Evidence of meeting #27 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 need.
A recording is available from Parliament.
February 29th, 2012 / 3:30 p.m.
Conservative
The Chair Conservative Larry Miller
I call the meeting to order.
I'd like to thank our three witnesses for being here today. I very much appreciate it.
This is our final meeting on Growing Forward 2 and our final category in that study, which is meeting consumer demands.
First of all, from the Alberta Food Processors Association, we have Mr. Ted Johnston. Please try to keep your presentation to 10 minutes, sir.
Ted Johnston President and Chief Executive Officer, Alberta Food Processors Association
That's the hardest thing of all, Mr. Chairman.
Conservative
President and Chief Executive Officer, Alberta Food Processors Association
For the committee's record, I've also been the industry co-chair of the Agriculture Canada value chain round table for food processing in Canada.
I'm going to address some of these remarks from a national perspective, and I will tie them together in terms of Growing Forward 1 and Growing Forward 2. We could go back to the APF if you want to talk about these things and how the transitions have not worked terribly well.
Canadian consumers have pretty simple wants. They want tasty, nutritious, and safe food at an affordable price, and they have definitely expressed a preference for Canadian food products. There's a little bit of nationalism tied into that. The Canada brand group out of Agriculture Canada have done some study. They did a beautiful virtual store study. If you ever get a chance, have a look at it. It indicates clearly that Canadians prefer Canadian product as long as it's priced competitively with other products from around the world, and that horizon is at about the 10% level, so we have a problem with “Product of Canada” in this country, and I'll talk about that in a few more minutes.
Safety is an expectation of consumers. It is not a marketing issue. It is not something that you can go out and sell. I used to be the president of the Superstore division of Loblaw companies, and I can tell you I never had a customer walk in, stand in an aisle, look up and down, and say, “What's not safe?”. It was all safe, and it bloody well better be.
I'm speaking to you today on how the government needs to recognize the Canadian consumer through its next five-year federal-provincial policy agreement, which we refer to as Growing Forward 2.
Growing Forward 1 and the previous five-year program before that, APF, were focused primarily on primary agriculture, with little or no focus on processing. Unfortunately, the current minister expresses no interest in the processing side of his department. He repeatedly states his position as “farmers first”, and this is reflected in the focus of the department, although it has improved somewhat since 2009 with the previous Minister of State for Agriculture getting involved with us.
Progress was made when we formed the Food Processors Competitiveness Working Group in 2008. The previous Minister of State, the Honourable Jean-Pierre Blackburn, took an interest in leading the creation of the round table and the development of growing the Canadian food processing sector. An industry-government action plan was announced by Minister Blackburn on January 24, 2011. That action plan is available on the Agriculture Canada website. There were 36 action items in it dealing with economics, market access, R and D and innovation, and regulatory reform.
What has that got to do with consumers? I'm going to show you very clearly that it has a great deal to do with consumers.
First is a little bit of background. You may or may not be aware that food processing is the largest manufacturing industry in Canada. It represents $89 billion of economic output, but that's down from $94 billion just three years ago, and that erosion is one of the things that's going to negatively affect consumers and one of the things we have to address in policy.
Food sales to Canadian consumers are about $160 billion. Two-thirds of that comes through retail; one-third comes through food service.
Food processing is the largest manufacturing employer in Canada, currently employing approximately 270,000 Canadians directly, and if you add in the goods and services and ancillary operations, it's pretty close to a million Canadians out of our workforce of 20 million. However, that number is down from 305,000, again, just four short years ago. We've had 58 significant plant closures over that four-year period. I can point out too, and I will, how that is negatively affecting consumers and why we need to address that issue in Growing Forward 2.
Industry currently supplies 77% of the processed food and beverage products available in Canada. Industry currently purchases 40% of all Canadian agricultural outputs. The number is higher in the livestock sections, where it's 65% to 68% in beef and pork, particularly.
