Thank you, Mr. Chair.
Honourable members of the Standing Committee on Agriculture and Agri-Food, on behalf of the Canadian Produce Marketing Association, I would like to thank you for the opportunity to speak to you today.
Some in the committee will know the CPMA from other events, like Horticulture for Health, but for those of you who do not know the Canadian Produce Marketing Association, we represent a fresh fruit and vegetable industry valued at over $9 billion in Canada. CPMA is a not-for-profit association that has represented the interests of the fresh fruit and vegetable trade in Canada for the past 87 years. Representing a vertically integrated supply chain, we support the needs and interests of member companies from farm gate to dinner plate. In short, the association includes grower-shippers, food retailers, food service operators, and most everyone else in between. As an example, members include the P.E.I. Potato Board, B.C. Tree Fruits, Loblaws, Metro, Sysco, and Gordon Food Service.
Within a membership of over 770 companies, CPMA represents the interests of 456 Canadian companies, including over 150 Canadian grower-shipper-packers. This diversified Canadian membership provides CPMA with a unique perspective of the issues and challenges facing the Canadian food system, domestically and internationally, on the primary production and market levels.
Recognizing that the committee is seeking information pertaining to two core areas, I hope to be able to provide some insight from the perspective of the fresh fruit and vegetable supply chain and food system in Canada, by looking specifically at how industry, government, and a range of diversified stakeholders and sectors need to converge to create a model that will allow Canadian companies involved in fresh fruit and vegetable production and sales to grow into the future.
The fresh produce business moves at a very rapid pace. Given the perishable nature of the business, it's no surprise the industry’s mantra is “sell it or smell it”. This reality adds to the complexity of the marketplace and the nature of how produce is sold and marketed. Some suggest that while investments by the provincial and federal governments in development programs are a part of the economic engine supporting our industry, we feel they aren't the key, but they are definitely the spark plug.
The fresh produce industry in Canada enjoys the benefit of a strong export and import market with our closest trading partner, the United States. Canada exports over $4 billion of fresh produce annually to the U.S. and imports approximately $7 billion worth. The successful importing and exporting of fresh produce relies heavily on the integrity of the Canadian regulatory system and policy tools that support our market. Effective regulations protect our health, safety, and the environment, while supporting growth, investment, innovation, and market openness.
As the North American market is extremely significant to the fresh fruit and vegetable sector, we are very pleased with the work currently under way by the Regulatory Cooperation Council. The RCC is an excellent example of how the federal government can support industry, potentially expand market opportunities through enhancing existing mechanisms, and foster cooperation in the design of regulations to ensure alignment in their implementation or enforcement. While this approach on a bilateral level with the U.S. is encouraging, we must also look inward on a domestic level to ensure consistent application and interpretation of existing tools, such as plant health regulations and others, to ensure the competitiveness of the domestic industry.
CPMA welcomed many of the recommendations from the Red Tape Reduction Commission report, and underscores the need to ensure that unnecessary or burdensome regulations do not negatively impact the competitiveness of the industry. It is also crucial that government departments ensure solutions developed for one commodity are not automatically assumed to be the best solution for all.
Traceability and the introduction of sustainable packaging, such as returnable plastic containers, or RPCs, are examples of innovation in the produce industry. Traceability supports the continued safety of food, while RPC utilization in produce—much like previous implementation in milk and meat crates for distribution—supports a sustainable delivery of produce from grower-packers to the distribution centres of both food retailers and food distributors. It is crucial that industry and government collaborate to address any existing or emerging regulations or policy that might negatively impact an industry's ability to deliver on innovations such as these. As an example, something is currently happening in Canada with RPCs at the CFIA level.
The fresh fruit and vegetable sector in Canada has not realized its full potential on the domestic and international level. There are many lost opportunities due to the complexities of the global marketplace and the lack of alignment between the supply chain, related policies, regulations, and gaps within an overall food system approach, which includes many intersecting stakeholders working beyond a linear sector model.
