Agriculture Committee on May 12th, 2010

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

We're having quite the start this morning. I appreciate everybody's frankness.

My family has a farm in Cape Breton and my brothers had supply management and I was in the vegetable business, so I've seen both sides of it and the advantages of supply management. But there are some problems in supply management. We're hearing that across the country--not as much as return on investment, but more so on young people getting into it. I think the marketing boards seem to be coming to grips with that. They have to step up to the plate. I think you're going to see some changes in the marketing board system, because they need young people coming in.

I'd like to pick up where Peter is on the apple situation. Touring across this country, we were in the Okanagan Valley and we were hearing the same thing from the orchard people there. I'm sure it's the same in the valley. It would be a lot cheaper for you or a lot more financially advisable just to sell your orchard to somebody out of Halifax and they put a few horses out there. That's what's happening in the Okanagan Valley. But they're getting the cheap apples from the States.

I think it's about time for the tree fruit industry to have some sort of supply management--at the very least, a floor price of some sort. It's going to be a shame: once we lose all those orchards, they'll never come back. The land will be used for something else.

So I think the will is there across the country, but the producers have to sit down and put it on the table. I think that needs to be done.

We also heard about provincial programs. I was surprised to hear that a lot of farmers wanted money to be going back to the provinces or the federal money being spent by the provinces. It's similar to what we do in health care: you say okay, the federal government gives the provinces money, but we expect certain criteria.

There's no doubt there is a big difference between Quebec and many of the provinces. That's why Quebec is successful and that's why they have younger farmers.

If the federal government did a system where they give the provincial governments more money, would we be pushing for more of a maritime approach to this, or would you suggest that we go with individual provinces coming out with programs? I think Patricia alluded to this, that programs should be different here from in Saskatchewan or whatever. I just wanted to go into that. What kinds of programs would you like to see if there were more money coming from the federal to the provincial? How should that be doled out?

[Curtis Moxsom]

Individual provinces?

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

Yes, and would it be more to debt reduction, loans, programs, expansion? Where would you want to see that?

[Curtis Moxsom]

On programs and debt reduction, on the interest.

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

That would be your solution.

[Curtis Moxsom]

Yes.

[Cammie Harbottle]

In whatever that would be, I think the committee or the government would need to be mindful of the different scale of farming in different regions so that these would be targeted to smaller-scale farmers.

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

Yes, because we're seeing two different types of farmers evolving in the country: the commercial ones, and I can mention many other ones. We saw pork groups yesterday, but we also see the niche farmers. We saw many of those farmers here yesterday. So I think you would look at two different approaches to this.

Your comments, Patricia?

[Patricia Bishop]

Well, I certainly think it needs to be regional. I guess I don't know. I don't know the answer. Definitely debt reduction is huge. Opportunities for investing in green infrastructure are really important.

Peter is right. When there is no money to invest but you really want to get to that place, how do you do it? Once again I come back to the profitability and marketplace dollars. Unless we get the money to be able to invest in those things, we're not going to be able to get there.

But I think it's best that the money is given regionally, and I think that regions need to decide how that needs to be distributed. We need to go back to a model where communities, groups of people in that region, make decisions about what is best for them. We are different from other places, and those other places need to be able to make decisions about how the money would be best spent in their region.

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

There is another program we're seeing across the country in different provinces, and it's green technologies. It's really big. We were at farms in Ontario, and we saw a lot of outstanding young farmers where their other income is from green technology. Is there enough here in the province of Nova Scotia to have incentives for young farmers, or any farmers, to get into green technology?

[Patricia Bishop]

Absolutely. I think there is a lot of creativity and a lot of willingness to do things, especially around green technology. It's a matter of being able to put that into your mind and go with it, or to be able to access a fund or some sort of support system to take it off.

I am not an expert in these areas. There are people sitting right behind us who probably have more to say about that because they're probably more into it. But definitely there is a lot of willingness.

[The Chair, Conservative, Larry Miller]

Thank you very much.

I'll move to Mr. Hoback, for five minutes.

[Randy Hoback, Conservative, Prince Albert, SK]

Thank you, Chair.

First of all, you all did an excellent job today. We really appreciate your taking time out of your busy schedules to come here.

I have a couple of questions.