There are 6,400 food and beverage establishments in Canada, with the concentration in Ontario, Quebec, B.C., and Alberta, but 90% of those are SMEs, meaning fewer than 100 employees, and 29% of them have 5 or fewer employees. The large establishments make up less than 5% of the plants, but they process 50% of the output, and we have some policy issues related to those statistics that I hope will be addressed in Growing Forward 1 and Growing Forward 2.
In Canada, 60% of the food processing facilities are domestically owned, but this is a shrinking number.
Probably one of the things that would surprise a lot of Canadians is that McCain doesn't actually have a Canadian president anymore. The Canadian operations report to a U.S. president in Chicago.
The industry is increasingly dominated by a few companies. The largest 50 account for 60% of all food production in Canada. Meat accounts for 27% of the output. That rose 9% in 2010 as beef got into some other markets again. That is versus 2% for the total industry, but, if you do the math very quickly, you'll find out that the entire increase in the total industry came because of the weighted average of beef. As beef goes, so has gone the industry over the last few years. There's been no real growth. Shipment increases have merely paralleled the Canadian population growth over the last five-year horizon.
The part that probably impacts consumers the most—and there are a number of policy issues to be dealt with on this—is on the import side. In 2010 we imported $21 billion of food into this country. In 2004 we had a positive trade balance of $5 billion; in 2009 we were negative $1.9 billion. In a five-year horizon we had a $7 billion shift, and not in the right direction. In 2010 it came back a bit because of the beef; we were $300 million negative. In 2004 we were the number three food-exporting nation in the world; in 2009 we had slipped to number nine. In 2010, with the beef back, we managed to wiggle our way back up to number seven.
The high Canadian dollar is weakening our exports to the U.S. It's encouraging U.S. companies to close Canadian branch plants, and those are a big part of the 58 plants that have gone. Our trade balance, although it's positive, is still way below the $6 billion with the U.S. that we had in 2004.
There are a number of reasons. I refer you, if you haven't looked at it, to the study by the George Morris Centre that indicates that the Canadian processing industry is 40% less productive than the U.S. on average. They updated that study in 2005. The reasons are primarily high wage and benefit costs, lower levels of automation, and outdated facilities.
What does all this have to do with consumers and Growing Forward 2? Canadian consumers believe, and rightly so, that food grown and processed in Canada delivers precisely what they demand. There is a high degree of certainty about safety, it's nutritious and tasty, and it supports the Canadian economy. Even though they may not articulate it clearly, it's my belief that if Canadian consumers were aware of the continuing threat to their domestic food supply and therefore to food security, they would insist that the Government of Canada take strong affirmative action to retain and renew this vital industry for the benefit of all Canadians. Government policy needs to change, and it begins with Growing Forward 2.
I'm going to give you a few of the issues that need to be addressed through federal policy.
The first and foremost issue that's causing the erosion of this industry in this country, and thereby causing the replacement of domestic product with import product for our Canadian consumer, is simply the lack of access to affordable capital. This capital is required in terms of improving our productivity, automating, modernizing, and getting competitive with the rest of the world. We had the benefit of being behind a 60¢ dollar, and even up to an 85¢ dollar. We were competitive in world markets and domestic markets at those kinds of currency exchange rates. At a $1 dollar we are not competitive, and we continue to lose share to the United States.
I'll talk more about safety standards, if the chairman doesn't give me the boot, because there are some very scary things happening on the food safety side. There was a test case done out of Growing Forward 1.
Here's one of the policy issues. There was a $500 million fund, AgriFlex, that was part of Growing Forward 1. They took $50 million of that and put it into what they call the API, the AgriProcessing Initiative, which was to put a loan program in place. It had a $2 million cap as an interest-free loan, to be paid back over seven years with a first year holiday, so it was an eight-year period. That program has pretty much all been distributed, and we're just starting to see the results come back from it. That was a good experiment in terms of what could be done and how we might address these issues, but $2 million, I can assure you, in a plant of any consequence, has almost no impact whatsoever. The number is far too small, as is $50 million.
I'm suggesting that we need to address that issue in Growing Forward 2. We have the test case in Growing Forward 1; in Growing Forward 2, we need to address that particular policy, we need a direction, and we need to make some very strong changes.
