Evidence of meeting #22 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 market.
A recording is available from Parliament.
5 p.m.
NDP
Jean Rousseau NDP Compton—Stanstead, QC
If we could succeed in one of these fields, could we have an advantage in the international market?
5:05 p.m.
Associate Professor, International Relations Officer, Department of Plant Agriculture, University of Guelph
Absolutely. The cost advantage alone is huge, besides appealing to people who drive Priuses, in terms of its low.... It's striving towards the movement. The terminology I really like a great deal is “ecological agriculture”.
5:05 p.m.
Professor, Department of Resource Economics and Environmental Sociology, University of Alberta
I'll make one comment about drought-tolerant crops, and it relates to research that's been done before. I actually have a grad student dealing with marker-assisted research into drought-tolerant crops and GM crops. One of the things we get out of this, which we often get out of returns to research studies, is that when you have a relatively large increase in production without a corresponding reduction in cost--and in these cases you wouldn't have a reduction in cost--then when prices go down sufficiently, the effect at the end of the day is that producers end up losing money or not being any better off. The ones who come in as first movers take advantage of the situation, but the majority of the sector do not.
With regard to a lot of these technological innovations, I would caution you that you have to think very carefully about what they will do at the end of the day with respect to price impacts.
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Conservative
The Chair Conservative Larry Miller
Well, you're a little over. If you have a quick comment or something, I'll allow it.
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NDP
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Conservative
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Conservative
Pierre Lemieux Conservative Glengarry—Prescott—Russell, ON
Thank you, Chair.
I want to follow up on the marketing theme.
Dr. Rude, in the materials you handed out to the committee you highlighted the market information and export capacity-building components of Growing Forward, which has been roughly $20 million to $25 million a year over the last couple of years. You made the comment that it's very hard to measure the impact of these programs empirically. I think you're right; it is.
I was in Japan when access for Canadian beef was blocked due to BSE, and Australian beef moved in. One of the people I was talking to in Japan, who lives in Japan, was saying the slogan had become “Aussie beef”. That's what many Japanese associate with beef now; it's “Aussie beef”. I thought, “There's a branding going on right there”. It's a bit like the way we brand Angus beef here in Canada. There are all sorts of different beef, but Angus beef has just been marketed that way, and it actually means something to the consumer.
I think it would be good if we could empirically measure whether this Canada branding program is working, how much it's working, etc., but it would also entail spending money on the parameters we would want to measure.
In your experience, have you received positive or negative comments on the Canada-brand branding exercises that we do or initiatives that we launch in other countries? Do you think some of that money should be spent on measuring whether or not it's having an impact and what kind of impact it might be having, or do you think we should go with the assumption that the feedback is positive, so we should just continue in that way?
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Professor, Department of Resource Economics and Environmental Sociology, University of Alberta
I think it's a little difficult to exactly price out what covers the Canada brand. I think you also have the AgriFlexibilityfund. It is half a billion dollars, right? I think that because there are partnerships with provincial governments and partnerships with private firms as well, trying to figure out this complex web of where the money is going and trying to determine exactly what happened is very difficult.
Derek Brewin earlier described some research done by John Cranfield on the producer check-off in the beef sector. There actually has been some research done on that sector. If you're interested, I can give you John's study.
In terms of the Japanese market, I think we have to be a little bit careful. If you go back to earlier than BSE, back to the point when the Japanese first opened up their market, the Australians got much more headway in the Japanese market. It was largely because of Japanese investment in Australia and the locational advantages. We tried to produce wagyu beef here at the time, but we didn't do a very good job of it. The Australians had the advantage in terms of the foreign direct investment that took place in their market.
They also have an advantage in terms of climate. You can have grass-fed beef. If you're worried about hormones or you're worried about BSE getting in through the protein additives, they naturally have an advantage.
5:10 p.m.
Conservative
Pierre Lemieux Conservative Glengarry—Prescott—Russell, ON
All right.
From a marketing point of view, I'm wondering about the fact that success or impact is very difficult to measure empirically. Are you proposing that money be spent to measure it empirically, or are you proposing that this is just a shortfall in our investment in branding but that branding works anyway?
5:10 p.m.
Professor, Department of Resource Economics and Environmental Sociology, University of Alberta
The Australians spend considerably more. I'm not certain what the order of magnitude is, but it's very substantial. They've been in this business for quite a while. At the same time, they are not focusing so much on national brands, as we are. I think we've sort of hung our wagon to the star of a Canada brand. I think we have to be a little bit careful about that. I think you need the flexibility to be able to respond to individual market situations.
With a Canada brand, you are dealing with everything that's out there and you're expecting a very blunt instrument to deal with every contingency.
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Conservative
Pierre Lemieux Conservative Glengarry—Prescott—Russell, ON
What would you propose as a more precise instrument?
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Professor, Department of Resource Economics and Environmental Sociology, University of Alberta
I think I'd probably increase the funding that goes to the individual industries. You continue the types of partnerships you've had. Possibly you continue on with the Canada brand, but at the same time I think you need to study it a little bit. You face the risk that if something goes seriously wrong, where once you had a Canada brand that was positive, suddenly it's a Canada brand that is negative.
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Conservative
Pierre Lemieux Conservative Glengarry—Prescott—Russell, ON
Right. Does someone else want to add anything, because I'm going to run out of time?
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Associate Professor, Department of Agribusiness and Agricultural Economics, University of Manitoba
I just want to make a quick point. For one thing, I think the pork consumers said that sometimes having the Canadian name on the brand was negative. The other thing is that we can ask the consumers about the brands that matter. I think that if you ask the grain industry, they'll say the Certificate Final for an export in Canada is worth something. You want to protect the Canadian Grain Commission's ability to keep that Certificate Final there. Maybe ask the consumers about this brand.
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Professor, Department of Resource Economics and Environmental Sociology, University of Alberta
That's one thing CIGI does in its role. Its consumers are a lot easier to identify; they are wheat millers across the world. They offer training sessions. They bring in people for big drunks.
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Voices
Oh, oh!
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A voice
Why are you looking at me?
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Professor, Department of Resource Economics and Environmental Sociology, University of Alberta
No, I was actually looking at Derek.
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Voices
Oh, oh!
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Professor, Department of Resource Economics and Environmental Sociology, University of Alberta
It's one sector in which it's easier to target and identify who the consumers are. As you get into broader processed products, it's very difficult to target exactly who they are.
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Conservative
The Chair Conservative Larry Miller
Thank you.
Mr. Brewin, I'd like clarification on something you said. You said that a buddy of yours in pork--
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Associate Professor, Department of Agribusiness and Agricultural Economics, University of Manitoba
I think I was listening to testimony at this committee. A pork producer was mentioning in relation to country-of-origin labelling that being Canadian in the U.S. market was considered a negative.
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Associate Professor, Department of Agribusiness and Agricultural Economics, University of Manitoba
No.