Evidence of meeting #6 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 program.
A recording is available from Parliament.
4:25 p.m.
Executive Director, Canadian Co-operative Association
The patient capital fund would be over five years, and it's $30 million for advisory services.
4:25 p.m.
Liberal
Charles Hubbard Liberal Miramichi, NB
Our federal government really is putting very little into the promotion of it. We have pork producers on the Hill, and we have the beef people here. If you look at what's happening in those two sectors, you wonder where the money is when you go to the supermarket. It doesn't seem as though those producers are really getting a fair proportion of what product is out there.
In terms of the business risk management, Mr. Chair, some of us have been on this committee for quite a long time. You have been for quite a few years.
What would it cost our government if we expanded it and tried to present it to our government in the way you seem to be suggesting? Has anyone costed what you're suggesting? Would it be $3 billion, $4 billion, or $5 billion annually? What kind of money are we talking about?
Maybe Jacques is going to answer.
4:30 p.m.
President, Dairy Producers of Canada
I'm not sure I understand the question.
What we're requesting in here, from a dairy and SM5 perspective, is basically to have strong pillars of supply management in order to keep doing what we're doing. We're not requesting dollars or anything.
When we look at the business risk management, if there's a disaster inside the boundaries in which we operate as SM5, they should be recognized like those in any other commodities. It depends upon which kind of disaster we're talking about. I really cannot put—
4:30 p.m.
Liberal
Charles Hubbard Liberal Miramichi, NB
I thought we were hearing that your groups, too, would like to be covered by business risk management. Maybe I didn't hear it right, but I thought you were saying—
4:30 p.m.
Director, Canadian Egg Marketing Agency
Yes.
In response to that, there are a couple of things. We're looking at the disaster portion of the BRM because we were told that it's where the disaster coverage is going to occur in the future.
There are probably a couple of things from the poultry side. There is a schedule—I don't have it with me—in terms of the numbers that we looked at after the AI experience in the Fraser Valley in 2004. BSE in beef would be another one.
Continuing to enhance all of our on-farm programs will mitigate some of the risk, but the risk is still there. What we're suggesting is that, as a society, when we have those outbreaks like AI or BSE, we have a responsibility to look after those. But to say that it's going to be so much a year or so much in five years.... You can't predict when these things will happen. We hope they never will, but we need to have the mechanisms in place to deal with them.
4:30 p.m.
Liberal
Charles Hubbard Liberal Miramichi, NB
Mr. Chair, with that, two different committees have suggested a disaster fund, and we talked about a certain amount--$1 billion, $2 billion, or whatever it might be.
With your presentations on going forward, the world today--at least most of our North American world--is governed by oil. Oil has dictated our economy. When we look at your costs of production and the problems that various livestock owners are having, they're all based on oil. Corn and biofuels are based upon the cost of oil. We're talking about oil at $100 a barrel, although today a barrel is in the low nineties.
When you look at your future in terms of five years, how is oil going to reflect on your success in terms of our agricultural communities in Canada? Other countries are producing livestock and so forth without having the same demands for the feedstock that your producers are going to need.
What is going to happen in terms of the vision we would have for the next five years? With what price of oil can you still be successful, or will so much of our grains and corn be changed to oil that livestock in this country is going to be so costly that consumers and the world are going to wonder what's going on in North America and in Canada?
4:30 p.m.
Conservative
The Chair Conservative James Bezan
Mr. Hubbard, your time has expired.
Would you guys make a short response? Talk about turning straw into gold, too, if you can.
Go ahead, Mr. Fuller.
4:30 p.m.
Chair, Chicken Farmers of Canada
It's a very good question, because you're asking the price at which oil is going to start to have ill effects. The question, whether we start talking about oil or ethanol, is whether the demand for the grains is going to continue to develop. We have seen a number of reports saying that this is just a little phase we're going through and that things will start to come back in line. When I say a it's a little phase, I mean five years or ten years. It's not a long-term situation.
Most of the grains, whether in Canada or the U.S., will have some effect around the world. The demand for the grains for the energy sector will have an effect around the world, so the cost of producing livestock is going to go up around the world. What we all want to know is at what point the consumer will start to look at this and stop buying protein, and that is a concern for our industry. We've tried to look at this in a long-term range, but just like everyone else, we'd be looking at a crystal ball. It is very difficult to give you an exact timeframe, but we are very concerned. If you look at the droughts that have been happening around the world, the amount of grain available for both energy and for food production is really going to be the question of concern that we really have to answer.
