Agriculture Committee on June 2nd, 2010

[Alex Atamanenko, NDP, British Columbia Southern Interior, BC]

It would have been huge anyway.

[Pierre Lemieux, Conservative, Glengarry—Prescott—Russell, ON]

No, it wouldn't have been huge anyway, Alex. That's not true.

[The Chair, Conservative, Larry Miller]

There's a point of order.

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

I would recommend that the parliamentary secretary give the witness some breathing room on the answers.

[Pierre Lemieux, Conservative, Glengarry—Prescott—Russell, ON]

Time is limited, Chair.

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

Well, use it on another round or through one of your other members, but stop berating the witness.

[The Chair, Conservative, Larry Miller]

It's not a point of order.

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

Sure it is.

[Pierre Lemieux, Conservative, Glengarry—Prescott—Russell, ON]

All right. I have one last question, Chair.

Alex, on WTO and NAFTA, under those agreements in which we operate in terms of the sale of agricultural products and produce to other countries, they stipulate that we must make our decisions based on sound science. If we start making decisions based on something else, we'd be in contravention of NAFTA and WTO. How would you handle that? What about the impact it would have on our market?

[Alex Atamanenko, NDP, British Columbia Southern Interior, BC]

According to the analysis we have from the Library of Parliament, it should not present a problem.

Once again we have the example of Argentina, which is a world exporter of soy, and as far as I know there have not been any challenges to them in their business.

[The Chair, Conservative, Larry Miller]

Okay. Your time has expired.

So as per the agreement beforehand, I'd now ask that our scheduled witnesses please come—

[Wayne Easter, Liberal, Malpeque, PE]

There are other questions, Mr. Chair.

[The Chair, Conservative, Larry Miller]

Well, the agreement was that we would bring the witnesses up, but Alex would still answer any questions directly for him.

If you want it different, direct me otherwise. But he has agreed to answer any questions we have right to the end.

I'll ask our witnesses to please join the table.

Members, while that is happening—it'll take a minute—we have a housekeeping item here. It's just a budget that allows us to basically pay the expenses of the witnesses, to do the GMO study, and it's in front of you for an amount of $38,650.

If there are no questions, I'd entertain a motion to adopt that.

Yes.

[Wayne Easter, Liberal, Malpeque, PE]

Larry, this budget doesn't deny us the right to add some witnesses to the list, does it?

[The Chair, Conservative, Larry Miller]

No, absolutely not. This would cover the existing witness list that we have, Wayne.

[Wayne Easter, Liberal, Malpeque, PE]

Okay, I so move.

[The Chair, Conservative, Larry Miller]

It is moved by Mr. Easter. Is there any discussion?

(Motion agreed to [See Minutes of Proceedings])

I guess the motion carries two to nothing. Thank you very much.

In the essence of time, we'll move right into our witnesses.

From the Canadian Canola Growers Association, we have Mr. Rick White. We'll ask you to make a few opening remarks, Mr. White.

[Rick White, General Manager, Canadian Canola Growers Association]

Thank you, Mr. Chairman.

My name is Rick White. I am the general manager of the Canadian Canola Growers Association and a farmer from southeastern Saskatchewan. I want to thank you for inviting CCGA to speak to this committee on a bill of great concern to canola farmers.

CCGA represents over 50,000 canola growers across Canada and is governed by a board of directors, who are farmers representing all provinces from Ontario west to B.C.

Speaking as a grower, canola is essential to the profitability of our farm. Beyond being the most profitable crop, it also allows us to generate predictable cashflows at all times of the year, and that's critically important to any business, but especially for farming, where other crops can be less financially predictable.

I believe that biotechnology has played a very significant role in canola becoming our most valuable crop. When herbicide-tolerant canola was introduced, it represented a major shift in the way we grow canola, making our land and environmental stewardship practices much stronger.

Canola is not a very competitive crop, meaning that when the seedling emerges from the soil, it is not very competitive with weeds that also germinate. Weed control has always been a challenge with canola. In the past we used intensive cultivation, soil-incorporated herbicides, and multiple herbicide applications to control weeds. With the introduction of herbicide tolerance, we now control weeds with only one pass of the sprayer, and this means less chemical is applied to the soil and we spend far less money on fuel and labour.

