Agriculture Committee on Nov. 18th, 2010

[The Chair, Conservative, Larry Miller]

Thank you.

Mr. Lemieux, you have seven minutes.

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

I'll just finish off on that, Mr. Chair.

Malcolm, we'll get you written in on recommendation number 7.

[The Chair, Conservative, Larry Miller]

Okay.

Mr. Lemieux, you have seven minutes.

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

Thank you very much, Chair.

Minister, I have two questions I'd like to ask, both related to trade, so I'll ask them both at the same time.

The first has to do with international trade. I think everyone around the table would agree that the more markets our farmers have to sell into, the better it is for our farmers. Of course, we have our domestic market and domestic consumption, but we also have international markets. You mentioned it in your speech, but not in much detail.

I know that you've travelled with these farm group organizations, these representative organizations. Sometimes Mr. Easter doesn't value their opinion; however, I do. These people in these organizations, these leaders in these organizations, are producers themselves or were producers for most of their lives, and they certainly do represent producers on the ground.

You've travelled with them to other countries to open markets, so I'd like to know if you could just provide a bit more detail to the committee on some of the markets you've opened and the feedback you've received from these groups, particularly in terms of feedback they're receiving from farmers on the ground.

The second question I'd like to pose to you again has to do with trade, but it's trade within Canada. Minister, you're aware that this committee travelled out to B.C. last spring as part of our young farmers study. I was also back there this summer making an announcement for the grape-growing sector about money to help them with research and development and help fight crop loss, etc.

I visited a number of wineries and certainly one of the concerns that was brought forward was on the point that our Canadian wines are excellent wines. They're highly competitive and win awards in other countries. One of the vineyards we visited had just won a top-level award in Europe, yet the producer said that here in Canada, he is landlocked in B.C. He's not able to sell his wine openly and freely into other provinces. This is because of the Importation of Intoxicating Liquors Act of 1928, which places restrictions on the ability of our wine producers to move their product throughout Canada. The Canadian Vintners Association, the Canadian Chamber of Commerce, and others are calling for the ability to move wine freely between provinces.

Minister, I wonder if you could comment on international markets, international trade, and how that's impacting the farm sector here in Canada. Also, could you tell us what kind of action you might be taking or what kind of progress you've seen on these trade barriers, these provincial trade barriers for vintners?

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

Sure. Certainly, Canadian farmers and processors have proven that they can grow it and process it as well as anybody in the world, if not better. We have some tremendous products that we do export. On average, we export 50% of what we produce. In some instances, like canola, we export between 85% and 90% of what we produce, so it depends on the sector and the region of the country as to where that market is seen.

On the international stage, I guess the best report card we've had is that our exports of agricultural products are up some 8% this year already. That's a tremendous response to the work that's been done by industry and government officials around the world. Our market access secretariat is certainly punching above its weight in a number of those situations. The trade secretariat under Agriculture Canada, and of course, backstopped by tremendous CFIA people, has been able to re-invigorate and rejuvenate some of those markets that had either closed or gone stagnant with regard to Canadian product.

Without exception, on first blush, in the first run of countries that we identified, working with industry, one of the first lines we always got from the agriculture or trade people was: where have you been? The Australians are very aggressive traders. The Brazilians are stepping up. The U.S., of course, is always there trying to dominate a market, and good for them, and even Europe is in certain sectors.They were quite surprised that Canada had not been there. There was almost a decade where Canada had gone quiet. We're happy to get out there and do that. We've had a tremendous response. As I said, it's up 8% this year alone.

The international markets are a tough nut to crack, but once you get that foot in the door and industry has the ability to prove what it can do and get that good Canadian product on the shelf, we know we can succeed. There's a tremendous and growing respect for Canadian products around the world, for the safety of those products, and for the sustainability to supply those markets even in tough weather conditions like we saw this year--we're still able to do that with the quality of product. There are some marketing lessons to be learned. We have to do more. We have to attend more international food shows. We have to be there showcasing what we have so that people know and can buy it.

Domestically for products, it has always been a bit of a thorn, but the provinces have stepped up. Of course, everyone identifies Alberta beef, Ontario pork, and the different areas that really work hard on market branding and selling that product. As it turns out, you can sell a piece of beef to Montana easier than you can sell it to Saskatchewan from Alberta. It's ridiculous in the extreme. There is a rejuvenated recognition of that. The provincial and territorial premiers signed a new agreement on internal trade, and we're moving forward, I hope, to some good positive results in moving that product east to west as easily as we move it north to south and outside the country.

On interprovincial trade of wine, as you said, it's based on an antiquated situation going back to 1928. Certainly, our wines and spirits have improved a lot since then. Some of them have aged that long waiting to go across borders.

[Voices]

Oh, oh!

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

I'll have to buy that first case. It would be pretty good stuff.