On food safety standards, there were a number of things done in Growing Forward 1 in terms of improving or supporting food safety in Canada. The difficulty is that we are basically facing five different standards that food manufacturers try to meet in this country.
One would consider the Canadian Food Inspection Agency and its standard to be top of the list. Unfortunately, it is closer to the bottom. Although a federally inspected plant must meet those standards and any inspector from CFIA can come in and shut down your plant with no recourse—there is no ombudsman, no way to get this turned around quickly—even when you comply, it doesn't necessarily mean you're going to be able to sell domestically or to a foreign market. The export certificates are not recognized in most markets. We're in the middle of this discussion with the European Union, and they send their own inspectors over here. They couldn't care less what CFIA says in terms of the export certificate.
Turning to Loblaws, you had better have a BRC standard if you want to sell to Loblaws. That is over and above what the CFIA standard is, and it requires equipment and plant changes. If you want to sell to Walmart, you need SQF. That's different again, so heaven help the poor manufacturer who is trying to supply two or even three different customers who have three different standards they have to achieve.
For the product approval process, there was money taken from Growing Forward 1 to support Health Canada to streamline the product approval process. If we want to see innovation and development of new product in Canada, we need to take a stronger approach to that aspect. Some improvement was made, but we are still extremely slow.
On market access, current programs in Growing Forward 1 are focused primarily on primary agriculture. There's a small program there to support the processing sector, but it's aimed at small manufacturers and it's a very limited program. In Growing Forward 2, we need to see that program expanded, and we need to include the larger manufacturers, because that's where you get the best bang for the buck, and there are going to be more purchases from Canadian farmers.
One that you're probably sick of hearing about—we addressed this committee many years ago on this subject—is “Product of Canada”. For all practical purposes, the 98% guideline has resulted in the removal of “Product of Canada” from Canadian manufactured food products. We are in the process right now of seeing more and more American products show up. The Canadian product is not identified. The American product is—with 51% U.S. content—so they now have the advantage. If the consumer looks at it and can't determine if it's a Canadian product, well, the next best thing is to get something from the United States, something that at least it is not coming from Southeast Asia.
Canadian manufacturers are at another disadvantage there. This 98% guideline flew in the face of this standing committee's recommendation that 85% was the right thing to do, and we still have a problem with it.
Conservative
President and Chief Executive Officer, Alberta Food Processors Association
You have been, and I thank you very kindly for that. I suspect that in the questions I'll be able to finish it, so I can wrap it up there, if you wish.
Conservative
The Chair Conservative Larry Miller
Okay. Thank you very much.
From Bioniche Life Sciences, we have Mr. Culbert. You have 10 minutes or less, please.
Rick Culbert President, Food Safety Division, Bioniche Life Sciences Inc.
Chairman Miller, committee members, and guests, thank you for allowing me this chance to discuss with you what we see as a great opportunity to make Canada a leader in public health and in on-farm food safety, and in doing so, to meet the demands of consumers for safe food.
My name is Rick Culbert, and I am the president of Bioniche Food Safety, a division of Bioniche Life Sciences. Bioniche is a small to medium-sized Canadian company based in Belleville, Ontario. We employ 225 people and are actively growing. Our food safety division was specifically created in recognition of the growing importance consumers place on food safety. In many ways, this food safety division is the interface between the other two divisions of Bioniche, those being our human health and animal health divisions.
As a research-based, technology-driven Canadian biopharmaceutical company, we are committed to discovering, developing, manufacturing, and marketing innovative products for human and animal health worldwide. To that end, in collaboration with the University of British Columbia, the Alberta Research Council, and the University of Saskatchewan, Bioniche has developed a globally recognized and fully licensed product to enhance food safety for consumers.
A generation ago we had not heard of E. coli 0157, but this deadly strain of bacteria is a food- and water-borne illness that poses serious health risks for Canadians. It infects an estimated 26,000 Canadians every year, is linked to a higher rate of chronic illnesses, and is potentially fatal. This strain of E. coli is infamously linked with the tragedy in Walkerton, Ontario, where seven people lost their lives and thousands more fell ill after the town's drinking water became contaminated.