In addition, and equally important, is the fact that we can seed canola directly into the soil, disturbing less than an inch-wide strip of the soil for each row. We no longer need to till the soil. Reduced-tillage farming has real and significant benefits to the health of our soil and to the environment.

Beyond the benefits of weed control, the GM canola varieties we grow on our farm have proven to produce the strongest plants under what seem to be constantly changing climate conditions on the prairies. For several years we dealt with near-drought conditions; now this year we're dealing with one of the wettest springs ever. These are extreme conditions, and the GM canola varieties we grow produce plants that are much more robust and can withstand the blistering heat or soggy conditions better than the conventional varieties.

The impact of this on the profitability and success of our farm should not be underestimated. By being better able to withstand these types of variable conditions, these varieties reduce our risk and provide more income stability to our farm. I would estimate that, on average, our yields from GM canola are 30% to 40% better than open-pollinated, non-GM varieties. In years of drought or excess moisture, the GM varieties will be the difference between a crop failure and simply a less than average yield.

The canola industry has reached its success because of our ability to out-innovate our competitors by using the best science available. New and innovative traits will be key to maintaining and expanding our domestic and export industries.

I'd like to point out clearly that canola is the crop that pays the bills on our farm.

I'll take off my farmer hat and speak about the CCGA more broadly.

Science and innovation, including biotechnology, have been key innovation tools in achieving the economic and agronomic successes in canola. Recently this committee released a report entitled Competitiveness of Canadian Agriculture, which stated that:

Technological innovation is one of the best ways of improving Canadian farmers’ competitiveness through efficiency gains, higher yields and new product development.

We couldn't agree more. Innovation is essential to ensure that canola remains a western Canadian success story. The cornerstone of Canadian crop innovation is a predictable and science-based regulatory approval system that encourages investment in research and development. That is the system that has allowed us to achieve so many successes in the canola industry and that will allow our industry to remain competitive in the future.

This is why the Canadian Canola Growers Association views Bill C-474 as a significant threat to the future competitiveness of our industry. If the regulatory approach in this bill had existed 30 years ago, the $14 billion in economic activity that the Canadian canola industry generates annually would likely not exist today. If this bill is adopted now, with our competitors adopting new technologies at an increasing rate, our industry, including Canadian farmers, handlers, researchers, and processors, would be competitively hobbled. There's no doubt this bill would have a significant negative impact on the future of the canola industry.

If the regulatory process governing the introduction of new technology were expanded to include non-science criteria, there could be severe consequences for the canola industry.

First, the potential for political and activist intervention in the process would be significant and create additional risk for canola's technology investors. As a result, given that Canada is a major canola production region and that the crop is relatively small when compared to competitors such as soybeans or palm, uncertainty about the Canadian regulatory process could divert research and development dollars away from canola and into other field crops, or to other countries where the regulatory approval system is more predictable.

This would leave Canadian farmers at a major competitive disadvantage, putting in serious jeopardy the introduction of new plant traits, such as improved stress tolerance, higher oil content, and enhanced nutritional properties for consumer health. Other traits include nitrogen-use efficiency, which will reduce the crop's need for fertilizer, and resistance to new and emerging pests, which can help stabilize both the food supply and farm incomes by reducing the frequency and severity of crop disasters. These new traits will not only provide additional market opportunities for Canadian farmers, but will also provide further benefits to our environment, the health of our consumers, and the rural economy.

Secondly, the adoption of Bill C-474 would mean that key customers would no longer be able to cite the Canadian example of science-based regulatory approvals as justification for maintaining similar systems in their own countries. The potential for other countries, particularly those that grow rapeseed, to use non-science-based criteria in order to control imports with non-tariff trade barriers could be justified on the basis that Canada no longer has a solely science-based system.

To preserve and expand export markets and ensure continued research and development in canola, the Canadian Canola Growers Association supports the continuation of the current science-based regulatory system governing the introduction of all varieties, including those derived from GM technology.

Since the adoption of GM canola in 1996, canola has continued to expand its export markets. From 1998 to 2008, Canadian canola exports increased by over 40%, from 3.9 million tonnes to 5.6 million tonnes, and our trade represents 75% of the global trade in canola and rapeseed. Looking forward, the industry has set a goal of 15 million tonnes of sustainable production by 2015; 7.5 million tonnes of that is expected to be exported as seed, and upwards of 85% of the total crop will be exported when canola oil exports are included.