It's interesting that as we go across the country--I'm a farmer in Saskatchewan--there's one thing I've noticed as I've travelled throughout Canada or throughout the world. I used to work for a company where I was the marketing manager for seeding equipment in eastern and western Europe. Farmers are farmers, and they love to talk about farming. It just amazes me.

One thing I always find interesting is the definition of a family farm. Where I'm going with this is that we had an agriculture committee in Lanigan, Saskatchewan, and there was one farmer whose family farm was 24,000 acres. So how would you define a family farm? Again, quickly.

[Patricia Bishop]

There are multiple definitions of a family farm, but basically I would say a family farm is a family, like a mother and a father and children. And some family farms are getting bigger, and some family farms are staying smaller. Some family farms have thousands of acres and millions of dollars of activity, while others have $24,000 income and that's what they're happy with, and they're doing well.

[Randy Hoback, Conservative, Prince Albert, SK]

Would you all agree with that?

[Peter Elderkin]

Oh, absolutely. I feel that the 24,000-acre farm is still a family farm if it's run by a family. If it's a corporate entity that's owned by family members, it's a family farm. If it's a corporate entity that's owned by corporation X and 27,000 shareholders, it's not a family farm.

It is not up to us to guarantee a return on investment to corporate farms. We need to be concentrating on the family farm and to work on that.

[Randy Hoback, Conservative, Prince Albert, SK]

Okay. I want to advance from that. One of the things that was suggested in the meeting in Lanigan, which I'm referring to, are the types of programs that would help the young farmer get started, some sort of ability to make sure, for example, that the first five years they've got proper insurance in place.

One of the problems I see with loans and programs is how you keep them from becoming capitalized in the purchase price. How do I take a program and say we'll start a young farmers program and we'll give you $200,000 interest-free? Peter, how do I know that you're not going to jack your price up by another $200,000 because you know they've got the money? That's one of the questions.

I'm looking for solutions that would help you get started, that would get you going but wouldn't be capitalized in the purchase price. There were suggestions brought out that maybe when you're age 65 you don't get farm programs any more and if you're in the first five years of farming you get 150% of the farm programs.

Any ideas on that?

[Peter Elderkin]

I think it's as I said. I'm certainly willing to give my farm to my kids. When you give it away... I need security and they need security. In exchange for security, are we willing to give something up? Absolutely, some of us are. Some of us may not be. We are definitely willing to do this. And this moves on; this is the thing. If people are out there to look at this type of thing, I think we have to encourage this type of thing. And this works only with family farms, generally.

I've heard of situations in which people own cottage properties, and as long as they keep the cottage up, they keep it. Somebody has given it to them, and they maintain it, but when they're done with it they give it to somebody else who wants it. This certainly isn't common, but we need to have something.

We need to have incentives, as in debt reduction for transition of farms, income stabilization—this type of thing. It is a major problem. We do not want to capitalize it. We do not want to put—

[Randy Hoback, Conservative, Prince Albert, SK]

I'm going to cut you off there, Peter.

I want to listen to you, Erica, because you have a unique situation. You're trying to get into it. I can see the passion in your eyes. That's what it takes to get into this industry now. How could we help you without creating the other problem?

[Erica Versteeg]

We don't mind seeking outside investment, which I think the industry needs. But we need to have something to offer our investors without having to give up a big share of ownership of the farm. We still want to be the main shareholder. Basically, if we're trying to balance outside investment and purchase price, we're still going to negotiate hard for that bottom dollar, because the more outside investment we seek, the more—

[Randy Hoback, Conservative, Prince Albert, SK]

What is driving up that purchase price? Obviously, we're saying that the market won't return the revenues to pay off the loan. So why is the value so high? Why isn't it reflected in what's payable?

[Erica Versteeg]

Why is the value so high of a farm?

[Randy Hoback, Conservative, Prince Albert, SK]

Well, are you competing against housing? Why is that piece of land valued at $4,000 an acre when it can only produce $100 an acre in revenue? I guess what I'm trying to figure out is how the price became inflated so high.

[Erica Versteeg]

In the dairy industry, it's the price of quota. It's unfortunate, but... I believe it's a good system and I don't want to part with it, but...

[Randy Hoback, Conservative, Prince Albert, SK]

No, that's fair.