The Canadian Agri-Food Policy Institute identified that:
The issues and solutions affecting the sector are cross-cutting and increasingly complex, including those relating to reliable food production and supply, trade and market access, diet, nutrition and population health, and environmental sustainability and climate change adaptation. Positioning the country for future success depends on wisely managing these issues. Doing so requires changing the way we link broad food issues and connect agri-food and other stakeholders. It’s about adopting “food systems thinking’”.
As the report stated:
We need to stop talking only about sectors, value chains and product lines and start thinking more about agri-food “systems”. Future success hinges on taking a systems approach that better understands the connections among many diverse players [within the marketplace].
The produce industry has functioned within a vertically integrated supply chain for many years. Moving perishable products like fruit and vegetables required a chain to leverage partnerships and collaboration within a competitive and complex food systems approach. This system has included the traditional supply chain partners and has begun to expand beyond adjacent sectors, such as research, health, transportation, environment, food security, and beyond.
An example of this approach can be found in the recent development and launch of the produce transportation guidelines, which were created with cross-sector partners from Canada and the United States to address common issues and improve competitiveness within the marketplace.
Additionally, the produce industry has grappled with a range of challenges such as extreme variances in input costs compared to those of international markets, as we heard from the previous speaker; lack of tools to support regulatory requirements, and the lack of private funding to support needed market information, research, and innovation. To address these challenges, we recognize the opportunity to build upon existing successes, such as those of the RCC; to develop food systems within the produce industry, which will bring together intersecting sectors; and to improve research and competitiveness within the industry with our government partners.
The current provincial and federal government programs for fresh fruit and vegetables, which support public-private partnerships such as programs funded by the regional adaptation council and the work under way with the Vineland Research Station are examples of models that should be expanded. As the produce industry is made up of many small to medium-sized companies, there are limited private funds available to invest in areas that could be considered expendable or optional, even though they are essential to market growth.
As an example, tools such as single ingredient data to support fresh fruit and vegetable nutrition labelling in Canada are required and are unfortunately cost-prohibitive for many small growers. CPMA is working with Health Canada and Agriculture and Agri-Food Canada to develop a top 20 list for industry.
Understanding market demand and trends is also vital as consumer needs and market opportunity are evolutionary within our social media environment. An example of work under way includes research in Ontario focused on planting and testing new ethnic vegetable varieties to meet the changing Canadian demand. This research is being conducted in conjunction with researchers, growers, and retailers to develop and test products, an example of a true food system.
Other projects include taste profiles. Taste is fundamental to selling more fresh fruit and vegetables. Growing good-tasting product is key. Breeding programs and consumer testing with peaches that are grown not only to meet consumer demand with regard to size and colour but also to offer the right taste profile to address consumer preferences are fundamental. Funding to support this research is needed. Research to develop a plum with the highest level of antioxidants of any plum in the market is another activity going on in Ontario. Across Canada, additional research supports innovation and enhancements in produce cultivation and production. It is crucial that all of this work continue.
This integrated supply chain model and developing food system can be seen every day in the fresh produce industry. They rely on policies and regulations that allow for the ease of trade and the reduction of barriers to get fresh fruit and vegetables to the consumer. The rule of “sell it or smell it” can govern many decisions within our supply chain. As noted, the lack of aligned or harmonized policies and regulations can dramatically impact the marketing and trade of fresh fruit and vegetables.
As we begin to see urban centres across Canada becoming more actively engaged in the development of a food strategy to ensure a sustainable food supply within their municipalities, we need to work proactively towards a whole-food system approach, which requires aligned policy development to support a cross-section of sectors and, in the end, produce safe, healthy food for Canadians.
The balance between our domestic import and export markets is vital. While we see a great emphasis on developing our “buy local” programs, it's important to recognize that we must work in synergy with the year-round supply of produce that all Canadians enjoy.
Our end goal is a produce supply chain that is delivered to consumers in a safe way. Industry and government play a key role in this goal. As part of the whole-food system, the produce industry recognizes the need to work collaboratively to support the availability of produce and to bring innovative products to market.