4:35 p.m.
Conservative
4:35 p.m.
Bloc
André Bellavance Bloc Richmond—Arthabaska, QC
If history does repeat itself, I am worried about the agricultural policy framework. I would like to know if you share my concerns.
For the first agricultural policy framework, there was an enormous amount of consultation. In the end, specifically with regard to business risk management, the government imposed its programs. We have now gone through the same exercise for this agricultural policy framework, Growing Forward. There have been a lot of consultations. Everyone agreed that substantial program changes were required. The provinces, the producers, the opposition parties and even members of the Liberal government of the time felt that the Canadian agricultural income stabilization program, the CAIS program, needed to be changed, just to name one.
It is often said that the devil is in the details and that is what we are seeing here. After hearing your evidence today, I wonder whether programs have really been changed in order to address the deficiencies in the first agricultural policy framework.
Mr. Froese, you brought up some interesting points. You say that in AgriStability, the new version of CAIS, maximum program coverage will go from 100% to 85% of net income and that the reduction in coverage will be assumed by Agri-Invest. You also say that those who are part of a supply management program will not get the 15%.
Are you sure about that statement?
4:35 p.m.
Director, Canadian Egg Marketing Agency
Thank you for the question. That's the question that we're asking. We're not sure. I think part of it might be because all of the details of the program have not been finalized yet, as well as the funding. But that's a question we're asking because we're hearing mixed messages on that 15%.
4:35 p.m.
President, Dairy Producers of Canada
I am saying the same thing. We hear that supply management is going to be treated a little differently in some sections. We want to clarify what would happen in a disaster.
4:35 p.m.
Bloc
4:35 p.m.
President, Dairy Producers of Canada
In a disaster, a supply management producer would be compensated at 85%, whereas a producer of other commodities would be compensated at 100%. He would have 15% more.
We are keeping our ears open, because we keep hearing about all kinds of ways this could work. We want clarification.
4:35 p.m.
Bloc
André Bellavance Bloc Richmond—Arthabaska, QC
So it could happen like last time. When the program was put into effect with all its criteria, it was too late. It was only then that people found out how it worked. The government must be told that people must know the exact amount they will get back before it goes into effect.
4:40 p.m.
President, Dairy Producers of Canada
It is true that when the program is in effect, it is too late; it is always more difficult to make changes. The changes must be understood and accepted as fair before they go into effect.
4:40 p.m.
Bloc
André Bellavance Bloc Richmond—Arthabaska, QC
Mr. Froese, in the Canada Gazette, we learned that the compensation for hatching egg producers has changed a great deal. Mr. Haikal, I think that you could answer that as well.
In the new government regulations published in the Canada Gazette a few months ago, compensation for people who have to destroy their flocks in the case of a reportable disease is much less than it was. The government has said that it is going to implement a new program to compensate for the losses that would occur if a producer ever had to slaughter his flock, but nothing has been done on it. At least, I have not heard of a new program. People still have to settle for CAIS, or for Agri-Stability that replaced it. But CAIS does not provide adequate compensation for egg producers. If the replacement is CAIS, we are no further ahead.
4:40 p.m.
Director, Canadian Egg Marketing Agency
Yes, thank you.
That really has been our point, because we ran into that situation specifically in eggs and some of the other sectors in 2004 with avian influenza in B.C., where the Health of Animals Act can cover only for the value of the animal. Specifically in egg production, we really appreciate that, but a much bigger portion of it is if you have a big disaster like that, it's difficult to find replacement stock because producers in Canada and the U.S. generally do not produce replacement stock on speculation. So there's that factor.
The other thing is, in order to meet the market demands, you can't have all your eggs being the same size all the time. For example, if the whole flock in the Fraser Valley in B.C. changed at once, all the stores would have available in the first few weeks would be small and medium-sized eggs. We want a cross section of sizes all year, so you have to time the replacement. There's a cost to all of that.
That's why we're asking the question about the disaster portion of BRM, because we were told the Health of Animals Act is only eggs, which is limited. So yes, that's why we need clear rules on what that program's going to be.