Agriculture Committee on May 11th, 2010

[Bob Woods, As an Individual]

Thank you.

I am Bob Woods, as you said, and I operate a dairy farm in Nauwigewauk, which is about halfway between here and Saint John. I came home several years ago, after going to agricultural college, and I've been farming with my parents ever since. They're still quite involved with the farm today. When I came home, we were milking about 30 cows, and we've grown our operation to presently milking 130-some cows.

We live in an area that is about 20 minutes outside of Saint John. Real estate pressures are pretty severe in our area. We used to use the farm property next door to us, and my father had used it for about 30 years before I came home. My frustration is that I now see it growing up with houses, and I see all the topsoil stripped off it.

As well, when I was a young fellow at home, and even when I was first home for a few years, I helped plough that land and seed it and fertilize it and spread manure. This is one of my greatest frustrations. It's very hard to see, and it's going on all around me. I know I'm in an area that's close to a city. As Jim said, you can't compete with $30,000-an-acre pricing on land.

I have a couple of other points. I've been around for a little while, a little longer than some of these guys. There used to be more government extension workers in our area, and I miss them. Some of them were quite helpful. The dairy nutritionist was particularly helpful any time you ran into trouble with cattle.

I think there is room for more government assistance with these extension workers. As we grew our farm, there were many times when I wished I had more people to talk to who were completely unbiased. Most of the people I had to talk to were people I had to do business with, and they all had their hands out trying to get some money. I wish there had been people who could have come in to help me analyze my expansion plans and my growth. Were they unbiased, I would have had more confidence in them.

Some of the government programs that have come to us have been good programs. There have been programs for manure storage, land clearing, and adding lime to land. My biggest frustration with them is that as I was growing and had my own plan in order, if my plans didn't coincide with what the program was at the time, sometimes it wasn't convenient for me to change my plans. Going down the road, I would like to see some of these programs active for several years so you would have more years to make your own financial planning around them, to enable you to participate in each of these programs. Sometimes we've only had as little as a couple of months' notice to get our name in on some of these programs, and sometimes the lack of funding to these programs meant that in our province only five or six people were able to use up that money before it was gone, so there were several who didn't get to use it.

Another thing that I think might be something to look at for farmers, going down the road, is programs that aren't specific to certain areas of farming but maybe would buy down interest, or some zero-interest programs that could help a farmer plan ahead. He would only be accountable for the principal, but the interest could be somehow looked after by the government in the form of a grant or buy-back, I'm not sure.

Anyway, as I was getting ready to come here this morning, I was kind of wishing I hadn't said I would come and talk. I had a lot to do. I was rushing and busy, as I'm sure everybody else was here this morning. Then I thought maybe this is the best place I can spend my time this morning, and maybe people will listen and understand a few of my frustrations, as well as those of some of the others. There is a problem. There are diminishing profits. I see the difference. I've been home long enough to see the difference.

I'm glad to see you all here today, and I appreciate it.

Thank you.

[The Chair, Conservative, Larry Miller]

Thank you, Bob. We're glad you did decide to come, because it's important to hear from young people such as yourself. Thank you.

Mr. Godbout and Ms. McTiernan, from Atlantic Grains Council, for seven minutes or less, please.

[Robert Godbout, Director, Atlantic Grains Council]

Good morning, Mr. Chairman, members of Parliament, and fellow guests. My name is Robert Godbout. I'm a grain and oilseeds producer from Grand Falls, New Brunswick. I'm also the director of the Atlantic Grains Council. With me today is Monique McTiernan, our executive director.

First, I would like to thank you for the opportunity to be here today and to share our thoughts with you on the future of farming and young farmers.

As you can see, I do not quite fit this category. The reason I'm presenting is that there are few young farmers to be found in the grain and oilseeds sector and this is probably one of the busiest times of the year for producers.

Since incorporation in 1984, the Atlantic Grains Council has been the only regional voice representing grain and oilseeds producers on a regional and national basis. Membership consists of five full members and eight associate members, representing grain and oilseeds producers, processors, handlers, traders, input suppliers, and researchers.

The council has a very active research foundation. It is a founding member of the Grain Growers of Canada and a voting member of the Canadian Grain Commission eastern standards committee.

