Thank you, Mr. Chair. My thanks to the committee for inviting the Canola Council here today to provide input to your study on competitiveness in Canadian agriculture.
I will give you a little background on the Canola Council. We're the only fully integrated industry association where seed and input companies, growers, exporters, and crushers all sit at the same table to develop a common platform for growth. Although I didn't bring a grower with me today, growers have four seats around our table and are very important in our discussions and our steps forward. Growth is very important to our industry. Even though the canola sector in Canada was worth $14 billion in economic activity in 2008, our strategy is to grow the crop and the industry. We hope to reach 15 million tonnes of sustained demand and supply by the year 2015. When we reach that target, the canola sector will be bringing another $12.5 billion of economic activity to Canadians.
Our mission is simple; to enhance the industry's ability to profitably produce and supply seed, oil, and meal products that offer superior value to customers throughout the world. The key to our success is the profitability of the entire value chain, but especially growers. Without growers we have no product for Canadians, no product to process or export.
We want to congratulate the committee for taking on this issue. We are a very trade-dependent country and a trade-dependent commodity. One of every three Canadian jobs is dependent on trade, and Canada is the world's fourth largest agriculture and agrifood exporter. So reviewing the competitiveness of our economy and ensuring that we're taking the steps to stay ahead of our competition is key to helping our producers and our entire agriculture sector.
This is certainly relevant to the canola sector. For the past three years, canola was the most profitable crop for producers. In 2008, it delivered $4.9 billion in cash receipts, with most of those dollars coming from export markets. Canada produces only 20% of the world's canola and rapeseed, but we're responsible for 80% of the canola trade globally.
In recent years, Canada's canola producers have relied on export markets for 85% of their sales, including canola seeds, oil, and meal. This past year, canola farmers produced a record 12.6 million tonnes. We anticipate total exports to be at or close to 90% of this year's production. This equates to nearly $5 billion in economic value from export markets. So for Canada's 50,000 canola growers, the competitiveness of our exports is critically important.
Our competitive advantage is the quality of our product. Canola is the healthiest oil on the market. It is free of transfat and cholesterol, has the least amount of saturated fat, and contains essential fatty acids like omega-3 and omega-6 in a unique ratio that health professionals say is the best for healthy eating.
On top of that, the further development of high oleic canola varieties have improved the industry's ability to supply heat-stable canola, which is best for the frying oil industry. Canola was invented in Canada and maintains its international advantage through continued investment in innovation. Access to technologies like herbicide tolerance, hybrids, and modified oil profiles is keeping our farmers ahead of their competitors. Recognizing its health attributes, the U.S. Food and Drug Administration authorized a qualified health claim for canola for its ability to reduce the risk of coronary heart disease.
Canola meal has its own unique qualities. Canola meal in the diet of a dairy cow increases milk production by a litre of milk per day. It's increasingly used in dairy rations in Canada and the U.S. Beyond food uses, canola is the best feed stock for biodiesel production, owing to its cold-flow properties, which are important in cold weather and also improve engine lubricity.
But this strategic advantage didn't just happen. Targeted investments, strategic research and innovation, trade agreements, and market promotion have been essential to building and maintaining our competitive advantage, and we need to continue to work at it to keep our competitors from overtaking us. Our competitors are not typically other countries, but other vegetable oils. The U.S. soybean and Asian palm oil industries are working to improve their products' nutritional profiles, along with their cooking and frying attributes. While canola has a strong presence in international markets, our resources are modest compared with those of the soy and palm industries. Soy and palm developers are also making improvements in the productivity of their crops. Canada's not going to be the low-cost producer, but continued gains in yield and oil content of canola are critical to maintaining our access to international markets.
Our recommendations fall into four categories. The first category is research and innovation, and I will start with the health aspect.
Continuing to enhance and differentiate canola's position as the healthiest oil is the most important aspect of maintaining our competitiveness. Through our canola product research fund, we continue to pursue coordinated research projects that address customer needs. Increasingly, our priority is nutritional research on the beneficial role canola can play with heart health and diabetes.
