Agriculture Committee on Dec. 6th, 2011

[The Chair, Conservative, Larry Miller]

I thank the witnesses for being here today.

We have with us from the Quebec group, Mr. Nil Béland; and from Potatoes New Brunswick, Joe Brennan, chair; from the Saskatchewan Association of Rural Municipalities, Ray Orb; and by video conference, from the B.C. Breeder and Feeder Association, Connie Patterson and Lindy Gilson.

I will just make a comment to members. The interpreters are having a little trouble with the audio. We are trying to sort it out on the video at the other end. Hopefully, by the time we get to it we'll have it solved. They're doing their best is all I can say. We may have to carry on as best we can, but I just wanted to put you on notice.

With that, Mr. Béland, I turn it over to you for 10 minutes or less, please.

[Nil Béland, Member, Board of Directors, Éleveurs de volailles du Québec]

We looked at the programs in a very summary manner. For us, Éleveurs de volailles du Québec, the most important program in the poultry sector and that pertains to the supply management issue is the AgriStability Program.

AgriStability has not been used much so far, if at all. We use it mainly in case of serious disasters, such as the one that occurred in British Columbia six or seven years ago, in the case of the avian flu.

The AgriStability program is meant to be used in case of a poultry production disaster. What we need most are not necessarily programs as such, but rather the protection of supply management. I think that the various parties took very strong positions in the last few weeks, and we are happy about that. It enables the producers, the industry and the consumers to get more for their money.

The issue of supply management has limited the need for new programs so far. Let us take the case of Europe. They abandoned supply management in milk production. Since then, they have had to create new programs to help producers and processing plants survive. Whereas here, in Canada, supply management makes all forms of substantial financial support from the state unnecessary. Moreover, it allows consumers to get more for their money every week.

Studies of chicken production have been conducted and supported by Laval University. They compare our production with chicken production in France, in the United States and in Australia. In some countries, the free market rules. They have done away with supply management. In our country, supply management has been maintained.

In Australia, for example, the price paid by the consumer has increased more than in Canada. The producers and the industry have less and less money. It is the distributors that have taken in most of the money. So far, these countries have not had to intervene significantly to help producers. However, they have started doing so recently. Maintaining supply management will make it possible to avoid investing additional money.

For us, Éleveurs de volailles du Québec, AgriStability is a tool enabling us to face disasters such as the one we had a few years ago. That being said, the program's effectiveness is theoretical for the time being. We hope that remains the case, since we do not want any disasters.

Our environment is obviously very regulated. In comparison, the banking environment, despite being heavily regulated, generates money and does not jeopardize the economy of the country. It is similar in our case. Supply management allows us to keep the ball rolling and still bring in money for the state, instead of costing it money through various programs. When I say that, you understand that it does not prevent....

I am looking for words. You know that this is my first time here, and it is a bit intimidating, especially since I am the first one to speak.

[A voice]

We are normal people.

[Voices]

Ha, ha!

[Nil Béland]

I know that, I know that. Ha, ha!

To return to the issue of programs, the protection of supply management is essential. That is the case not only for producers, but also for the whole community and industry.

One of the missions of our system is to keep the agriculture alive in as many regions as possible. That is in fact what we are seeing everywhere.

I cannot perhaps speak for all Canadian producers, but in Quebec, we have programs throughout the province to help people start a business. They make it possible to keep the economy alive throughout the province.

That summarizes our interest in requesting this type of support. I would like to tell you how to improve the AgriStability program, but since it has remained basically theoretical so far, I cannot do that.

That is the presentation I wanted to make. Thank you.

[The Chair, Conservative, Larry Miller]

Thank you very much for being brief.

Mr. Brennan, for Potatoes New Brunswick.

[Joe Brennan, Chairman, Potatoes New Brunswick]

Thank you, Mr. Chairman.

First of all, I'd like to thank you all very much for the opportunity to present to you today on behalf of Potatoes New Brunswick. Our organization represents 186 potato growers in the province. We currently grow approximately 50,000 acres of potatoes. Slightly over half of our crop is sold for processing. The majority of that is for french fries, but there are some chip potatoes. The balance is divided between the fresh market and seed production.

[The Chair, Conservative, Larry Miller]

Mr. Brennan, could I just get you to slow down just a hair? The interpreters are having trouble keeping up.

[Joe Brennan]

Fair enough. I've had that problem before.

