Sure. Thanks, Alex.
Certainly, I called them “sensitive products” for a reason. The apple industry has looked long and hard at what supply management has. When you have an element of certainty around your cost structure and then around your revenue, that looks very attractive.
We had a chance--this goes back to the mid-eighties--when the Canadian apple industry did vote to set up a supply management or a marketing scheme. Ontario, oddly enough, turned it down. They've regretted it ever since.
So we've already had some initial national discussions on it. And the idea would be to treat apples with the same broad brush stroke as any other supply management commodity. Granted, it would work a little differently, though, because we cannot supply the needs of the Canadian apple industry. As a whole, Canadian apple growers produce probably 50% of Canada's needs, so we're going to be a net importer regardless.
It would allow us, though, to have that first point of entry control of regulation on imports so we could have a reference price for imported product without calling it a tariff. And we could have some sort of regulation of that product such that we in turn can effectively sell our product in an orderly fashion and at the same time, I hope, have a little bit more market power. We've lost considerable market power. We have no market power any longer with the consolidated retailers. So it would be an effort to rectify some of that.
I don't know if any of you have heard this before, but I heard a marketing expert this March at the Canadian Horticultural Council in Quebec City. I asked the question of one speaker beforehand, and this expert confirmed my suspicions. I asked the specific question: during this time of recession, what has happened with wholesale and retail margins in the fresh vegetable and fruit sectors?
The retail margins have increased--at a time when producers are getting less.
That is despicable. That should not happen.
Hence our industry's frustration, and hence the industry saying that perhaps we have to go down this road and consider some kind of special protection for the industry, because we really don't see things improving in terms of our empowerment with the retail sector and in terms of the free and open access that U.S. and other competitors have into our market because of NAFTA and other trade agreements.
So that's where we're coming from. I'm not saying that's the be-all and end-all or the solution. We are looking at things like perhaps trying to pursue an anti-dump and get five years worth of protection. I can tell you that system is also very expensive and very archaic. Industry has to put up a lot of up-front money without any assurance we'll win our case.
Just ask the potato people. They went through a case very recently to renew their five-year protection, and it cost them in excess of $300,000. That was going to be their legal bill to take it to the CITT.
This is some of the reason behind our push for the concept of creating more sensitive product categories.