These targets and successes speak to the canola industry's confidence in its ability to grow the market for GM canola and in the acceptance of GM canola by our major customers. They also speak to the success of the Canola Council of Canada's market access policy, a voluntary industry agreement that ensures new GM seed traits are only introduced commercially when they have been approved in key export markets. The fact that this policy has always been respected since its inception in 1995 is a strong reflection that the industry recognizes and respects the importance of being responsible about the introduction of new technologies and does not require regulation to police itself.

That said, ensuring Canadian farmers have access to international markets is a serious issue for the canola industry. However, we believe our efforts would be better spent working with governments around the world through vehicles such as Codex, to develop low-level presence policies and agreements to ensure that the low-level presence of traits that have not yet been approved in the respective importing country does not disrupt trade flows. Rather than work toward a more realistic and forward-thinking solution, such as low-level presence agreements, Bill C-474 would maintain the zero-tolerance thresholds, which are pragmatically impossible to achieve and can cause trade disruptions, especially as the ability to detect even the most minute traces of material increases.

In summary, Mr. Chairman, I would like to stress the importance of science and innovation to the future success of the canola industry. But future innovations and the competitiveness of the Canadian canola industry could be in jeopardy if Bill C-474 is passed through Parliament. While this bill is intended to protect market access, creating an unpredictable investment environment for Canadian crop research and development is an unacceptable consequence of this legislation.

Canola farmers will require all future technological advancements to be made available to them in order to remain competitive. As a nation, we need to facilitate this, not hamper it. As canola farmers, we strongly support maintaining Canada's current science-based regulatory system for approving new canola varieties. We urge you to do the same by recommending to the House that Bill C-474 proceed no further in the legislative process.

Thank you for the opportunity to speak. I look forward to your questions.

[The Chair, Conservative, Larry Miller]

Thank you, Mr. White.

From the Canola Council of Canada, JoAnne Buth for 10 minutes, please.

[JoAnne Buth, President, Canola Council of Canada]

Thank you very much, Mr. Chairman, and thank you to the committee for the invitation to the Canola Council of Canada to be here today.

The Canola Council is a vertically integrated trade association that represents all sectors of the canola industry, including seed developers, growers, processors, and exporters. We all sit at the same table to ensure that the canola value chain remains intact and profitable, so it's fitting that we're here today to address an issue that does and will continue to affect the entire value chain.

I'd like to make three main points this afternoon: the importance of trade to canola, which Rick has already mentioned; what the canola industry is doing to ensure that trade continues; and offer a solution to Bill C-474, dealing with low-level presence.

The first point I'd like to make is that avoiding market access issues that affect our farmers and industry is clearly a top priority for us. Over 85% of Canadian canola is exported, and canola faces both tariff issues and, increasingly, non-tariff trade barriers. We agree with Mr. Atamanenko that the most extreme and destructive market access issue is when a large market closes suddenly. The committee is right to be concerned about the impact of such an event and its impact on farmers throughout the supply chain, from seed developers to exporters. I'm sure you're aware of China's concern with a disease called blackleg and new U.S. regulations on sustainable biofields. The canola industry needs to be ever vigilant, ensuring that our farmers and industry have access to markets around the world.

Allow me to take a moment to pass along our industry's appreciation to the federal government and to all parties in the House for their support on these issues. When China imposed new restrictions in November, Minister Ritz and the new Market Access Secretariat swung into action immediately and secured important temporary arrangements to maintain trade. The Prime Minister took this issue up with his counterpart on his visit to China. The government has been active since then to fully restore the market. This strong support for our sector is critical.

We have also had support from parliamentarians from all parties. With your agreement to pair MPs, Minister Ritz was able to press our case in China again earlier this year. Monsieur Gaudet from the Bloc Québécois was also on the mission and advocated strongly in support of agricultural exports from his region.

So we thank you all for promoting agriculture overseas, and we assure you that we are fully engaged in defending the rights of our farmers to compete on world markets.

