unsecured creditors say we can't go any further. When that starts to happen, we're not sure what's going to happen.
9:40 a.m.
Vice-President, Canadian Cattlemen's Association
I think the cattle industry is somewhat behind that. Ours is a little longer production cycle. We don't have the things happening, but equity is being lost. What has happened is that some of these people have gone to their lenders and extended their loan provisions, but they're now finding out that even with those extended loan provisions, the banks are getting hesitant to actually advance against those loan provisions because they don't see an end in sight and they don't see this problem being dealt with.
So I don't think we'll have the crisis on Friday, but these losses continue to occur, and at some point we're going to see the same thing. And we're starting to see that, because we're seeing fewer cattle being placed on feed. We're seeing a lot more cows come to market.
9:45 a.m.
NDP
Alex Atamanenko NDP British Columbia Southern Interior, BC
Just as a follow-up, the last time we were here, in December, your colleague from Quebec asked us how we can help you compete against foreign governments. That seems to be part of the problem.
Mr. Wildeman, you mentioned that we need a new look in dealing with international trade, that we have shortcomings. Then we have this whole problem of countervail, and often the stance of this government in dealing with any international obligation is that we have to be very careful of our trade obligations. We can't do something that would be harmful in this respect, whether it's in the fruit industry or in the cattle or pork industry. So is there something we should be doing?
You mentioned also, Mr. Wildeman, that some producers are saying, “Well, countervail, that's not a major priority”. Is there something we should be doing here?
9:45 a.m.
Vice-President, Canadian Cattlemen's Association
I think the report that came out of this committee not very long ago would go a long way toward doing that. We're saying the foundational building blocks of a good business risk management program are here.
The devil's in the details. We've tried to help with those details. We've tried to be creative about some things. We continue to try to come up with creative solutions, but the reality is we're not going to deal with this crisis unless somebody's going to change these things and be willing to fund them.
We can make all these changes, but the problem is if no money flows, we're just having a pretty interesting discussion. The problem is that while we're having an interesting discussion here and in the provinces, producers are going broke.
If you can't make payroll, do you really care about the future of trade? We know that in the long term the beef industry depends on trade and the pork industry depends on trade. We're 60% reliant on trade. We've made a pretty good living in that. We think there are more growth opportunities there. We're excited about the opportunities for the beef thing. If Canada gets serious, we think we can gain significant market share in some of these countries, but of course you have to get there.
We're in this dichotomy in which we know where we want to go and we see some tremendous opportunities down the road, but we're not sure who's going to be left standing when we finally get to that opportunity. That's the problem we're into today.
9:45 a.m.
Director, Canadian Pork Council
I think we're in the same boat. We're very concerned about trade. We're getting producers coming to us saying the same thing, that if they can't meet their payroll, then why should they worry about trade? I think that's the reason we have said from the outset that we want a loan program that would deal with liquidity, because then producers can make the proper decision and not the decisions they make when the feed truck won't come unless they have the cash for the COD.
9:45 a.m.
Conservative
9:45 a.m.
Liberal
Ken Boshcoff Liberal Thunder Bay—Rainy River, ON
Thank you very much.
On Tuesday evening at the late show I asked some questions of the parliamentary assistant, the very questions you asked: Could the government do more? Had the programs fallen short? Was December 19 a cruel joke? Why is the province there and not the feds? I was told that it was well in hand; the funds were flowing; the problem was essentially solved. I find there is a great contradiction between what I heard on Tuesday night, which is in Hansard, and this, so I'm more shocked.
At this time, I think we really want to discuss solutions and that particular issue of discriminating against the family farm. I think many of us get into the business, as members of Parliament, to really protect individuals and the continuation of that business.
I'll also be sharing my time with the honourable member from Brant, who has a question too. If you could, address that part of it, and then the honourable member will ask his question.
9:45 a.m.
Vice-President, Canadian Cattlemen's Association
My answer will be short. If somebody thinks the problem's solved and the money's flowing, they might want to come out to Saskatchewan. I could perhaps introduce them to some producers. That's my comment on it.
Certainly, again, we've continued to work on it, and officials have been open to the discussions, but right now we need some actions, and they're not doing that.
I think the question of the family farm is an interesting one because I think it comes to the whole root of the cap issue. People say, “Well, what is a family farm these days?”
Again, this producer I sat with the other day, who's in dire straits, started with nothing in 1985, and he has 250 employees. He has barns operating all over Saskatchewan, but every member of his family works in that barn. He has pledged everything, including his own home, against that hog thing.
Is his not a family farm? Doesn't he deserve the same protection as every other producer? He's not a Cargill. He's not a corporation. He's a guy who's put every penny and worked seven days a week to build his enterprise, and he is going to lose it all because this program doesn't meet his needs.
9:50 a.m.
President, Canadian Pork Council
My response is very simple: the time to talk is over; the time to deliver is now. Talking doesn't help us anymore. The direction needs to come from the political side down. We've been working with the bureaucrats for about two to two and a half months, and I think they're very clear on our position and our understanding. There are some possibilities and some opportunities. It may take the cooperation of all parties to make it happen quickly now.
9:50 a.m.
Liberal
Lloyd St. Amand Liberal Brant, ON
Thank you, Mr. Chair. I appreciate my colleague allowing me an opportunity.
Mr. Schlegel, I have two questions for you, if I may. You have categorized the December 19 announcement--and I'm using the term loosely--as a cruel joke on the producers. I presume you're saying it was an announcement without meaning, without substance, with no relief whatsoever being provided for the producers. That's my first question to you, Mr. Schlegel or Mr. Moffett.
Secondly, in terms of the numbers, how many farm families in Ontario are recorded as having already gone out of business or as very soon to be going out of business, and how many market animals does that represent?
9:50 a.m.
President, Canadian Pork Council
To answer the first question, I have two examples. There was a producer in Middlesex County who took out the APP. He got his money. Two weeks later he got a CAIS cheque, but it went to pay off the APP.
The second story is about a young producer in Perth County, who was counting on the APP to provide additional credit to help him through the spring and then realized the bank was simply going to reduce his credit line.
That's why we call it “a cruel joke”.
With regard to liquidation, be assured that it is happening in this country more than the United States. It's starting in the U.S. as well. The issue for Canada is whether we want to continue to be a value-added export sector in the red meat industry and compete around the world. If that's the case, we need some help in this unusual normal low to adjust to the new world reality of this currency situation.
Stephen, do you want to add something?
9:50 a.m.
Director, Canadian Pork Council
You asked about how many families there are. We know that in Ontario alone, 52,000 sows have gone to market. That represents about a million hogs a year and about 50 farm families. That's a lot of people.
9:50 a.m.
Conservative
Carol Skelton Conservative Saskatoon—Rosetown—Biggar, SK
I want to follow up, Mr. Schlegel, on what you said about the CAIS cheques and the young producers. Can you tell me exactly what we need to do to help that young producer, so we have it on the record?
9:50 a.m.
President, Canadian Pork Council
We need loans that are available that come in behind the bank for security reasons. If APP is going to be the vehicle we use to address that, then we need significant legislative change to make it possible.
9:50 a.m.
Conservative
Carol Skelton Conservative Saskatoon—Rosetown—Biggar, SK
What would those significant legislative changes be?