In the United States E. coli 0157 contaminated spinach; the cost was an estimated $2 billion. What most consumers don't know is that there, as with Walkerton, the source of the outbreak was linked to cattle. Most consumers also don't know that globally, wherever there are cattle, there is associated human illness due to E. coli 0157.
Researchers have repeatedly identified domestic cattle as the primary reservoir or source of E. coli 0157. Cattle are able to harbour this particular strain of bacteria in their intestines with no ill consequences to them; however, when it's passed into the environment and either enters groundwater or comes into contact with food, it can kill people, and it has.
Although the illness was originally called “hamburger disease”, more consumers now become ill from fresh produce contaminated by E. coli 0157 than from ground beef. Walkerton was 12 years ago, yet human illness and food recalls due to this pathogen have occurred as recently as two weeks ago here in Canada. Despite the existing inspection system and controls currently in place, E. coli 0157 illness and related food recalls continue to hit the media.
In terms of how this links into meeting consumers' demands, Canadian consumers want and deserve to have confidence that the food they are feeding their families is safe. They deserve to have confidence that everything practical and reasonable is being done to ensure the safety of their food.
The good news is that we can do more to meet this consumer demand. We are now able to better ensure the safety of our food, thanks to the groundbreaking and innovative development I mentioned earlier.
A brilliant microbiologist by the name of Dr. Brett Finlay, who has been inducted into the Order of Canada, discovered a method by which an effective vaccine could be made to reduce shedding of E. coli 0157 by cattle. It's the world's first vaccine for this purpose. It's purely Canadian. It was developed with the aid and support of Canadian government research grants and loans, and it's a giant leap for this pressing public health issue.
At Bioniche we often characterize this as the first public health vaccine that's not administered to the public. As cattle develop no disease symptoms from this strain of E. coli, it's really not an animal health vaccine. This vaccine is not for the benefit of the cattle. However, by reducing the amount of E. coli 0157 that is shed by cattle into the environment, and thereby reducing the risk of E. coli 0157 contamination of groundwater, beef products, or produce, the vaccine is for the benefit of people.
The challenge we face is ensuring widespread use of the vaccine to better protect the health of the public, to expand markets for Canadian cattle farmers, and to strengthen consumer confidence in Canadian food safety. We are proposing the federal government fund a national voluntary vaccination program that allows farmers to access the vaccine at no charge through their veterinarians, and to have it administered as they routinely inoculate their animals against common cattle diseases.
Again, this isn't a vaccine to protect cattle. It's a vaccine to protect public health.
That reality makes it very difficult for beef and dairy farmers to justify the added cost of the vaccine. There's no system in place for retailers of ground beef to compensate cattlemen, as the supply chain for beef is very diverse and it's not integrated. There is similarly no system in place for the fresh produce industry to compensate cattlemen for this risk reduction step.
We understand that times of austerity are not the best times to ask government to consider a new spending program. However, we are in a unique position here in Canada, and the math makes sense. Canada is poised to take advantage of increasing world demand for food, and it will serve us well to adopt innovative on-farm food safety technologies to meet consumer demands.
The cost of the vaccine is $3 per dose. While it is unlikely that every farmer in Canada would participate in a voluntary program, the estimated annual cost to vaccinate all the cattle in Canada would be $50 million. For that investment, we would get stronger consumer confidence in Canadian food safety and a significant drop in the estimated $221 million primary and secondary annual health care costs associated with E. coli 0157; we'd get recognition of a Canadian innovation and the creation of high-tech Canadian jobs to manufacture the vaccine for a global market; we'd get a strong Canadian reputation as a leader in innovative public health interventions; and we'd also get the reputation of a global leader in on-farm food safety and in meeting consumer demands for safer food products.
E. coli 0157 is a persistent public health issue. We are presenting you with an opportunity to not only provide an economic boost through enhanced consumer confidence, but to also reduce illness, ease a growing burden on our health care system, and ultimately save lives.