[The Chair, Conservative, Larry Miller]

We're not having any trouble with that eastern accent. It's the speed.

Thank you.

[Joe Brennan]

We've been asked to present our views today on the business risk management programs that currently exist and to offer our thoughts on how to improve these programs in Growing Forward 2. Potato farming is a very high-risk business. This crop, like many other crops, is highly influenced by weather in terms of both yield and quality, and the market is influenced by supply and demand on a global basis.

In New Brunswick, we export the majority of our crop to the United States. Therefore, currency fluctuations and the health of the U.S. economy greatly influence our market. Potato production is a very capital-intensive business, too. Currently, our cost of production is approximately $3000 per acre. So we incur risk on many fronts. Our producers do use, and definitely need, the business risk management programs that are currently in place. I will attempt to address each program.

AgriInvest is utilized by most of our producers in the province. The current balance is approximately $7.5 million for the entire province, not just potato growers. As an organization, we don’t really know how actively this program is being used, and have not heard many complaints from our producers. It should be safe to say they are reasonably satisfied, because when they are not, we usually hear about it.

On AgriInsurance, approximately 65% of our acres are insured under the Canada-New Brunswick crop insurance program. This program has been an integral component in managing production risk for our growers, and we view it to be the front line of defence. In four of the past five years, we have experienced significant production problems in the Saint John river valley. The 2011 crop was the hardest hit. The planting season was delayed by cool, wet weather. A serious hailstorm hit parts of the valley in mid-July, affecting approximately 5000 acres. Rainfall was double the normal amounts. This excessive rainfall, which was upwards of 90 centimetres in some areas, caused problems such as soil erosion, terrace and waterway damage, and widespread late blight—which resulted in increased costs and reduced yields—and many other disease problems, which have resulted in storage breakdowns and a greatly reduced amount of potatoes to sell. We are estimating that the decline in the farm gate sales from this crop, plus the increased cost of production because of the problems, to be in the range of $60 million.

The result of successive years of below average yields is that premiums increase due to high payouts, while insured yield declines. Our crop insurance program is running a deficit. We realize that this program must be actuarially sound, but it is becoming uncomfortably evident that extreme weather events are much more frequent than they have been in the past. The effect on our premiums and our coverage is devastating. An extreme but very real example is where an entire crop is left unharvested because of disease. This automatically causes a 10% decline in that farmer’s coverage for the next 10 years. That very quickly reduces the effectiveness of crop insurance as a viable risk management tool for that farmer. This concern is similar when a farm experiences subsequent years of low production, and the value of the program diminishes.

We must have higher participation in crop insurance. It is the only safety net program that directly addresses in a timely manner a loss caused by production problems on a farm, so we must find a way to protect a farmer’s production at a reasonable level. It is imperative that adequate coverage is provided at a reasonable cost. I would even say that the premium level is secondary to the coverage level. The worst-case scenario is when the premiums are increasing while the coverage is decreasing. That is what is we're facing now. The result will be that fewer producers use the program and will end up assuming more risk themselves. This will put more strain on the other programs in the BRM suite, such as AgriStability and AgriRecovery, neither of which can address the risk as directly or in as timely a way as crop insurance.

I acknowledge that I have raised more problems here than solutions, but I believe that if we can agree on the importance of this fundamental pillar of risk management, we can find a solution that will better protect our producers.

On AgriStability, in talking with producers, accountants, and bureaucrats, I believe most would agree that the AgriStability program is generally meeting its objectives. It was not designed to support a sector or a producer suffering a prolonged period of unprofitability. It certainly doesn’t do that. With the advantage of several years of data, it has been suggested that a longer period be used to determine the reference margin. A five-year timeframe, particularly in these volatile times, may be a bit tight. Perhaps a seven-year period would provide more stability and better reflect the true performance of the operation.

The major criticism of the program is not of its design, but of its delivery. The delay in processing claims is often excessive. As an example, when a farm operation has a non-calendar year-end, it can be up to two years between the production year when the loss was incurred to when the claim is finalized. The fact that the Canada-New Brunswick AgriStability program is administered in Winnipeg does not help the situation. In light of the changes happening across Canada with the administration of this program, we strongly encourage the establishment of a maritime provinces administration centre. We have discussed this with our minister, and urge your committee to look into this option as well. We feel the program could be delivered more effectively and more efficiently on a regional basis.

