Evidence of meeting #7 for Agriculture and Agri-Food in the 40th Parliament, 2nd session. (The original version is on Parliament’s site, as are the minutes.) The winning word was industry.
A recording is available from Parliament.
Conservative
Brian Storseth Conservative Westlock—St. Paul, AB
Thank you very much, Mr. Chair.
It's good to see some friends here again. I want to thank everybody for their excellent presentations, for taking the time to come out here, and Mr. Preugschas for talking to members on both sides of the aisle to make sure we get some resolution to these issues that are affecting us back home very dramatically.
Jurgen, you're from just outside my area; you know the family. In the hog business it's tough times right now, and we need to find some solutions going forward.
One of the things I find reassuring is that we now have an agriculture minister who's a straight shooter. He's out there right now doing consultations across the country—he was just in the chair's riding yesterday—talking to producers, listening to producers, listening to producers' concerns on the programs, on the path forward, some of the issues. The programs aren't perfect. The minister came here and said that, and said that they're willing to look at some of these programs.
I want to thank organizations and individuals such as you who take the time to help us fight the good fight on this. Mr. Orb helped me fight to keep costs down on some of our pesticides and chemicals last year, and it's important that we have this support when we take on the issues.
One thing, though, that really disturbs me is the continuous revisionist history that we get from the opposition. The member from Malpeque is the best at this. I'll read you a couple of things, and this comes from his recommendations:
That all governments place a priority on measures that will enhance farmers' economic returns from the marketplace.
—I emphasize “from the marketplace”—
That ministers and ministries of agriculture see their primary role as advocating on behalf of primary producers. That governments consult primary producers and their representatives in the design and review of farm support programs. That the Competition Bureau be restructured and instructed to review the impact of current and proposed consolidations--
—this is something that he votes for here at committee, but then says “It's not a priority, we'll look at it after I get my political views out of the way”—
That the Competition Act be strengthened so that the impact of corporate consolidation on the primary producer can be taken into account.
—something he votes for at committee and then refuses to make a priority going forward—
That governments work with primary producers to identify costs, such as inspection fees, that government can either reduce or pay for entirely, while remaining compliant with trade agreements.
Then he comes today and says well, don't worry about trade agreements, we have to fight for producers first. And we have lots more of this. A whole section on competitiveness--things that our minister has already done and already accomplished. These are all from the member from Malpeque's recommendations when he's in government, but the minute he gets out of government, then he can start railing for what he really believes in, apparently.
This is the kind of sanctimoniousness that we have to be aware of. We have to realize that when we have these discussions with farmers we have to be straightforward and honest with them about the direction we're going in. It's one of the things that I've always respected.
We had Carol Skelton on this committee last year—
Conservative
Brian Storseth Conservative Westlock—St. Paul, AB
—We've had James Bezan, David Anderson, Mr. Miller, Gerry Ritz on this committee. These are all people who advocated for one thing when they were in opposition and are advocating for the exact same thing when they are in government. It's nice to see some people that are willing to stand by their principles when they do get into government.
That's my rant for the day, and I've been listening to it for a while.
Mr. Orb, you talked about one thing that's been coming up time and time again, and I want you to take the time to extrapolate on it a little bit. It's about age verification and where you think the importance of that is going to be moving forward. When Premier Stelmach put that per-head payment out there to producers in Alberta, he tied it to the age verification issue. It wasn't very popular at the time, but it seems to be the direction we're getting from all across the country; it's the direction they want to go in.
Could you comment on that quickly?
Director, Board of Directors, Saskatchewan Association of Rural Municipalities
Yes, thanks, Brian.
In our submission, we said we think it's important that all Canadian producers age verify their beef because it does open up some international markets. I know there was a question from Mr. Atamanenko about the European Union. I think it pertains more to the Asian markets, particularly Japan, that producers are able to somehow track when animals are born and where they're born, and also this makes it easier for CFIA to track animals in Canada for problems such as BSE.
But I think Alberta has taken a good step there. They've put in about $300 million over two years, as you're aware. It wasn't particularly popular with producers, but I think that maybe 90% now have age verified their cattle or are in the process of it.
Saskatchewan has taken a different route, citing that it was unpopular with producers. They've done an ad hoc payment—Mr. Easter mentioned that—$40 per breeding cow. I think in the end Saskatchewan will be doing that. We're still lobbying them to promote this to cattle producers, because they think it has to be done.