Consumers are justifiably demanding safe and reliable food sources. They expect that all appropriate, necessary, and reasonable steps will be taken to ensure that Canadian food is safe for consumption. We are asking this committee to recommend the creation of a national voluntary E. coli 0157 vaccination program as a demonstration of Canada's ability to meet consumer demand for food safety, both locally and globally.
Thank you.
Conservative
The Chair Conservative Larry Miller
Thank you very much.
Finally, from Food Secure Canada, we have Ms. Anna Paskal. Go ahead for 10 minutes, please.
Anna Paskal Senior Policy Advisor, Food Secure Canada
Thank you very much for the opportunity to speak with you this afternoon. It's a real honour to be among you, our elected representatives. I acknowledge that you're working hard to make Canada a better place and to build a better future for food in Canada. Food Secure Canada shares wholeheartedly in those goals.
My name is Anna Paskal, and I'm the senior policy adviser for Food Secure Canada. As some of you may know, Food Secure Canada is a national membership-based organization whose members are taken from the food movement from coast to coast.
The food movement is the most diverse grouping of people who work in the food sector across the whole country. It includes farmers, fishers, people who work in food banks, teachers, nutritionists, dietitians, international development organizations that work on international food issues, unions, provincial and territorial food networks, and much more. It is the most diverse and vibrant group of people and organizations who work on food issues across the country.
The common goal that brings people together as members of Food Secure Canada is to work across silos and across geographies to build a healthy, fair, and ecological food system for Canada.
We're here today in the context of the Growing Forward renewal process specifically to speak about meeting consumer demand. Food Secure Canada feels well placed to speak to this issue and specifically to make some links between what consumers want and how genuinely meeting those needs will also build a healthier and stronger Canadian society overall.
I'm going to tell you a little bit of a story about how we came to be here today to recommend some of the things that we'll be bringing forward.
Food Secure Canada is emerging from an unprecedented countrywide initiative called the “people's food policy”. The people's food policy was a three-year initiative through which 3,500 Canadians participated in developing a national food policy for Canada. This was unprecedented and completely citizen-led, from coast to coast to coast, involving all kinds of Canadians.
The people's food policy was grounded in the principles of food sovereignty. Food sovereignty privileges people, communities, and nation-states to have the right to define their own food systems. Over the course of years, these 3,500 Canadians held kitchen table talks, wrote policy submissions, and participated in volunteer policy-writing teams. This is thousands of real people sitting around real kitchen tables talking about real food issues. These are all consumers, so bringing forward the priorities of the people's food policy reflects very accurately what consumers want today.
The result of the people's food policy is the overarching document “Resetting the Table: A People's Food Policy for Canada”, which you would have all received in advance of today's meeting. We also have 10 detailed policy papers; we sent you the one on agriculture, as it seemed most relevant today, but there are many others on other topics, such as science and technology and international food policy. You can refer to those on our website.
Taken as a whole, the people's food policy is the most comprehensive national food policy being advanced in Canada today. I would really like to underline that point, because we're at a time now when many different sectors and organizations are building national food policies or strategies; the people's food policy is the most comprehensive one being advanced, so I would urge you to consider it in discussions you may be involved in.
The impetus for developing the people's food policy began from a key starting point: our food system is failing Canadians. There are over two and a half million Canadians who don't have enough food to eat—two and a half million. I repeat that number because many Canadians, including elected representatives, aren't aware of the situation of food insecurity in the country. At the same time, we're losing thousands of family farms, over a quarter of Canadians are considered obese, and the industrial agriculture system is one of the leading contributors to climate change, so the status quo is no longer an option: we need change.
Canada can be a global leader in seizing this moment of change and meeting the needs of consumers while also building a stronger society, greater health for the population, and a stronger economy. This approach would be based on the number one priority that came out of the people's food policy, a process that involved thousands of Canadians from coast to coast to coast. Its number one priority is this: Canadians want a sustainable local food system approach.