Partnership with government, and especially with Agriculture and Agri-Food Canada's research division, is critical in this regard. Canada needs to focus its resources, both private and public, to yield results internationally.
In the area of productivity improvements, access to innovation is key for current and future producer profitability. A regulatory system that allows new products and traits to smoothly and predictably move into commercialization is needed to ensure the future competitiveness of our canola producers. Reforms to variety registration, resourcing, and the refining of regulations on plants with novel traits, novel food, and novel feed are critical for farmers to access new technology. Attention to reasonable intellectual property rules is also necessary to keep new products moving into canola producers' hands.
New tools require new management techniques. While canola is not a new crop any longer, better genetics, herbicide tolerance, and hybrids have all significantly changed producers' management practices. Ongoing investment into developing on-farm processes for using these tools and understanding how to get the most production from them is necessary to improve producers' competitiveness and profitability. Research on management techniques is also necessary to ensure that Canadian canola is clearly recognized as being grown under environmentally sustainable cropping systems.
Our second area of recommendation is trade. The committee heard just last week from CAFTA, of which the Canola Council is a member, so we'll not spend a lot of time on this. But neither do we want to miss the opportunity to stress the importance of a comprehensive, multilateral agricultural trade agreement. The current Doha Round draft would result in substantial reductions in tariffs, elimination of export subsidies, and disciplines on trade-distorting support. We urge the committee to endorse the WTO negotiations, and we urge the government to lead efforts to conclude a deal.
Bilaterally, we urge the government to make improved trade relations with China a priority. China is a substantial and growing market for canola, but we face a competitive disadvantage on tariffs with U.S. soybeans. China, with its enormous population and increasing wealth, is an important market for Canadian agriculture generally. We ask the committee to recommend steps to improve our trade relations there.
We support plans for discussions on a new economic relationship with the European Community. Canola has essentially been barred from Europe by biotechnology regulations. It took 12 years to obtain the approvals for herbicide-tolerant canola. It took two years in all of our other export markets. A new relationship provides an opportunity to develop new solutions in this area.
We welcome the tabling of legislation to implement free trade deals with Peru and Colombia. These are very modest markets for canola, but a tariff-free environment provides the opportunity for growth.
Finally on trade, we welcome the announcement of a market access secretariat from Minister Ritz. We look forward to working with him on its further development. Technical barriers to trade are becoming more substantial roadblocks in the international marketplace. We agree that governments and industry in Canada need to improve their capability in this area.
Our number three recommendation is in the area of regulation. A subcommittee of this committee is looking into food safety issues, as are the federal and provincial ministers of agriculture, who've committed to coming forward with a food safety action plan. This is also an issue getting much attention south of the border.
Given our level of trade with the U.S. and the high quality of our food security and consumer protection systems on both sides of the border, we believe Canada should be working closely with U.S. regulators on any food safety action plan that is developed. Common approaches and shared science is better for both consumers and business rather than separate strategies and a thickening of the Canada-U.S. border when it comes to trade.
Our final recommendation surrounds biodiesel--the last time I had the opportunity to appear before this committee it was on that topic--and the development of the biodiesel sector in Canada. This is something the Parliament of Canada supported almost a year ago with Bill C-33, but it's being held up by the process of creating regulations. This will affect our competitiveness.
Regulations are required from Environment Canada to set the 2010 start date for the renewable fuels standard for both ethanol and biodiesel fuels to be blended into Canada's gasoline and diesel. The positive economic rural development and environmental benefits of building this market are well understood. In addition, much technical work and testing has been successfully completed. We only need to get the regulations passed in a timely manner. We urge the committee to recommend immediate action on this, before its final report on the current study.
In summary, competitiveness and what the government can do to improve competitiveness for canola growers and the industry are key to the continuing success of this important Canadian crop.
Thank you very much for your attention today. I look forward to any questions you may have.