Thank you, Mr. Chairman.
I am Brad Wildeman, president of the Canadian Cattlemen's Association. Thanks for the opportunity to appear here this afternoon to share our perspectives on the impact of the SRM regulations that came into effect in the summer of 2007.
In a nutshell, the cost of removing and disposing of SRM is one of the greatest threats to the long-term sustainability of the beef and cattle industry in Canada.
Since we compete in a North American cattle and beef market, it is not sustainable for the Canadian industry to incur costs that the U.S. does not. As long as this imbalance exists, a growing percentage of Canadian cattlemen will seek higher prices in U.S. slaughter facilities. We are already experiencing this movement, and we have seen many plants closed or bankrupted because of their inability to compete with our U.S. competitors. At the same time, a growing percentage of the beef offered by Canadian retailers and food services is now being imported from the U.S. and elsewhere.
In other words, we may have an extremely effective set of BSE eradication policies in Canada, but it really will be of little benefit to either the Canadian industry or Canadian consumers if Canadian beef is either not available or priced out of the domestic market.
Furthermore, the costs are the highest in the smallest federally and provincially inspected plants, resulting in a number of closures or decisions not to process these cattle that are over 30 months. These operations are critical to the local rural economy and offer a nearby outlet to sell cattle that cannot stand the rigours of long-distance transportation to market.
Our long-term hope, obviously, is that the Canadian and U.S. regulatory officials will be able to harmonize policies and costs within North America. Several positive actions, both from a trade and regulatory perspective, can be taken to lessen the variance between costs in Canada and the U.S. We are working with officials to achieve this harmonization, but clearly we're talking about years here. It's obvious that while the policy track works toward restoring a competitive balance, immediate financial assistance is vital.
Given the differences in marketing and processing cattle under 30 months versus cattle over 30 months, we believe different approaches are required for these two cattle populations.
For cattle under 30 months, we are working with government officials to identify an appropriate vehicle to provide the relief needed, but for today we would like to focus on the situation of those over 30 months, where we are seeking an immediate payment of $31.70 per head to be made to the abattoir, regardless of whether it is a federally or provincially inspected facility. For the cattle over 30 months, since dairy cattle are affected as well as beef cattle, we have come together with our colleagues, among them, Dairy Farmers of Canada and the Canadian Federation of Agriculture, to submit a joint request to Minister Ritz in a letter dated October 27, 2009--and I believe copies have been passed around.
This letter is self-explanatory, and my time is limited, so I will leave it for the question period if there any questions to be answered.
On another topic, I was also asked to update the committee on the country-of-origin labelling situation with the U.S. COOL continues to be a significant problem for livestock producers, if not so much on the meat side of the industry, certainly on the cattle side. The costs of handling Canadian versus U.S. cattle by U.S. feeders and packers has been researched and documented by the Canadian Cattlemen's Association and government officials working closely together. As these numbers are central to Canada's WTO case that will be proceeding, we are not willing to share those in a public forum at this time, if possible.
On that front, the Canadian and Mexican governments made their requests for WTO panels to be established on October 23 at the dispute settlement body. As expected, the U.S. exercised its right to block that appeal. We are expecting the Government of Canada will make a second request on November 19, and that panel will be established at that time.
From there, we expect an initial decision from WTO by late spring or early summer, and there is likely to be an appeal either way. We understand the appeal decision could come around the end of 2010 or 2011. Assuming it's in our favour, the U.S. would have to declare whether or not it intends to comply. If they do, there will be negotiations for some period of time as well, and if they don't, obviously we will hit on a retaliation path. We know this isn't a quick solution, but we believe it was the most prudent and only solution we had at that time.
With that, I'll turn the microphone over to you, Mr. Chair.
Thank you.