Issues need to be addressed to ensure that young farmers will have a future in the grain and oilseeds sector. Following a written request to Minister Ritz in September 2009 seeking funding solutions for cultivar research for the region, a reply from the minister was received by our chairman, Allan Ling, on November 18, 2009, stating that the Atlantic Grains Council could also apply for funding under the Growing Canadian Agri-Innovations program, through the Canadian Agri-Science Clusters initiative, or through the Developing Innovative Agri-Products initiative.

Following this encouraging advice from the minister, the council, with seven partners and three provincial governments, and support across the eastern Canada region, Ontario east, formed a coalition and submitted a cluster proposal in December 2009, looking at increasing the economic impact of the canola and soybean industries in eastern Canada for producers and processors. This would be accomplished by helping to obtain germplasm to address the need to improve functional foods' agronomic value; develop techniques to simplify breeding and selection for large populations; evaluate new lines of short-season varieties; and implement new value-added GM and non-GM oilseed food products.

This was a $9.6-million project involving AFC breeders, with $2.5 million committed by the private sector. The Eastern Canada Oilseeds Development Alliance Inc. was very disappointed to receive a letter from Dr. Johnston, director of the innovation directorate of Agriculture and Agri-Food Canada, on April 12, informing that the eastern Canada oilseeds development cluster was not approved.

The council is wondering why eastern Canada has been shut out of the cluster program. We have pretty well lost our livestock industry and are trying to find alternative crops to grow. The new crops will need to rotate well with potatoes, and this cluster would have looked at that issue. If one of their reasons is too many applicants and lack of funding, I think it demonstrates the need for more research. A second round of projects and funding should be initiated.

Agriculture and Agri-Food Canada has played an immense role in the development of agriculture in this region and for the past century has been the key research institute in the region, having small grain and oilseeds work done at four research stations in the region, but we have seen an erosion of this service, going from 28 research scientists to five. At the moment, the only research station doing any cereal and oilseed work is in Charlottetown, and there is only one scientist in the region. This erosion cannot continue.

Since 1994 we have seen a drop of over 40% in government funding for research in grain and oilseeds. We are a small region with a very specific maritime climate. Varieties that may do well in the west, or even in Quebec and Ontario, may not do well or may become more disease-susceptible here. Your policy must support public research—more specifically, A-based funding of AgCanada research stations and scientists in the grain and oilseeds sector to ensure that the region has varieties that will thrive in our region so that farmers can continue growing grain and oilseeds profitably.

Without long-term research goals, our young farmers may not continue to farm. An investment in research is an investment in youth.

The disease fusarium head blight thrives very well in our cold, moist climate and has the potential to destroy our small grains industry in the Maritimes if not brought under control. The region is in the fourth year of an epidemic level. Unfortunately, we have the 3-Ac-DON, or 3-acetyl-deoxynivalenol, which produces higher levels than the 15-ac-DON found in western Canada.

Long term, it would be controlled by having resistant varieties, but we all know the length of time required to breed varieties. All new work needs to be considered as part of the important frontal attack. Education is another avenue that must be addressed.

Without viable cereal grains options, again, our young people are reluctant to farm.

Our infrastructure used to be updated. With grain prices having been low for such a long period of time, the producers have been unable to upgrade their facilities. Upgrading will allow producers to not only properly condition and store their products but to participate in new value-added opportunities.

The council had the opportunity to meet with Minister Ritz in Halifax in February 2009. He informed the council that infrastructure funding was available, but we are still wondering how to access these funds.

In conclusion, the council feels that there is a future for young farmers in the region, but things need to change. On the plus side, we would like to acknowledge the support young farmers from across Canada receive from the Canadian Young Farmers' Forum. This is an excellent organization that gives young farmers the opportunity to connect several times a year to discuss issues of policy and share information.

First, our youth need to see a firm commitment on public research that deals with some of our key agronomic problems. We are a feed-deficient region of Canada, yet we have the potential to do so much more.

Second, they need to see safety nets that work, especially in the beginning years of a farming career, when one doesn't have the resources or capital to withstand a bad year.

Third, they want to see a vision of commitment from the federal government so that they can commit their lives to this industry. The government will be their partner for the long term.

The planting farmers are innovative and entrepreneurial. They do not believe government owes them a living, but they do believe the government owes them a policy and regulatory environment in which they can make an honest living, which does not include selling crops below the cost of production. Our youth need a reason to farm, and they are hopeful that your commitment will make a solid recommendation that encourages them to do so.

Thank you for the opportunity to be here today and for allowing us to share our concerns. We look forward to your questions.