It is the way to go, you're absolutely right.
Conservative
Brian Storseth Conservative Westlock—St. Paul, AB
As Premier Stelmach proved, sometimes it may not be popular when you give somebody an extra $40 or $50 a head to push the industry in a certain direction, but I think that is for the betterment of everybody. That is certainly something we've been hearing here. I appreciate your comments on that.
Mr. Preugschas, you mentioned the comprehensive free trade agreement with the European Union and how important it is for your organization and for the entire sector. I agree with you. Could you extrapolate on that a little bit?
At the same time, I would like to mention that we do have an opportunity today and I would encourage all members of Parliament to come to Room 112N in Centre Block at four o'clock. We have actually a delegation of the European Parliament international trade committee here to meet with members of Parliament. So I'm sure we'll see at least these 12 members of Parliament there lobbying to make sure the pork is included in the free trade agreement.
Could you take a couple of minutes to talk about how important that is for your industry and the direction that you see forward for our industry, particularly in Alberta? We were one of the cheapest regions in North America to produce pork. We're now labelled as one of the most expensive. Can you help us with the direction forward with that?
Conservative
Chair, Canadian Pork Council
I think regardless of which area of the world we're looking at, trade access is critical. As was mentioned, if we can't do it through the WTO, at least we need to do it through bilateral agreements, and a 5% access without tariffs would be huge for us in the European Union.
So it's critical. Any market is critical to us for the long-term sustainability.
Executive Director, Canadian Pork Council
I'll just say a few words in total.
We don't really sell pigs; we sell hams and we sell shoulders and bellies. It is all broken up, and the cut that is the most problematic for our industry in the world market is the ham. The European market for hams is the best in the world, particularly in the manufacturers in Italy and in the U.K., and interestingly also the very highest tariff going into the EU is the hams. Products that we could ship in there at low tariffs they don't really need.
So that's the big bonus if we can get another market. We shipped 50,000 tonnes of hams into Romania the year before they joined the EU. It's zero now. That's the way it has gone.
Conservative
Liberal
Judy Foote Liberal Random—Burin—St. George's, NL
Thank you, Mr. Chair.
Thank you to our witnesses for appearing before us today.
Having listened to you, I know clearly this is a serious situation for the industry. It's unfortunate that as witnesses from outside of the political realm you were just subjected to a political rant, as my colleague put it, on an occasion when we're here really to discuss the seriousness of this issue.
I was reading a letter here that you'd written to both ministers, dated February 23. It would appear in the letter that what's happening on March 16 is a foregone conclusion. I'm looking at this, and it says the final rule that was published in January will go into effect March 16. My question is, what's happened in the interim? What's happened leading up to this? We're talking about two weeks away, and you're here before the committee today. Have you been partnering with similar organizations in the U.S. to try to get this handled through the political realm there, or the government there?
Chair, Canadian Pork Council
Absolutely. We work very closely with the National Pork Producers Council on the hog side. They're as opposed to COOL as we are and always have been. But what has happened is that the Bush administration had put the final rule in place. Then when the Obama administration came in, they said they wanted to review it. This is where the uncertainty is now coming.
We can live with the final rule as presented. We cannot live with voluntary suggestions that Secretary Vilsack put on there. That's where the problem is.
Liberal
Judy Foote Liberal Random—Burin—St. George's, NL
Thank you for clarifying that for me.
In terms of the industry itself, if it's having such a dramatic negative impact in the U.S. as it is having here in Canada, what kind of response have you gotten from the Canadian government? Have you gotten a response from Ministers Day and Ritz to your letter of February 23?
Chair, Canadian Pork Council
No, there's no response as yet. We've had discussions with them, and the minister has been very good in terms of all the negotiations that were going on. We were quite informed and we were part of those discussions and suggestions on how to move forward; however, as yet, we have no response back from the ministers on this particular letter.
Liberal
Judy Foote Liberal Random—Burin—St. George's, NL
Pardon my ignorance, but it just seems as if it's the 11th hour—we're talking about March 16 when this is coming down the pipe.
Chair, Canadian Pork Council
We feel it needs to be addressed, as Martin stated. We need to go straight to the White House as quickly as possible.