The second key consideration for this committee in examining this bill is the remarkable innovation and competitive advantage made possible to all our producers by canola seed developers, particularly through the application of genetic modification. As Rick pointed out, canola farmers have gained yield, improved quality, reduced costs, saved valuable time, and, most important of all, achieved higher margins directly from innovation and seed development. Canola has been Canada's most valuable crop for the last four years. In 2009, canola provided growers with over $5 billion in farm cash receipts. About 90% of canola is genetically modified to be resistant to specific herbicides. Canada's farmers have adopted this innovation eagerly and are looking forward to future innovation.

We agree that we have to do everything possible to avoid market access challenges, but not at the expense of science and innovation that is at the heart of our success. A move away from science-based framework for biotech is an invitation to other countries to deny our science and eliminate our competitive advantage in world markets. It's a huge gamble with our industry, and we strongly oppose it.

We urge the committee to report to the House that this bill proceed no further through the legislative process. In the debates that have taken place on this bill, one of the questions that comes up is, if not Bill C-474, what can be done to protect farmers from the losses associated with market closure? We have a recommendation for you to consider, and this is my third point to the committee.

I would like to outline what the Canola Council and the industry do now to mitigate against market challenges based on our GM advantage.

The Canadian canola industry market access policy is a voluntary industry agreement that ensures new GM seed traits are only introduced to Canadian producers when they've been approved in all of our major export markets. Since its inception in 1995, the policy has always been respected. Seed developers, before they introduce new varieties, consult the industry. The industry policy ensures that no new GM canola traits are grown before international markets have approved them for import. Because Canada's grain handling and transportation system does not segregate by seed variety, it's important that all traits be approved in major markets before they're grown. The major markets that are part of the policy are, clearly, Canada, the United States, Japan, Mexico, China, South Korea, and the European Community.

We also work directly with farmers to ensure they grow only approved varieties and utilize acceptable pesticide treatments that could impact trade. We do this through our export-ready communications program. It provides information to growers in the industry on acceptable pesticides, seed treatments, canola varieties, and approved GM traits for canola that are destined for export markets. The objective is to ensure producers are only growing and delivering canola varieties that are approved for delivery in major markets.

The export-ready program is a central component of the council's communications with farmers. The Canola Council provides this information to growers at farm meetings and in communications throughout the year. Producers can access all required information from the Canola Council website. In the coming months, as part of our efforts to improve all aspects of our market access planning, including dealing with the blackleg issue, we will be communicating more assertively to producers.

Let me now turn attention to an alternative approach to managing the risk of unapproved GM events inadvertently appearing in grain shipments in an importing country—and this is my third point. The solution we recommend is a regulatory framework for managing low-level presence of a GM trait under these circumstances. As an alternative to the immediate closure of a market under a zero-tolerance standard, an LLP approach would provide for the importing country to adopt a risk-management approach to allow a low level of GM while a permanent solution is determined. This avoids the market calamity, which can impact producers and businesses that rely on the trade of this product, while ensuring the health of humans and animals.

The real issue for GM traits in the international arena is the zero-tolerance approach to any level of a GM trait that is not approved in an importing country. We know that once a trait is commercialized, there will be low levels in a commodity. We cannot achieve zero because of the grain industry bulk handling and transportation system. Because regulatory systems applying to GM products take a zero-tolerance approach, the market can suddenly be fully disrupted, despite the fact that the GM trait in question has been proven safe and it's not purposely being introduced into that market but is detected at low levels. This is not a health and safety issue. It is important to remember that all approved events have been tested and authorized by at least one competent regulatory authority or by one country, so they are approved as safe for human and animal consumption.

There is no risk to human health in approved GM products. The problem is not with the GM trait that has passed this rigorous analysis and approval. It is with the inflexible, zero-tolerance regulatory systems. The reality today is that trade stoppages are being caused by regulatory non-compliance issues that don't relate to scientifically supported food, animal, or environmental concerns.

Rather than stick to a rigid zero-tolerance model, which will undoubtedly result in more market havoc as the number of GM products and volume of international trade increases--and we know it will--regulators should move to a risk-based approach that accounts for low-level presence. The solution to dealing with trade issues as a result of GM is the development of global policies and approaches to risk management and low-level presence. This can include harmonization of approvals, mutual recognition of another country's approval, and use of the Codex guidelines, which were developed specifically to resolve these issues.