Another common criticism of AgriStability is that it is very complex and most often requires the services of accountants when filing the returns. But I can't offer a better solution if we want a comprehensive, farm-specific income stabilization program. I feel that most farmers and accountants now have a good understanding of the program, and we will be better served by making the required adjustments to improve the delivery and design of this program than by replacing it.

In New Brunswick, we had an AgriRecovery program for the 2009 potato crop to assist with the cost of properly disposing of the part of our crop that broke down in storage as a result of a very wet and cold harvest season. The first challenge with this program, like others, was to understand how it's structured. Another concern is the time required to get an application approved and implemented. I realize this program must be developed and scrutinized very closely to verify the need and to avoid abuse; but as all parties involved with the process better understand the guidelines, I do expect the time required can be reduced. In the past, it's often close to a year after a disaster occurs before dollars actually flow to help address those losses.

In New Brunswick, we are again in the process of making another AgriRecovery application as a result of the disastrous situation our growers are facing with this 2011 crop. Although we've been working on this file since July, it is optimistic to expect to have a signed agreement by March 2012. I cannot criticize anyone or any department in particular for this, because I know first-hand that many people have devoted, and still are devoting, a lot of time and effort toward a favourable agreement. But we must find a way to streamline this process so neither the producers nor the system is paralyzed for so long.

As for the advance payment program, Potatoes New Brunswick administers this program for our producers. Currently, about 140 of our 186 producers participate, and we feel it works quite well. Our policy is to offer only the $100,000 interest-free portion, and our staff are very pleased with how the program is administered from Ottawa. Like any program, the need for some flexibility is important. Due to the situation we are in this year, we have made a request to the federal administration for a stay of default to help our producers get through this year without unduly pressuring their creditworthiness. We are expecting a response quite soon.

In summary, I feel that the existing programs have worked fairly well in attempting to manage business risk in our sector. Efforts to improve the delivery of all BRM programs must continue, with particular emphasis on more regional administration and improved processing times. Maintaining reasonable reference margins in AgriStability and insurance production levels in AgriInsurance is imperative if we are to adequately manage our risk.

I want to stress again that, as extreme weather events are becoming more frequent, and as costs continue to escalate, AgriInsurance must be modified and supported to adequately mitigate the increased risk. I believe this program will require more funding from both producers and governments. If this program does its job, the demands on other programs will decline, and the dollars will flow to where the need is greatest in a more timely manner, and with less chance of waste.

The potato industry in New Brunswick is vitally important to our economy. It’s the source of over $1.3 billion worth of economic activity in a province and region of Canada that desperately needs more development. The stability offered by the BRM programs over the past two federal-provincial-territorial agreements has been crucial to our survival and success. We look forward to working with our government partners to improve these programs and our industry.

Thank you very much for the opportunity. I would welcome any questions later on from your committee.

[The Chair, Conservative, Larry Miller]

Thank you very much, Mr. Brennan.

We now move to Mr. Orb, from the Saskatchewan Association of Rural Municipalities, for 10 minutes, please.

[Ray Orb, Vice-President, Saskatchewan Association of Rural Municipalities]

Thank you, Mr. Chair.

Good afternoon. My name is Ray Orb and I am the vice-president of the Saskatchewan Association of Rural Municipalities. I thank you for inviting SARM to present here today regarding business risk management programs under Growing Forward 2.

SARM represents 296 rural municipalities in Saskatchewan, which means that it is the voice for 100% of the rural municipalities in the province. It represents and serves the interests of Saskatchewan agricultural producers.

SARM consulted with the Province of Saskatchewan and Saskatchewan livestock industry groups prior to devising our recommendations. I will be speaking from that paper here today regarding the AgriInsurance, AgriRecovery, AgriInvest, and AgriStability programs.

Beginning with AgriInsurance, we feel insurance for crops needs to be improved. The largest problem with the current crop insurance program is that it does not have adequate coverage levels or reasonable premiums. An effective crop insurance program is one in which it is economically feasible for all grain producers to enrol. Suggested improvements to the program would include providing an option to buy up coverage at a reasonable premium rate to make the program more realistically reflect actual costs of production, that is, to have coverage beyond 80%. Arriving at a reasonable premium rate for this amount of coverage would require that government provide a bigger share of the premium than they are currently providing. Using the area average for yields, weather data, and coverage levels don't work. There is a need to collect more data at farm sites to ensure that these variables reflect reality. Crop insurance would have to ensure that all crops were insurable and that costs used to determine things like reseeding benefits reflected the most recent price and cost. SARM feels that if these improvements were made, then buy-in from crop producers would increase considerably.