[The Chair, Conservative, Larry Miller]

Thank you very much, Mr. Godbout.

We'll now move to questioning.

Mr. Eyking, you have five minutes.

[Mark Eyking, Liberal, Sydney—Victoria, NS]

Thank you, Mr. Chair.

I thank the witnesses for coming here this morning. Some of you had other things you could have been doing, but it's very important that you came in to talk to us, because hopefully, after our report, we'll make some recommendations to government.

For the first round of witnesses we had this morning, it was mostly supply management. We heard how well they're doing, or...in the future that should stay there. But I think the panel here is mostly from beef and grain, and I also want to talk about the hogs. In the Maritimes, those three industries seem to be in quite a bit of difficulty.

On the beef issue, I mentioned to the other witnesses that we're probably not going to have supply management or marketing boards for beef, but we had a situation out in British Columbia with the orchard growers. Cheap fruit was coming in and causing them to have a lot of difficulty. They talked about a floor price, a price that shouldn't go below a certain price. Maybe that's something that should be dealt with. Instead of the government of the day having to subsidize to get up to a price, maybe there should be a floor price or a minimum price that processors should be paying for a product. It may be something that some of these commodities should be looking into.

The other thing is the grain industry. In the Maritimes, there's a lot of mixed farming, and one commodity relies on the other. My question deals with the grain farmers. We know that potatoes are a big industry in the Maritimes, but they use barley as a rotation crop, and one of the big consumers of barley is hogs. How is the whole grain industry going to go if the beef and the hogs kind of go by the wayside and the processing plants and so on go down? Where are you going to sell your grain if those two industries do not succeed?

I have another question about the Grains Council when you're finished.

[Robert Godbout]

Well, it's been a challenge. I had the comment from the dairy farmers just a while ago that grain prices are very high, which I was surprised to hear, because we're still selling below 1982 prices.

We're only 45% self-sufficient, and my concern is that if we don't stabilize the system, we're going to lose more grain producers. Potatoes were subsidizing the rotation for a time, because potatoes were making money. Even though they lost money on the grain, they were still putting it in for the rotation. That's no longer the case. They're losing money on potatoes and they're losing money on grain. So now they're actually weighing what they need to do, and a lot of them this year have opted to just put grass seed in the ground. That's not going to help the beef or the red meat industry.

[Mark Eyking, Liberal, Sydney—Victoria, NS]

It sounds like the perfect storm happening with the grain industry.

Yesterday it was brought up to us in Quebec about the cutting of the funding to the grain council in eastern Canada. I'm trying to figure out why this is happening, because when we look at the agricultural budgets, the estimates, in Ottawa, they are staying quite the same.

I'm trying to figure out why the minister, if he met with your group.... You know, especially with Atlantic Canada and climate change, some crops are going to have problems, some crops are going to have opportunities. I think if there is a time for more research, it is now for Atlantic Canada, in terms of different crops and how we do it.

How do you see that? Is this a more important time for research? Could it be a determining factor as to whether we're going to have a grain industry at all?

[Robert Godbout]

I agree with you 100% that we need to get the research going. As I said, it has been depleted over the years. Unless we do that now, we're going to lose the grain industry, as far as I see it.

[Mark Eyking, Liberal, Sydney—Victoria, NS]

You're working together with Quebec and Ontario grain growers on this overall funding, aren't you?

[Robert Godbout]

On the clusters, I'll let you talk to the executive who look after that program.

[Monique McTiernan, Executive Director, Atlantic Grains Council]

We're a little disappointed about moving the clusters. This is the time that we're losing our livestock industry and losing that market, so we need alternative crops. That's why we're depending on these clusters to help us move the industry forward. Without the clusters we have no research and no research money. We're all not-for-profit organizations and we don't have deep pockets here. That's why we're depending a lot on clusters to help us move things forward.

[The Chair, Conservative, Larry Miller]

Mark, there are just a few seconds left.

[Mark Eyking, Liberal, Sydney—Victoria, NS]

Okay.

Well, we'll hopefully bring that to the minister's attention. I don't know if we have to do a better selling job. You've already talked to the minister about it, so we'll push on that issue.

I'm really concerned about the processing of the pork and the beef. If we don't have enough volume, it will be like a domino effect. I don't want to talk all doom and gloom here today, but I think we're at a turning point with those industries. Grain, beef, pork, and potatoes are all intertwining in the Maritimes, and I think we have to look at that overall.