But there is agreement that we should be starting to move forward. There are still some kingdoms that want to maintain themselves. I think there's a good amount of work being done and that needs to continue to be done. It's one of those real anomalies that with the advent of the Internet--which Al Gore says he invented--people can see it online and I can get on an airplane and buy Canadian wine anywhere around the world, but I can't buy B.C. wine in Saskatchewan, which is absolutely ridiculous to me. If I fly out to Vancouver, I can buy it and bring it back, but I can't.... It's one of those anomalies that makes no sense at all. Certainly, there are some taxation issues that provinces need to work out reciprocally, and I know they will take that work on and get the job done.

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

Thank you.

[The Chair, Conservative, Larry Miller]

You have a few seconds left.

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

Could you tell us a little bit more about the market access secretariat? Certainly, I've heard good reviews on the ground, and as I say, the groups that are travelling with you have good things to say about the market access secretariat.

However, Canadians might not be aware of it. We as politicians are, but as this is a public committee meeting, I'm wondering if you could explain this market access secretariat, the work it does, and how it is helping farmers.

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

It was an idea that was percolating around Agriculture Canada for quite some time as we started looking with envy at some of these markets that had been shrinking with regard to Canadian wares but were being picked up by other people. How do you get trade-specific people on the ground with the knowledge and the backstop from here to get their toe in the door as good salesmen? We began that, and industry added in and told us what they thought it needed and how we should be delivering it.

We've used that as an outline, as a road map forward. Fred Gorrell heads up that market access secretariat, backstopped by some tremendous people. I've had the great opportunity to work with them around the world.

Of course, into the mix we put some top quality CFIA veterinarians. We have a technical person who travels around the world, Dr. Bob Morrison, from Prince Edward Island, actually, who does a tremendous job in working out the technicalities on a lot of these things.

Dr. Gary Little has done yeoman's service in Colombia and Korea on beef. We continue to have discussions with the Koreans even though we have them before the WTO with a panel on beef market access. Our folks just spent another week or 10 days in Seoul pushing that envelope further and further, to the point where it looks like there's a glimmer of hope that we may not have to go all the way through with the panel. We're hopeful that the hammer of the panel, plus the good work done by the market access secretariat, will get that work done in the near future.

[The Chair, Conservative, Larry Miller]

Thank you.

Before we move into the second round, I want to ask something.

Minister, here in Ontario, a number of producer groups have been pushing forward for a BRM. You've said in the past that if seven or more provinces come together and request that, you're obligated to sit down and listen to them. But the last time I looked, Ontario was the only one. Is that still the case? Are there any other provinces that have been asking for that?

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

Are you specifically talking to the RMP?

[The Chair, Conservative, Larry Miller]

Yes, it is the RMP. I'm sorry. I said the BRM. There are too many acronyms.

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

Okay. No other province has come forward with that. Every other province has developed smaller companion programs for specific situations that arise. They are more directed at weather-related situations than at the overall cost of production, like the RMP. I still have the same concerns, as do the other provinces, that it's completely countervailable if it ever paid out in any significant way. To date, it has not. They have not found the trigger that actually works any better than any other situation that comes forward. They've extended it for one more year. They're trying to work on that. I give Minister Mitchell credit for that.

Having said that, I'm still very concerned. I do get letters from producer groups across the country, which of course have representatives in Ontario, saying to please don't do this, because if it closes our border, the little bit of money that we trigger through RMP would not offset the hurt we would see with a closed border.

[The Chair, Conservative, Larry Miller]

Thank you.

Mr. Eyking, five minutes.

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

Thank you, Mr. Chair.

Minister, you and I have been farmers for probably 20 years; we've been on this Hill for over 10 years. We both know that you can spin a pretty picture up here on the Hill about life down on the farm, but at the end of the day down on the farm, you have to pay the fertilizer and feed bills.

Last spring our committee travelled across this country about the future of agriculture. We've seen some bright spots, but it was mostly only in supply management. The other sectors are losing their equity at an alarming rate.

We've heard some testimony. I'll give you a couple of examples from across the country. Mr. David Machial from British Columbia said:

First of all, our current AgriStability...programs are not a solution.... It provides a little money, but it's not enough. And the way AgriStability is set up, if you have two or three bad years in a row, that's it, you're done.

That's from British Columbia.

Then we go to Saskatchewan, where we have Ryan Thompson, who said:

The current business risk management programs don't work for beef producers.

My final example is from William Van Tassel in Quebec. He said:

However, when crises persist--like the one the beef producers and pork producers have been going through and the one that hit the grain production sector a few years ago--this program no longer works.

Minister, your government has been at this place for five years. My simple question is, with five years in government, how come you couldn't come up with a better program that could help farmers, especially the non-supply management farmers?