We also see a need for an improved forage insurance program. Forage crops are not like annual crops, and therefore a forage insurance program specifically designed for forage crops is critical for livestock producers. Alternative insurance models that incorporate multiple weather variables such as precipitation, frost, humidity, heat, and wind are needed. That means adding more on-farm stations that measure more variables than just rainfall and temperature. Today's improved technology should make providing more real-time weather stations more cost-effective.

SARM would also like to suggest that forage insurance consider utilizing alternative variables to calculate program payments. For example, animal unit months, or AUMs, is a measurement that is currently calculated on pasture land by the Saskatchewan Assessment Management Agency. This measure takes into account the grazing capacity of these lands.

Lastly, we feel that AgriInsurance must include a program for livestock. The livestock industry in Saskatchewan and across Canada is asking, via the Canadian Cattlemen's Association, for a price insurance program for livestock with cost-shared government and producer premiums available at all stages of cattle production. SARM supports the Saskatchewan cattle groups and the CCA in this request.

Regarding the AgriRecovery program, we believe that disaster program like it must be continued under Growing Forward 2 to cover extreme situations such as market crashes and weather issues. Disasters such as these are unpredictable and out of a producers' individual control, no matter what management measures they take.

SARM's major concern with the current AgriRecovery program is how a disaster is defined. The definition of a disaster must be clarified and parameters outlined so that producers know what kinds of disasters will be covered. The current program provided disaster assistance for floods in 2010 and 2011, but southwest Saskatchewan experienced drought for four consecutive years around 2006 and received no assistance from the federal government. AgriRecovery should clearly convey to producers the definition of a disaster and outline the parameters defining what will and what will not be covered.

SARM understands the intent of the AgriRecovery program is to provide disaster relief when disasters strike, by filling gaps that are not covered by existing programs. And SARM believes that funding provided to producers from the program should not take away from payments received from any other programs under the BRM umbrella. For example, if a producer triggers a payment from the AgriStability program due to a margin reduction, then AgriRecovery funding should be above and beyond payments from AgriStability. AgriRecovery payments should not be included in a producer's income when calculating whether they are eligible for other payments.

All BRM programs, including AgriStability, should be simple to administer, both for the producer and for the government, to ensure the timeliness of payments and low administration costs. Producers need to hire accountants to apply for AgriStability, and the staff on the program administration team must be highly skilled to process these applications. Current complexities on both ends result in frustration, confusion, continued delays in payment distribution, and excessive cost. Also, the current AgriStability program is not bankable, which makes it difficult for producers to make annual plans as well as to attain financing, as lenders and institutions cannot define what financial coverage producers will receive.

We also see a flaw in the way AgriStability currently accounts for hay and feed grain inventories, as it doesn’t reflect how a livestock producer actually uses these products and it penalizes some when calculating margins. Livestock producers feed this inventory to their livestock, so it shouldn’t be considered part of inventory. It should be assigned a value and considered an eligible net sale, not a part of inventory. We realize that such a change would require an audit and verification process.

We continue to see issues with margin calculations. As AgriStability remains a margin-based program based on an average of previous years, it still results in a depressed margin for producers facing past years of hardship and disaster. For those with compounded years of drought or flood, it becomes increasingly difficult to trigger a payment because of the depressed margins that are their reality.

The last program we would like to comment on is AgriInvest. Many producers view the current AgriInvest program as beneficial, as it is easy to access in times of need. It is also predictable and bankable. In many cases, farms and ranches are getting bigger, so adjusting the contribution rates allowable under this program should reflect the realities and expenses of larger operations. Currently, this program is capped; producers can only deposit up to 1.5% of their allowable net sales into an AgriInvest account. SARM would like to see this increased to allow a producer to contribute up to 2.5% of allowable net sales.

In conclusion, SARM would like to stress the importance of making sure that business risk management programs under Growing Forward 2 work for all farmers. Administrative costs must be minimized, payments must be quick, and the data used to calculate payments must reflect reality to ensure that the support being offered is effective. What we are suggesting might not require additional funding. We are suggesting a reprioritization of existing funds to make BRM programs less administratively heavy and to redesign programs to make them more responsive to the needs of farmers. SARM doesn’t want to see BRM programs stifle innovation; instead, we want them to work in conjunction with funding for research, technology, and innovation.

