Thank you.
The Canadian Produce Marketing Association, or CPMA, is an 83- year-old Canadian trade association. It represents a vertically integrated supply chain from farm gate to retail and food service. Our members include domestic and foreign companies selling and marketing fresh fruit and vegetables in Canada, so we'll be speaking about the fresh market.
Our organization has more than 675 members, including 409 Canadian members.
CPMA is aware of the requests from consumer groups, various agricultural organizations, and individual producers of both fresh and processing for changes and greater clarity in the “Product of Canada” regulations for foods produced in Canada.
The CPMA agrees that Canadian consumers are entitled to have accurate information allowing them to identify Canadian products or products grown in Canada and that these products should actually be Canadian in content. The challenge is that the issue is extremely complicated and crosses over multiple federal and provincial jurisdictions and regulations.
To fully understand the cost implications for an already strained fruit and vegetable industry, the reality of application and enforcement, and the implications for fresh produce, both domestic and imported, we must look at four core aspects within the value chain: one, bulk; two, single-package commodities; three, mixed salads and produce blends for fresh-cut fruits and vegetables; and four, the consumer.
Relative to the identification of fresh fruits and vegetables sold in bulk at retail—loose apples, string beans, Brussels sprouts—some provinces have provincial regulations that require imported, fresh produce to be properly identified as to the country of origin. If no foreign country is identified on the retail bulk displays, this implies that the product is Canadian. This allows for the use of “Product of Canada”, and also, as an example, for “Product of Ontario” or “Product of Quebec”.
The retail identification requirements for bulk produce fall under provincial jurisdiction. An initial review has identified four provinces with these requirements: Quebec, British Columbia, Ontario, and New Brunswick. If changes need to be made to meet a desired outcome for “Product of Canada” for bulk product, this would require provincial legislative and regulatory supports.
CPMA's position related to “Product of Canada” labelling on bulk produce at retail is that if new changes are indeed desired, this should be pursued provincially with those provinces without a legislative regulatory base. Where changes to the current provincial requirements might be required, this should be pursued with the provinces involved.
Additionally, if “Product of Canada” were to become mandatory, it might negate the use of provincial identification. However, one would need to examine this with each province and its current legislation and regulations. Relative to complaints regarding accuracy and compliance, this is an enforcement issue that would need to be assessed.
For single-commodity packaged produce, there are federal regulations that stipulate that product origin be properly identified. If imported, whether packaged outside of Canada or repackaged in Canada, it must have the foreign country of origin. If the product is domestic and has the address of the packer, there is no current requirement that “Product of Canada” be used. This allows for the product to be called, as an example, “Product of Canada” or “Product of Ontario”. For products that use the “Canada Grade” prefix--currently 32 different commodities--the “Product of Canada” is not required, as it is understood.
The question must be asked, do we require more information or is the issue consumer education? The CPMA position related to “Product of Canada” labelling on packaged single commodities is that any new requirement stipulating that “Product of Canada” be identified could (1) eliminate the flexibility for domestic producers to identify their specific province of production and (2) add to an additionally complex labelling system. If this is to be considered, then there should be a proviso that allows for “Product of Canada” or the provincial designation.
In addition, there are periodic problems in the fresh produce industry where firms have imported product and then repackaged it and called it “Product of Canada”. This is an enforcement issue, not a regulatory issue. This can happen innocently or intentionally. The CPMA suggests the use of the administrative monetary penalty system regulations to address this issue. However, it is our view that the fines are insufficient to act as an economic deterrent for intentional fraud activities. Heavier fines should be in place for repeat offenders and for violations of safety and security regulations. For serious violations, where appropriate, it is our view that punitive action, such as suspension of the firm's CFIA licence or DRC membership, should be entertained.
Fresh-cut vegetables and fruit and mixed commodities like pre-packaged salads are another matter. They fall under the fresh fruit and vegetable labelling regulations.
Currently in Canada, the regulations allow for the following.
If there are multiple products from different countries, then each country must be identified on the package.
For single commodity mixes, such as peppers, the type of pepper and country must both be listed. The challenge under this regulation begins when you have three peppers in a package from three different countries being repackaged in Canada. The Canadian packer must identify the red pepper from, let's say, Holland, the yellow pepper from Canada, and the green pepper from Mexico.
For mixed leafy green salads, only the countries of origin are required.
Once again, CPMA feels that the requirements are already provided for under the fresh fruit and vegetable regulations. Prior to any change, they should be reviewed to determine any deficiencies or shortfalls. As with any change, it is important to ensure that Canada not proceed to identify new regulations that would create an impediment to our exports or add costs to the industry through an increase in the inventory of packaging materials. This is especially true for Canadian operations that also export, particularly to the United States.
For fresh-cut food, most of the inputs into the products are imported. A requirement to list all the individual countries in a multiple listing—particularly given the rapid and constant seasonal change in source countries—will create a significant problem.
A possible solution for these multiple commodity products is the use of a “Packed in Canada” description. Having said that, we need to be cognizant and look at identification criteria under various trade agreements. As an example, Canada has negotiated tariff-free access to the United States for “Product of Canada”...and caution must be taken not to negatively impact this business with changes to “Product of Canada”....
Finally, there is the consumer. Many consumer groups ask that packages be labelled correctly and provide the necessary information to make a complex purchasing decision. For fresh produce, CPMA has conducted A.C. Nielsen panel track research of over 7,800 Canadian consumers. The findings show that the number one and number two influencing factors nationally in choosing which fruit and vegetables to buy at retail outlets were quality to 88% of respondents and price to 77%; followed by health benefits to 39%; locally grown produce to 36%; and organic produce to 10%.
Quality and price still drive consumer buying patterns. Consequently, it seems that while product identification is of interest to Canadians as a marketing tool to support domestic producers, it is not the primary decision factor for the majority of Canadians. The data released show that various elements influence consumers in making their produce buying decision and that “Product of Canada” is only one of them.
Interestingly, this study was done in January 2008, several months after concerns arose with some products from China—none identified or associated with fresh produce, but which became a focus of public debate on the safety of produce because of those concerns.
In summary, the CPMA appreciates the opportunity to appear before the Standing Committee on Agriculture and Agri-Food on this important subject of “Product of Canada” labelling. This is a complicated issue in today's world of commerce and changing food composition.
We wish the committee well in their deliberations, and we conclude with a simple request, that the government consult with our association as it moves ahead. CPMA would like to ensure that any changes to the current regulatory environment achieve their objectives without a negative impact upon the sector, from grower and shipper to retailer and consumer.
Thank you.