In other words, they want food that is produced and processed closer to home, using sustainable methods. This very much matches the broad outcomes that you've already identified for Growing Forward around competitiveness and market growth, and specifically around adaptability and sustainability. A sustainable local food strategy would help meet those needs.
One after another, urban and rural, indigenous and non-indigenous Canadians told the people's food policy that they want to serve their families food that is processed and produced closer to home and produced through sustainable methods. I think this echoes very much what Mr. Johnston was saying.
The potential benefits for our society are huge. Local selling and processing opportunities shorten the food chain, which has cost savings and environmental benefits. Working this way links farmers to citizens, maximizing the dollars that farmers receive. Rebuilding local and regional food economies revitalizes rural and remote areas while bringing fresh, healthy food to more people, including in the cities. A shift to fresh and healthy food based on local ingredients can bring great benefits to Canadians, from school kids to people recovering in our hospitals.
A shift of this nature would result in reductions in health care and social costs, and gains in environmental and other externalities. It's a real win-win policy approach.
There are many examples that come from the entrepreneurial and innovative food movement, many of which are Food Secure Canada's members. I'll just mention three to illustrate what I mean by local and sustainable food approaches.
One of them was mentioned already by Dr. Evan Fraser, so I'll repeat that, just because it's sometimes good to hear about things twice. I'm talking about FarmStart. FarmStart is an NGO that supports new and young ecological farmers by offering them the chance to try farming, and if they like it, by providing support—technical support, business planning support—so that eventually they can start their own farms.
Another example is FoodShare, based in Toronto. They run a food hub. They buy large amounts of fruits and vegetables from nearby farmers, bring them to the city, and then distribute them at an affordable rate to schools. They serve hundreds of schools in the Toronto area. They also provide good food boxes to the local community.
Another example is Local Food Plus, which helps to build regional food economies through local sustainable procurement. They're like a dating service for buyers and producers of local and sustainable food. They bring them together and they provide a background check, a certification system, to show that this really is local and sustainable.
These are just a handful of the groundbreaking and innovative local food programs that come out of the food movement. They would benefit from additional funding, but specifically from enabling policy environments.
Many members of the general public are already supportive of positive and forward-looking food systems. We all know there is unprecedented interest in local and sustainable food. People are talking about their farmers and their fishers just the way they used to talk about their doctors. There is a real pride in getting to know where our food is from. However, to really make systemic change and reap the benefits that I outlined above, we must build support for sustainable local food into our policy processes, and this is where you guys come in.
Key to this is the procurement sector. Federal, provincial, territorial, municipal, our schools, our hospitals, our universities, our correctional facilities, our legislatures, government offices—these can all be powerful allies in building the kind of food system that Canadians want, which is food that is Canadian and is sustainable.
If there's one request that Food Secure Canada would submit for your consideration, it would be to make the most of this policy renewal opportunity and to support a sustainable local food strategy. A sustainable local food strategy could be a key guiding component of the Growing Forward framework. It can be an overt, clear strategy with associated financial support for sustainable local food and it would help address many of the challenges facing our country.
It would also address the broad outcomes desired for Growing Forward—competitiveness, market growth, adaptability, and sustainability. If anybody is interested, I have quite a few specifics on what a local food strategy could entail.
By supporting local food producers and regional food processing, by encouraging local food infrastructure, and by building community and institutional demand, we can build a new food system for Canada. This would require a significant shift in focus for Agriculture and Agri-Food Canada as well as other departments, but we can do it, and there would be a lot of citizen support.
We've quadrupled food exports in 20 years in our country. We can surely quadruple how much sustainably produced Canadian food is being grown, processed, and eaten closer to home. This would make a real difference in our economies, our environment, and our health.
We can work together to build on the tremendous innovation that's already sustaining diverse, decentralized, and resilient food production and processing. We can do this through a comprehensive, federally funded, sustainable local food strategy.
In so doing, we can enhance the strength of our economies, the resilience of our environments, and the health of our population. With your active support, we can make this happen.
Thank you.