We need leadership in the global marketplace to show that an LLP policy can work, and Canada needs to be that leader. The development of a new Canadian LLP policy would show that risk-management procedures can be employed by importing governments for unauthorized GM events, thereby removing zero-threshold policies and facilitating our exports. The development of international LLP policies would encourage innovation within our grain industry by removing an industry's fears that LLP of a new event would automatically disrupt trade.

For Canada's canola sector, the choice for the committee is clear. Canada can lead in the development of practical, realistic trade policies, which facilitate continued innovation and profitability for our sector. These need to encourage innovation for the farmer and leave market decisions to the producer and the grain exporter. They need to be grounded in science and vigorously defended in all international forums.

The other road that is contemplated by Bill C-474 is to categorize our innovation and science as a liability, to limit our farmers' access to proven, safe, effective seed technologies because of an ill-defined, non-science-based market assessment, and to take market judgments away from the farmer and the private sector.

Once again we urge the committee to recommend to the House that Bill C-474 proceed no further in the legislative process.

Thank you.

[The Chair, Conservative, Larry Miller]

Thank you, JoAnne.

We will now move to the Canadian Soybean Council, with Jim Gowland and Michelle McMullen.

[Jim Gowland, Chair, Canadian Soybean Council]

On behalf of the Canadian Soybean Council, I would like to thank the committee for inviting us to participate in the discussion concerning Bill C-474.

My name is Jim Gowland, and I have been the chairman of the Canadian Soybean Council since its inception five years ago. I would also like to introduce Michelle McMullen, who is the manager of the Canadian Soybean Council. She also started with the Soybean Council five years ago.

The Canadian Soybean Council represents the interests of 30,000 soybean growers in Manitoba, Ontario, and Quebec. I am a cash crop farmer from Bruce County, near Walkerton, Ontario, and I farm approximately 2,300 acres of soybeans, wheat, corn, and white beans, in partnership with my wife Judy.

Our farm incorporates the benefits gained through biotechnology, while taking advantage of the opportunities to add value to our farm operation by growing non-GM soybeans for world markets. All of our production has been non-GM soybeans for many, many years.

Soybeans have been grown in Canada for over 60 years. They are mainly grown in Manitoba, Ontario, and Quebec, but recently, owing to advancements in plant breeding, soybeans have started to be grown in the Maritimes and in Saskatchewan.

In 2009, approximately 3.5 million acres of soybeans were planted across Canada, making soybeans Canada's sixth-largest crop in overall production. Soybeans were ranked as Canada's fourth-largest source of farm cash receipts in 2008, with a total value of approximately $1.13 billion. Currently, 65% of soybeans in Canada are genetically modified. The remaining 35% are non-genetically modified but are destined mainly for export markets.

GM soybean varieties were introduced back in 1997, and the Canadian soybean industry saw the need to re-examine its production and handling systems. Dialogue was initiated with key stakeholders—including government, our customers, and export markets—to explore quality management practices throughout the value chain. Over the past 13 years our industry has demonstrated that we are skilled and experienced in developing and implementing protocols that can segregate specialty soybeans from bulk-handled grains. The investment of time and infrastructure was crucial to support the coexistence of GM and non-GM soybeans in addressing the needs of the industry's key market segments.

Science and innovation have played an important role in the success of our industry. Public and private investments in plant breeding have allowed Canada to capture opportunities using both non-GM and GM technologies. These opportunities help Canada's soybean growers to add value to their farm operation in both domestic and international markets.

Continued investment in biotechnology by seed companies will result in the development of new varieties that will bring production advantages to producers and benefits to consumers. These opportunities, which could add value to Canadian soybeans, could be put in jeopardy by the introduction of Bill C-474 and place Canada at a competitive disadvantage.

Maintaining our current markets and accessing new markets will continue to be a challenge. Many countries, including Canada, have a zero-tolerance policy regarding unapproved events that are developed through biotechnology. It is impossible for our industry to guarantee zero contamination of GM traits. Approval of new GM traits in our key export markets establishes thresholds that our industry can meet. If an unapproved GM trait is identified in a Canadian shipment, though, there is a zero-tolerance policy that could result in closure of the border.

[André Bellavance, Bloc, Richmond—Arthabaska, QC]

Excuse me, Mr. Chair?

[The Chair, Conservative, Larry Miller]

There is a 30-minute bell.

[André Bellavance, Bloc, Richmond—Arthabaska, QC]

They have asked us to go there immediately for some time. We do not give consent.