SARM thanks the committee again for the opportunity to present. I would be pleased to answer any questions you may have.

[The Chair, Conservative, Larry Miller]

Thanks very much, Mr. Orb.

Now we’ll move to Ms. Connie Patterson for 10 minutes.

[Connie Patterson, Regional Administrator, B.C. Breeder and Feeder Association]

First of all, I'd like to say thank you for giving me the opportunity today to speak to you via video conference.

I'm representing the B.C. Breeder and Feeder Association, which is a provincial organization. We represent all the feeder associations and breeder associations in British Columbia.

We operate under a provincial government loan guarantee program and provide financing for association members to purchase cattle. We also administer the advance payments program for all British Columbia cattle producers. We have an administrator in our provincial office and a regional administrator, so we actually work very closely with our beef producers to access the Growing Forward program because, for many of them, unless you're an accountant or you have someone with some expertise, it's very difficult to wade through the pages of information.

Our producers access the Growing Forward programs AgriInvest, AgriStability, and AgriInsurance. It's mandatory for any producer applying for APP to be enrolled with AgriStability, of course. Producers submit their applications for AgriInvest and AgriStability each year with their income tax returns, so individuals have to go to Surrey, British Columbia, to the Canada Revenue Agency office, and corporations go all the way to Winnipeg to the office there. In most cases, again, accountants are preparing the schedule A's.

Beef producers across Canada have faced extreme financial hardships over the last eight years, starting with BSE in 2003. This was a major disaster for the cattle industry. We have lost a lot of our producers in British Columbia—B.C.'s cattle herd has been reduced by 35%, the highest percentage in any part of Canada—and our cattle numbers have decreased by 15% across the country.

The Growing Forward program was designed to provide financial assistance to producers in years when their income declined. The producers' reference margin was determined by an Olympic average of the previous five years—drop the high and the low and average the remaining three. Negative margin coverage is available up to 60% if the producer had two of three positive years under reference margin calculations. After year after year of declining incomes, a lot of our B.C. producers are receiving no financial assistance, as they now have only negative margins in their reference margin calculation. Changes need to be made to this program to provide protection for producers if this type of catastrophe were to happen again in the future, or producers were to margin declines in excess of three years.

Producers make annual contributions to their AgriInvest account based on 1.5% of their allowable net sales, with a matching contribution from the provincial and federal governments. They calculate it from the their AgriInvest and AgriStability applications. Producers who have negative net sales due to an income decline are not eligible to make an investment in their AgriInvest account and receive no matching funds.

In 2011, cattle prices have increased substantially for our producers. If these prices continue for the next few years, producers will once again have positive reference year margins. However, to protect these producers from future margin declines, changes need to be made to the program structure of AgriInvest and AgriStability.

We have some suggestions to increase the percentage of ANS in the AgriInvest program to at least 3%. Any negative reference year margin calculation should be changed to zero, with the zero figure being used in the calculation. This would ensure a positive reference margin for producers.

During the good years, with a strong market, producers do not need the program. It's for the years of poor consecutive markets for cattle producers that we need access to the program with the assurance of a positive reference year margin.

BRM program payments should be allocated to the program year in which they occur in AgriStability. For example, if a producer receives an AgriStability payment for the 2008 year and receives it in 2010, the payment is added to allowable income in the AgriStability program for the year 2010. In all cases, program assistance needs to be allocated to the year that triggered the payment. This works best for us. If producers suffered a margin decline in 2010, this 2008 AgriStability payment would effectively reduce or eliminate any potential payment they may have received in 2010, the net result being that the producer may only receive a one-year payment when there were two years of poor margins.

AgriInsurance crop insurance is another BRM program that is used by our B.C. producers. The program provides producers protection for their crop yield. In B.C., we have had several drought years in the last 10 years. In addition, many areas of B.C. face severe wildlife damage to their crops, which can drastically reduce their crop yield. The probable crop yield offered to a producer on his or her crops through AgriInsurance is based on a producer's 10-year average production. With drought and wildlife damage, a producer's average production is seriously affected. In B.C., this program is not very well subscribed to, with only 15% of the producers who are raising crops accessing it. A lot of our producers are saying it's just not worth it any more, that their production yields on AgriInsurance have been reduced so much.