[Monique McTiernan]

As I say, we do have some good opportunities. We have that nice little niche market of soybeans going to Japan and other different areas. Everything is not doom and gloom.

[Mark Eyking, Liberal, Sydney—Victoria, NS]

So we have to look at those opportunities and we need some government help to tweak it or create an environment.

[The Chair, Conservative, Larry Miller]

Ms. Bonsant, for five minutes.

[France Bonsant, Bloc, Compton—Stanstead, QC]

Good morning.

I have not been out west, but I have been in Ontario and Quebec, and now here. No one has mentioned the agristability program. I would like to know whether it would help you deal with this crisis if the government improved the program.

[Bob Woods]

I'm sorry, I missed the question.

[France Bonsant, Bloc, Compton—Stanstead, QC]

AgriStability is a bit of an outdated government program. I would like to know what you think of it and how you think it could be improved to help you survive the crisis.

[Bob Woods]

That's a good question. We've been enrolled in the program...NISA, is it? I don't completely understand it, but there seems to be very few dollars channelled back through to us. This is one of my issues; there hasn't been enough money channelled back through to the farmers.

I'm not sure what we can do to tweak the programs so more money gets channelled into farmers' hands. I like the idea for the beef, with the floor price. I think that's a good idea. With the dairy industry we pretty much know what our milk cheque is. Our income is reasonably fixed because of our quota prices, except for the milk that goes into special classes. The sales go up and down a bit, which affect our prices. Our costs and our input seem to be where we have the most ability to make, or in some cases lose, money. I guess I'm looking for more control over cost in that area.

[Nathan Phinney]

I'd like to comment on the AgriStability. We have been involved with the CAIS program and the NISA program and the AgriStability program, but we find one of the complications is that we don't get true market value for our product. It is around the 70% to 80% mark. What we get from that stability program isn't what we should be getting; the product price should be higher in those programs.

[France Bonsant, Bloc, Compton—Stanstead, QC]

I noticed that the government would take a year or two to change up the programs by doing some cut and paste and that afterwards, it would give you just two or three weeks to figure it all out. That is not unique to agriculture. It happens almost everywhere. I know because we work with all the programs. After taking years to change wording, the government does not give you any time to respond properly. Many of you have missed out on this funding. Sometimes, there is not much of it. I want to know what you think of this trick?

[Nathan Phinney]

I'm just trying to think how I'm going to answer this.

I think the AgriStability programs have helped. They have obviously kept farms from foreclosing or going bankrupt. Yes, we are behind, and there is a cluster. Some of the programs are so hard to read and get into that farmers just get frustrated and sometimes give up on them.

However, I believe that we shouldn't, as farmers, be relying on these programs to keep us afloat or to try to help us. We should have these floor prices or fair market value, and then we wouldn't need it. They wouldn't be necessary. It would almost be like a crop insurance. That's what it would be in case something did crash, or there was a crisis. Then they'd be there to help us.

Half the problem with our industry is that for so long we have relied on these to carry us that we've just continually snowballed, and we're at a point now where it's either just going to collapse or we have to do something beyond this to the industry to improve it.

[The Chair, Conservative, Larry Miller]

Your time is up.

Mr. Allen, you have five minutes.

[Malcolm Allen, NDP, Welland, ON]

Thank you, Mr. Chair.

To Mr. Godbout, you talked about federal research programs and the fact that you see a reduction in these things. In Ontario, when we toured the University of Guelph, we saw a great many research projects being undertaken, the vast majority in partnership with major manufacturers. I'll call them that because they're really agribusinesses that are in the manufacturing business. They use all the terminology these days of manufacturers--I come out of the manufacturing centre--and they use all the buzzwords that have been used for the last 20 to 25 years, “value-added” being one of them, by the way, which is an old manufacturing term from the 1985 era.

Nonetheless, what would you like to see in real terms--I don't know if you can put a dollar figure to it, or a percentage--that we would see applied to agricultural colleges and universities and federal research departments? The agriculture department used to have a research department that was quite flourishing, but isn't so much anymore. We would actually get pure research, if you will, pure science, that then could be utilized by the broad base rather than proprietary science, which really is what happens when you have an amalgam of this corporation or that corporation in the agricultural field, which then will sell it to you versus it being done as a national piece that's then shared.

What would you like to see from that perspective, one way or the other? It may be less, it may be more; I'm not sure.