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

Mr. Eyking, as you well know, this is a shared jurisdiction between the federal government and the provincial and territorial governments. We continue to work on these programs on a 60-40 basis, but everybody has faced fiscal constraints. As I said in my speech, we've delivered a tremendous amount of money over the last program period you're talking about.

Is it always enough? No. Should it be? No. Government programs should never distort accurate market signals. Management of farms is up to the farmers themselves. Government needs to be there when there are disruptions in weather, and that leads to crop insurance and those types of things. I'm hopeful that more and more farmers recognize the validity of the program payments. Certainly there has been some concern that we're still forced to go back and redo some of the CAIS situations, which of course your government managed. There are situations where farmers are still in trouble because they were not covered properly at that point. The foundation was not laid properly under those programs.

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

You've had five years--

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

Now, I give credit to Mr. Vanclief, who brought that in, for at least recognizing the point that to have stability you need a five-year program. But with the way agriculture has changed in the last little while--and we have been talking about this--you may also need flexibility within that five-year window to let farmers grow and develop in the new biosecure situation and biotechnology and all those different things that are out there.

There is a lot of discussion around a national food policy. I think that's good work; it's work that needs to be done. It needed to be done for decades. But that is only half the situation. Farmers themselves have moved well beyond just producing for food. We have the ability to fill two or three streams with the raw materials that farmers produce--you yourself as a producer of horticultural goods and chicken, I understand.... We're starting to see a lot of the biomass and byproducts from those industries being used--and when it comes to chicken feathers, even into car parts

That's a tremendous amount of good work. I think the future of farming is marketplace returns that farmers have never had access to. It's doing more and more with the product and the byproduct we produce.

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

My time...?

Mr. Valeriote, go ahead.

[The Chair, Conservative, Larry Miller]

Please be very brief.

[Frank Valeriote, Liberal, Guelph, ON]

Thank you, Mr. Chair.

Thank you, Minister Ritz, for appearing.

I have two quick questions.

First, among those people we spoke to in crossing the country, there was concern about farm transfers to the next generation, and that the next generation--younger children--wasn't necessarily prepared to take those farms. Will you and are you considering talking to the Minister of Finance about changing the tax regulations on transfers to non-related people?

Second, with respect to GMOs, we know that GMOs are going to be necessary if we're going to build capacity in poorer countries and if we're going to be able to deal with agriculture in the face of climate change. However, notwithstanding that, we heard in our discussions on Bill C-474 about the threat to biodiversity, particularly in wheat and alfalfa.

What do you plan to do about that with regulations? What are you looking at to protect our alfalfa and wheat farmers from the threat to biodiversity by GMOs?

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

Let me start with the last one first. I think the best way to mitigate that threat is for farmers themselves to make the decisions on what they want to grow, based on sound science, and they will do that. That being said, there's a growing reception in the world that biodiversity is the future, that if we want to really secure our food supply and make it sustainable, we have to start talking about biodiversity, biotechnology, and moving forward.

I've had some tremendous discussions in Europe, which has been a GM-free zone. They're now starting to talk about low-level presence in a different way, as we got caught with Triffid in our flax, and so on. They're starting to look at ways to mitigate that, because they recognize the validity of moving forward with biotechnology in order to feed their own people and export to the world market.

I think farmers themselves are the best ones, in the final result, as to whether or not they're going to grow any product that's GM, whether it's alfalfa, wheat, or canola. I mean, if we didn't have the ability to modify a product and move forward, we would not have the canola industry, which is now king in this country. It used to be that wheat was king, but now it's canola and the processing sector that has developed around it.

On intergenerational transfers, certainly, we will make that moving forward, as the farm groups do themselves: arm's length, non-arm's length, and those all those types of things. We have made some significant changes to capital cost allowance and intergenerational transfers. That work continues on through Finance. Again, it comes down to fiscal capacity.

But I had a great opportunity earlier this week to speak at the luncheon for future farmers, young farmers, who were in Ottawa. A panel was set up from across this country and across every type of agriculture you can think of. I'll tell you that the energy and dynamism that was around that table gives me hope for the future. These young people are ready to take over the reins. They're ready to take over on the farm and move forward. They want less government. They want to make sure that regulations help them move forward and don't restrict them. They're committed to the environment, food safety, and a solid future in agriculture.

We have a tremendous opportunity to learn from them. I give my colleague, Jean-Pierre Blackburn, who's been handling that file, a tremendous amount of respect for the work he has done. It was a great group that he brought together that day. The next step is to start to introduce the value-added processing to these young farmers. They know they can produce, but they also want to be two or three steps up on that ladder. They don't want to just see it disappear at the end of the farm gate; they want to control it a little further and drive some money back to the farm from it.

[The Chair, Conservative, Larry Miller]

Thank you.

Mr. Storseth.