Conservative
The Chair Conservative Larry Miller
Thank you very much.
We'll now move to questioning. Ms. Raynault has the first five minutes.
Go ahead, Ms. Raynault. You have five minutes.
NDP
Francine Raynault NDP Joliette, QC
Thank you, Mr. Chair.
My question is for Ms. Paskal. I scanned your brief, which provided a lot of information on the People's Food Policy. Thousands of people have been consulted and given their opinion on the food we eat today. Despite all the commercial production, some people do not have enough to eat.
Is it because the price of fruits, vegetables and meat is too high? Is it because people don't earn enough money to buy them?
Senior Policy Advisor, Food Secure Canada
Basically, it's a matter of poverty.
The other recommendations of the People's Food Policy reflect other priorities. I noted two—sustainable food and eating locally—but there are five in total. One of them is a federal poverty prevention program. If we don't systematically address the fact that people can't get healthy food, we'll never be able to resolve the food insecurity situation in Canada.
NDP
Francine Raynault NDP Joliette, QC
Exactly. We also know that people are turning to food banks more and more. I find it appalling that people cannot buy food.
As for agriculture, what could we do to encourage young people, boys and girls, to become farm producers, to raise animals, grow vegetables, even though those young people aren't from farming families? People would need government assistance to get established. What's your opinion?
More local vegetables would need to be available on the market. Farms would certainly be smaller; they wouldn't be 1,000 acres, but probably a few hundred. However, they could feed people locally.
Senior Policy Advisor, Food Secure Canada
Actually, in 15 years, we have lost 62% of our young farmers. It's a very serious situation. If we want Canadian food and agriculture, we need Canadian farmers. And for that, we need to take into account what farmers make. Now, as you know, their income is less than zero, if we consider the fact that people work outside the farm and we exclude grants. We should first be able to support the incomes, and we have several suggestions for that. Then, we should have programs to support new farmers who would like to farm.
I made reference to an NGO based in Ontario that does this very well and that is starting to have programs in other provinces. But there's a lack of funding. If we had more programs like that one, we could enable young farmers to try to get into agriculture. It's important to have programs where established farmers provide support so new farmers can determine if they like farming, can know what the challenges are and see what they can expect. They also need financial help. Business plans and all that need to be developed. There are NGOs that do this very well, but they need support to develop those plans, and a policy system that can support this type of program that aims to bring more farmers to Canada. This is the key issue for having more sustainable Canadian food in Canada.
Senior Policy Advisor, Food Secure Canada
It could come from several sectors, since it's an investment in our future. So the funding could come from the government or the private sector.
We can evaluate what the social benefits and the benefits related to our health system would be. How much could we save by having more fresh, locally grown fruits and vegetables?
Obesity and heart conditions cost our country billions and billions of dollars. We are almost suggesting a shift toward local and sustainable agriculture that will have an enormous impact on health, economy and the environment in our country.
NDP
Francine Raynault NDP Joliette, QC
I don't want to name countries, but we know that the food we export is thoroughly checked, while only 2% of the food we receive is. So we don't really know what we're eating. Perhaps those countries are using insecticides and other products that we haven't been allowed to use here for several years. But we're made to eat it anyway.
Senior Policy Advisor, Food Secure Canada
Yes, and we know what the consumers want. Interest in what we eat has grown significantly. We want to eat healthy, fresh food from producers we know close to home. It's good for everyone. That's why I'm encouraging you to consider a concrete aspect of this policy that supports local, sustainable agriculture. There's a lot we can do.
Conservative
Conservative
Pierre Lemieux Conservative Glengarry—Prescott—Russell, ON
Thanks very much, Chair.
Thank you to our witnesses for being here today.
I would like to clarify one thing on the food processing side.
Mr. Johnston, you feel there is very little agricultural support for food processors. I want to at least make my colleagues aware that under AgriFlexibility, we announced $50 million for the agrifood processing sector. It's available up to 2014. To date $20 million of that $50 million has been allocated through 35 agreements. If we go with the numbers that were presented with the proposals, it should be creating over 550 jobs.
