Evidence of meeting #20 for Agriculture and Agri-Food in the 41st Parliament, 1st session. (The original version is on Parliament’s site, as are the minutes.) The winning word was programs.
A recording is available from Parliament.
Conservative
Conservative
Joe Daniel Conservative Don Valley East, ON
Thank you, Mr. Chair. Thank you, gentlemen, for being here.
I have absolutely no background in agriculture, so this question may be completely off the wall. From what I've heard so far, all the talk has been about selling product, whether beef, cattle, grains, etc. Is there any thought being put into selling services? Clearly, to manage your businesses, etc., you have a huge amount of skill.
The question comes from an inquiry I had from India, where they're having trouble with milk. I thought it was the production of milk, but it's not the production of milk; it's the ability to be able to store it and deliver it in a correct way. The milk goes off before they get it to the people who need it. But these are the sorts of skills the industries must have here, because milk is plentiful here and there's never a problem.
The question is more a general one to all of you. Have you considered skills that can be sold abroad, anywhere else, and a mentorship-type program that will actually reduce the risk to other farmers?
Member, Atlantic Grains Council
Mr. Chairman, I can chime in on that one quickly.
There are a number of examples of schools of expertise that have been offered in the past. One that comes to mind in Atlantic Canada is an international potato school. You take expertise and equipment to Russia and help develop their potato industry. Technology transfer tours.... There are a number of these kinds of examples that have gone on in the past.
Conservative
Second Vice-President, Canadian Federation of Agriculture
When we offer education programs here, we do not limit them to Canadian students. It's important for us to continue to develop education programs to train the people we will need in the future.
Our organization, through Wild Rose, has sent people over to Russia to help them manage certain things. I'm sure the cattle industry has and that everybody else has. We've been invited over. We're very sharing with the technology we have.
But one of the biggest things we can do is to ensure that we in Canada continue to have a huge educational...with agricultural people involved. We can train both our people and the people from around the world who want to learn. It's a valued education they can use anywhere.
Conservative
Joe Daniel Conservative Don Valley East, ON
Coming from an engineering background, I was thinking more in terms of getting revenue for consulting, whether you can actually sell that as a service to foreign countries across the globe, particularly during the harsh winters when they perhaps don't have as much to do, when you can actually make some money on this, reduce your risk, and improve your margins.
Executive Director, National Farmers Union
Canadian farmers are phenomenal business people. They're also phenomenal stewards of the land, and they also know a lot about raising animals and crops and whatnot. Some of our members have found success in actually inviting urban people out to their farms to witness the farming practice and gain an appreciation for the land and the production process. They're also going into the cities. We're in a society where we don't have many people growing their own food, and having that appreciation for that process.... So we've had members of our organization actually participating in those kinds of programs and doing quite well for themselves, and promoting their farm in the process.
President, Canadian Cattlemen's Association
I guess my response to that would be that this in fact does happen, certainly in very specific situations, but we do have a lot of expertise in agriculture, and certainly in the cattle industry in Canada. There are some who consult internationally and do quite well at it. We also sell genetics globally. Canada has world-class cattle genetics, and we sell them around the world. Along with that is often some expertise to accompany the sale of those genetics. So that is taking place.
Conservative
Joe Daniel Conservative Don Valley East, ON
So you are making money on these services you're providing.
Conservative
Pierre Lemieux Conservative Glengarry—Prescott—Russell, ON
Thanks, Chair.
I want to just go back to the insurance-based programs. I say that because we've had lots of good discussion here in committee about insurance-based programs. Also, Allan Ling made a comment that, from his point of view, that's the number one program, followed by others.
Travis, you were talking about an insurance-type program for the livestock sector. It can be a bit confusing because there are insurance-based programs and then there are cost-of-production-based programs, which are completely different. They're easily confused if they're not well explained.
I'm wondering if you could first explain to the committee this insurance-based program for livestock. How does it work exactly? What would a farmer do? What's he insuring himself against?
December 15th, 2011 / 5:10 p.m.
President, Canadian Cattlemen's Association
That's a great question. There's some confusion out there among farmers as this program has been discussed, as well. The cattle price insurance, which is certainly the one I was referring to, is an insurance program where producers can basically, for a premium, lock in a price based on an index. The index is based on expected future prices that are found through the CME in Chicago and from historical basis levels for that time of year. It is completely market-driven, and it is not based on the cost of production at all. So market signals will not be muted at all with the implementation of this program. However, it will be a very effective risk management tool for producers to use.
Conservative
Pierre Lemieux Conservative Glengarry—Prescott—Russell, ON
So the farmer can insure himself to a certain percentage of what the futures are telling him?
Conservative
Conservative
Pierre Lemieux Conservative Glengarry—Prescott—Russell, ON
Then the cost of his insurance goes up if he wants to insure to 80% or 90%—or less if it's 60%?
Conservative
Pierre Lemieux Conservative Glengarry—Prescott—Russell, ON
Do you know what the brackets are? Are you able to share proposed brackets?
President, Canadian Cattlemen's Association
Ryder can maybe assist with that. I believe the top tier is up to 95%.
Ryder Lee Manager, Federal Provincial Relations, Canadian Cattlemen's Association
Yes, and it comes out three times a week. So with what's available at what price, you've got to be very active in there, looking at it and saying, “Well, this week the market went this way.” Next week, all of a sudden it might be much more attractive or much less attractive to buy coverage for your animals.
