Thank you, Mr. Chairman.
Thank you, members of the committee, for the opportunity to be here today.
The Canadian Sheep Federation is a national non-profit organization that represents over 11,000 sheep producers. It has eight provincial members and three associate members: the Canadian Cooperative Wool Growers, the Canadian Sheep Breeders' Association, and the Canadian National Goat Federation.
The Canadian Sheep Federation did appear before the subcommittee on food safety and briefly brought up the issue of competitiveness then, particularly as it related to the need for Canadian producers to be price competitive. During that presentation it was noted that programs such as the food safe farm practices program and the Canadian sheep identification program have the potential to increase production costs for lamb producers, as they have limited options in terms of cost recovery. Additionally, the impetus for the development and implementation of these programs is often cited as public demand or public good. The ongoing costs of these programs can be quite burdensome and can represent a significant barrier, not only to on-farm profits, but also to the competitiveness of the small ruminant industry.
The small ruminant industry is recommending that federal and provincial governments commit to providing long-term funding for both traceability and on-farm food safety programming. The issue of competitiveness is quite complex and extends beyond both being price competitive and the cost of implementing various programs. The purpose today is to provide some insight into some of the issues that are impacting the Canadian sheep industry's ability to not only be competitive but also to meet its potential.
Since 2004 the sheep industry has seen its breeding flock shrink by 100,000 ewes, which has resulted in an 8% drop in the number of lambs processed in Canada. This is occurring at the same time when demand for lamb has increased by 10%. In fact, lamb is one of the only protein groups that is experiencing a consistent increase in demand. The Canadian sheep industry could double its production and still not meet the current demand. The question is this. Why are Canadian shepherds not increasing their productivity? The reality is that encouraging producers to increase their production becomes an uphill battle when they are faced with issues such as predation, an inability to access medication and vaccines, a border that remains closed, and rising input costs.
Predation is a major deterrent to the growth of the Canadian sheep industry and is a contributing factor to the ongoing attrition of Canadian sheep farmers. Predators are responsible for the devastating loss of valuable livestock and farm income. For example, one Saskatchewan farmer has lost 150 lambs this year alone to predators, worth a total of $30,000. The cost of predation is high for provincial governments as well. In 2007 the Alberta government paid out close to $1 million on predation claims, while the Saskatchewan government paid out over $600,000. In 2008 the Ontario government paid out $1.33 million to producers of all livestock due to predation.
The industry is holding a meeting on predation on November 9 in Toronto, and the goal of the meeting is to start a discussion with provincial governments on the need to address the issue of predation, what tools producers are currently using, and how we can expand the number of tools available. We are, however, experiencing difficulty in getting the people who need to participate to be there. Considering that predation falls under provincial jurisdiction, it's important that provincial representatives, not only from the ministries of agriculture but also from natural resources and the environment, are present. However, many provincial governments have suspended funding for travel, and Agriculture and Agri-Food Canada cannot cover the travel costs for provincial employees. The result is that the outcome of the meeting may be compromised because not all parties are present. The issue of predation, especially in terms of mitigation, needs to be addressed at both national and provincial levels and across ministries. Therefore, it is recommended that government policies be flexible enough to mobilize the people and resources needed to address an issue that is impacting producers, particularly an issue that is directly linked to producers leaving an industry.
The lack of availability of pharmaceutical drugs and vaccine is disadvantaging the small ruminant industry compared to other livestock commodities in Canada and compared to other major lamb exporting countries such as New Zealand. The lack of licensed pharmaceuticals and vaccines for the treatment and prevention of disease in small ruminants is of grave concern to the industry, not only in terms of its ability to increase production and to remain competitive, but also to meet the requirements of the food safe farm practices program. For example, one of the core requirements of the program is that all drugs used on sheep must have a drug identification number, meaning that the drug has been approved for use in Canada by the Canadian veterinary directorate. Frustratingly, though, drugs that are commonly used in other sheep-rearing countries are not available in Canada, even through the proviso “own use importation”. An example of this is moxidectin, which is a sheep drench used to control internal parasites. It is available around the world but not in Canada.
The VDD has instituted a minor use, minor species approval track to help this problem, but it's currently in its infancy and no drugs have yet to come through the program. A similar program to have vaccines approved through the Canadian Food Inspection Agency is also required.
Earlier, it was mentioned that the Canadian breeding flock has shrunk by 100,000 ewes since 2004. It is worth mentioning that the industry was in the midst of a real growth phase until the border closed, and since then the industry has been contracting.
Prior to 2003, trade in market lambs to the U.S. represented as much as 20% of our annual production. The border closure also meant the loss of very significant markets for breeding stock into the U.S. and Mexico. Prior to the border closure, importers from the aforementioned countries were intensely interested in Canadian genetics. In 2002, the small ruminants exported from Canada totalled $12.5 million, a value that was expected to increase 71% in 2003.
Over the past six years the Canadian small ruminant industry has been working diligently to regain access to the U.S. and Mexican markets. Together with the CFIA, the industry has implemented the voluntary flock scrapie certification program and the national scrapie genotyping program. The implementation of scrapie eradication programs is key to helping ensure that the small ruminant industry is able to re-access its markets.
While the CFIA has announced its commitment to a national active scrapie surveillance program, the industry has yet to be able to access long-term funding for surveillance as well as funding to determine the prevalence of scrapie in Canada. Determining its prevalence is extremely important so that the industry is able to set a target eradication date.
The U.S. has invested $120 million in scrapie eradication since 2001 and has declared that their country will be scrapie free by 2017. Canada must take similar strides. If we do not, we risk not being able to re-access the U.S. and Mexican markets. Additionally, we also risk losing markets that we have recently gained, for example Russia, because the U.S. will be a major threat on the international scene due to their scrapie-free status.
It is critical that policy on importation and exportation be based on science, and that when a border remains closed for six years, the Canadian government actively assist and lobby to open it again. We are asking that the same effort that has been given to the other livestock commodity groups be put in to helping the small ruminant industries regain the U.S. market.
Canadian shepherds are also facing increasing costs of production. For example, it has been reported that this year producers are dealing with feed costs that are approximately 25% higher than they were last year. Couple this with high land costs, low value of and returns on food production due to long-term cheap food policies, and the loss of access to labour and support resources and the potential result is the loss of critical mass in the national flock due to low margins. This is seriously jeopardizing production and industry infrastructure.
There is a need for a strategy designed specifically to address these issues so that the sheep industry can both keep existing producers and attract new ones.
There is real potential for growth in the Canadian sheep industry. This is an industry that can expand its production without negatively impacting any other livestock commodity. To do this, though, the small ruminant industry needs the government to assist in dealing with key issues such as traceability, food safety, wildlife damage, animal health, market access, and long-term sustainability of producers involved in animal-based agriculture.
Thank you.