I know there have been other investments too. For example, there is Food Beverage Canada, Alberta's technology institute—I think you mentioned that—and other initiatives like that to help the food processing sector.
It is an important sector. I think it's a sector that's in high demand. As life becomes busier, Canadians have a desire for processed foods. When our food processors are presenting their products, I know they're trying to do it in a way that will be of true benefit to Canadians, a way that is nutritious and well presented, so that they become a natural choice by Canadians.
I want to ask a few things. First, when I think of processed foods, there is a wide scale. At the lower end, I would say there is taking fresh garlic, mincing it up, and putting it in a vacuum-packed jar. That's food that's been processed to some extent. Then I'm thinking of the other end perhaps, where you can have a whole meal presented to a consumer.
When you're thinking of the food processing sector in general, I'm sure you would span that spectrum as well, but where is the preponderance, I suppose, of the food processing industry?
As well, where is the growth within the sector? What are Canadians looking for?
I know that when I am in grocery stores, I see products changing. I see new products that weren't there before and I see old products that are being presented in a different way, with newer packaging and different attributes. I'm assuming that's what Canadians are wanting and willing to choose.
I wonder if you could share your thoughts with the committee about where the growth is within the sector, and how the sector is meeting that.
President and Chief Executive Officer, Alberta Food Processors Association
To begin with the first part—about what we encompass—in the case of my particular provincial association, our membership goes from the people who wash the dirt off a carrot and put it in a bag right through to that full meal preparation you were talking about, whether it's fresh-packed or otherwise.
The biggest areas of processing in this country are killing cows and pigs and cutting them up and putting them in a box. That is the biggest sector. Southern Alberta is a very important part of what happens in that area.
As to where the growth is going to come from in the Canadian industry, you have to put it into the perspective of being in a world market situation. In all honesty, we're a speck on the butt. We have 37 million people here; we're a very small country. We keep talking about becoming dominant, but what we really have to do in this country is become the best guerrillas out there and pick the niches.
I have a very good example. In Alberta we have a company that has become the largest gluten-free baker in North America. It does a great deal of business off the Internet and ships by courier. It's the biggest user of courier services in western Canada. It ships into the United States every day and is now branching into Europe on a similar type of basis, using courier services.
The world is changing in terms of what we can do. This is a very specific niche where we can be an expert and use Canadian agricultural outputs, although there are still some difficulties with it. He cannot get some product in Alberta that he needs; it has to come from Manitoba. We have some barriers to those kinds of things as well.
In sum, growth will be in niches. We react to what our customers want, particularly on the retail side. They are the ones who are talking to the consumer—not our people, and not the farmers. The retailers tell us what it is and where the next generation is. Sometimes they create it, as Loblaws has done with their “Insider's Report”; sometimes it comes from the demand that comes through various organizations.
Conservative
Pierre Lemieux Conservative Glengarry—Prescott—Russell, ON
Do you know if your clients use, for example, funding that might be available through Western Economic Diversification? These are agencies that are meant to promote economic growth, and all these food processors are businesses. They need new equipment, they need to hire new employees, they need to grow and expand into other markets. There is economic development funding available that's not necessarily agriculturally base, and I'm wondering if your clients take advantage of that.
President and Chief Executive Officer, Alberta Food Processors Association
WD is not one that the companies themselves would particularly go after. As an association we will work with WD in some of the programs, usually in partnership with the provincial government. We had one that developed a program to try to expand on private label development in western Canada, particularly in Alberta, to ship to the United States. It was working absolutely wonderfully when we had an 85¢ dollar, but it went right out the window as soon as we hit dollar parity. The company went bankrupt and went out of business.
However, we are very fortunate in Alberta, and I hold Alberta up as the example of what could be done. I think this needs to be done on a national level, and that's why the federal government needs to get involved. We have AFSC, the Agriculture Financial Services Corporation, which was set up primarily to administer the safety net programs for the province of Alberta but has grown beyond that. They now provide basic financing programs that support the modernization and the automation of this industry in the province of Alberta.