If a producer has continued drought or wildlife damage, they will claim themselves right out of the program. Positive changes that could help producers with this program are a producer-based production level, as opposed to a 10-year producer production average needing to be established on an individual producer level. This type of change would provide protection to producers who find themselves in a claim situation for drought, flooding, or wildlife damage, without adversely affecting their future production guarantee.

The federal-provincial BRM programs play a very important part in agriculture, and for the stability of our cattle ranchers when we have a tough year with cattle markets and the weather. The program needs to be structured in such a way to ensure protection in the year needed and that any payments be allocated to the year applied for.

The cattle industry in B.C. and in our country took a huge hit due to BSE in 2003. We are now rebuilding a mother cow herd, with the first real retention of heifer cows this fall. The BRM programs aid in the rebuilding process and encourage young people to enter our industry. We need to protect our cattle producers for the raising of forage cattle and the ability to market our product at fair market value.

Thanks so much for listening to me, and I welcome your questions.

[The Chair, Conservative, Larry Miller]

Okay, thank you very much.

We'll now move into questioning.

Mr. Atamanenko, you have five minutes.

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

Thank you very much to all of you for being here. It's good to see you again.

Ray, I haven't seen you for a while. The first question is for you in Saskatchewan. We talk about the various programs, including AgriStability and AgriInvest, and reviewing those. I remember when I was first elected in 2006, one of the first case works that we had to touch upon was the flooding in Saskatchewan, of the Porcupine I think it was, and then also the drought.

It seemed at that time that everything was really slow getting off the ground. Here you had both levels of government, senior and federal, neither wishing to start. I'm not really sure what the final result was, whether farmers were adequately compensated or not. I'm assuming that things have improved, that there's a better system in place now. I'm wondering if you would comment specifically on these programs. Here we have a serious flood, farmers lose money, and what happens? How does this kick in from your experience?

[Ray Orb]

You're referring to the timeliness, I guess. There are a number of things that would have to happen. I know that provincially, the crop insurance has to assess the damage. I think they then report back and the federal government then has to.... The province has to actually declare a disaster, and then the federal government looks at it.

I think it's better now than it was. I referred back to 2006 in my presentation when the program was still a little shaky. There were producers in the southwest part of the province, as I mentioned, who went for at least four, maybe five years.... They actually were dried out. They had no feed at all for their cattle and somehow this program didn't kick in.

I think the program's timeliness is better. We're still looking for a better definition, and maybe something more timely then, because of the fact, as far as a grain farmer or a cattle farmer is concerned, they don't actually have any production that year. If you don't have any grain carryover, you really have nothing to live on. I know sometimes senior governments don't understand that message, but when you're a farmer and you have bill collectors, it gets to be very stressful and I think we need to have a program that kicks in.

AgriStability doesn't really deal with that, because it's always a year behind. I know there have been cases where advance payments were made through AgriStability, and some things happen during the year where you did have some land that did have some crop. While that's so much better for the farmer, the farmers then have to pay the money back, and farmers don't like to put themselves in that situation because it causes more instability.

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

Thank you.

Does anybody else have any comments on this. Ms. Patterson, Mr. Brennan, Monsieur Béland?

Ms. Patterson.

[Connie Patterson]

No, I think he covered it very well.

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

You talked about drought, Ms. Patterson, and BRM program aid in your building. I'm wondering if you could go into a few more specifics as to, from your experience, how it's worked really well and what are some of the improvements that can be made.

[Connie Patterson]

In the rebuilding process of our industry, you mean?

The big thing for cattle producers is access to market our product at a fair market value, as well as to have some form of stability. One of the big things for us is the distance that many of us have to travel to a packing plant to be able to kill our livestock and get it ready for market. Therefore, it's really important that we have areas that look after the feed end of things so that we can finish our cattle more quickly, making sure that we have access to transit, killing plants, and feedlots. That's the big thing for British Columbia. We're out on the far side of the country.

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

Thank you.

Do I have any more time here, Mr. Chair?

[The Chair, Conservative, Larry Miller]

Yes, you do.

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

I'd like to discuss the topic of the reference margin, which is calculated using the Olympic average—in other words, the last five years of a producer's margin. Remove the highest and lowest margins within that time period and average the remaining three years. There's been a lot of criticism of this program, and I was wondering if you, Mr. Brennan, would have any specific ideas on this.