Liberal
Judy Foote Liberal Random—Burin—St. George's, NL
Thank you.
Mark, do you want to pick up the rest of the time?
Liberal
Liberal
Mark Eyking Liberal Sydney—Victoria, NS
Thank you for coming, folks.
I'm from Nova Scotia. You probably know our president of Pork Nova Scotia, Gerald Vermeulen. He's one of the largest operators. He's got a very efficient operation, and he's ready to close his doors. You can see the drop in your numbers here. When you look at Nova Scotia and P.E.I. together, I think there's an over 50% drop on the year. Look at the hog numbers that are coming out. It's pretty well decimated down on the east coast.
What happens when these numbers start going down is that all of a sudden the plant is in jeopardy. We have that with the beef; we have only one plant. We have only one kill plant for the hogs. I guess my question to you is, what can governments or the association do? Mostly what we talk about is the trade and the bigger picture, and that helps everybody, but what can we do federally and provincially to help this industry from losing altogether in the Maritimes?
Chair, Canadian Pork Council
As I stated before, I think we have to throw everything on the table. I think we need to be creative. I don't know exactly what the answers are and what the right thing is, but we need to get as many heads together as possible to see how we can do this.
As I stated before, I believe there are more than 20,000 jobs in Canada in jeopardy here: primary producers, feed mills, truckers, packers, processors, all the way down the line. This is really a serious business. We need to do something fast and we all need to really take a serious look at what we can do. We thought we were going to recover. The economic situation in the world has slowed that down. We're in dire straits, and something has to be done immediately.
Conservative
The Chair Conservative Larry Miller
Thank you very much. Your time is up, Mr. Eyking.
Mr. Bellavance, you have five minutes. I'm sorry, I'm out of order. It's Mr. Lemieux.
Conservative
Pierre Lemieux Conservative Glengarry—Prescott—Russell, ON
That's okay, Chair. I know you were thinking of me. I wasn't going to raise a fuss.
Gentlemen, thank you for being here. There's no question that the pork industry is facing challenges today. One of the things I would like to do in my opening comments is underline some of the support government is giving to pork producers. You had already mentioned it, but I'll just mention it for my colleagues on the other side, because they forget this type of information. In 2007 and 2008, over $1 billion is projected to flow to livestock producers through these new BRM programs. That would include the AgriInvest kickstart payments. That's a thousand million dollars. It's significant money.
Of course, you mentioned the advanced payments program. Some $563 million has been advanced to cattle and hog producers in the 2008-09 production period and $406 million of this was in emergency advances. Of course, now there's the extension. There's significant money flowing, but in fact, this does not solve all the problems the hog industry is facing, and I acknowledge that. However, I did want to run through the numbers for my colleagues, because they do forget the work that's actually being done and the money that's actually being delivered on the ground.
One of the things both your organizations spoke about was the importance of international markets. I would like to pick up on that a little bit. Minister Ritz has been extremely busy internationally, opening these new markets. I believe Canada Pork International was in India with the minister. I wanted to ask you about the Indian market. Let me just ask you a few general questions.
One of them is this. How important is export, in your eyes, to the hog industry? Secondly, specifically about India, how do you measure that breakthrough in India? What do you see as the future for pork through this new market opportunity?
Executive Director, Canada Pork International
How important is it to our industry to export? Well, we are the most export dependent of all the large producers in the world—besides maybe Denmark, but Denmark is part of the European Union. The share of other countries, such as the U.S.... Their export share is, what, 15% or 20% of their total production? But keep in mind that 10% of their supply of hogs came from Canada.
India is the last frontier, the last big market to be opened besides the European Union. People will say there are no opportunities in India, that they don't eat pork or don't have pork. I wouldn't eat Indian pork either; it's not very safe. There are some quality controls they have to work on.
Some Canadian pork is already going into India, somehow. At the same time, the Indian authorities are determined to have only one set of import requirements. They don't want to approve the countries one by one or the plants one by one.
After three years of banging our heads on the Indian door, finally, after the visit of Minister Ritz, we were able to really understand what the Indians' preoccupations were. The Indian minister gave us some opening to there being negotiations we could go to in order to finally have access. We were not pleased with the conditions the Indian government had proposed at this time, but at least we were able to open the door.