Agriculture Committee on May 30th, 2012

[Stephen Laskowski]

I couldn't agree with you more. We are working on that issue.

But I think there are two issues here. There is the issue of making sure that the animals are moved correctly and the public image is there, but then there's also an education that's required by us as an industry to make them understand that when we're moving the animals correctly, there still may be objections to how the animals are moved. What we need to ensure is that we're doing it the right way and we're educating the consumer that we're doing it the right way as to how the animals are done. Today we wanted to show you a video that we made of how to do things properly.

So you are correct. There's an education campaign and there's an insurance campaign, and we're working with our customers and the public to make sure things are done right.

[The Chair, Conservative, Larry Miller]

Thank you.

Mr. Storseth, five minutes.

[Brian Storseth, Conservative, Westlock—St. Paul, AB]

Thank you very much, Mr. Chair.

I have to set the record straight. I was actually complimenting Mr. Zimmer for the tremendous work he did with the Taiwanese—

[Voices]

Oh, oh!

[Brian Storseth, Conservative, Westlock—St. Paul, AB]

—in softening the ground for Canadian beef exports into Taiwan. In fact, in my meeting last week, Mr. Chair, with President Ma, he was certainly aware of the importance that agriculture plays with Canada when we deal with bilateral trade agreements.

That actually leads to my question for Mr. Masswohl. I know that our government has been open for business. Our minister has done a tremendous job in travelling around the world helping to introduce Canadian businessmen to other countries and in opening different markets. But how important has it been to the cattle industry and to your association that the knowledge is there with these other countries that if you do want trade with Canada, agriculture plays a very significant role?

[John Masswohl]

Again, I guess I'd echo some of the comments that Dennis made as to how important trade is for the beef sector.

Over half of our production is exported. It adds value directly back to the cattle producer to have that access, because there are so many parts in the animal. There are over 300 different products that come out of a single beef animal, but it's not within Canadian culture to consume all of those products. There are certain products in an animal, whether they're leg bones, lungs, or livers, that Canadians don't eat, but they're certainly worth a very good value in places like Taiwan, Korea, North Africa. It does add so much value.

Dennis mentioned the fact that the minister has been travelling around the world to meet with his counterparts to open markets. We believe that well over $700 million of value to the industry in the last year has been attributed to markets that have been opened as a result of those efforts. We certainly feel that those efforts produce quite a payback to the cattle producers.

[Brian Storseth, Conservative, Westlock—St. Paul, AB]

Thank you very much.

Mr. Laskowski, as this committee is about the red meat supply chain, I want to talk to you about the importance your industry plays in that supply chain.

Unfortunately, I think that oftentimes industry doesn't do a great job of simplifying and explaining what they do and some of the best practices that are taken. Often people who are calling for more, not only from producers but your industry, use words like “biosecurity”, and other words that sometimes serve to confuse Canadians. Can you talk about that from a more practical position?

I'd like you to mention two things. One is the role that the increased penalties that our government has put in place will play. We're not just walking the talk, we're actually taking real action, which is important. Two is some of the best practices used by your industry, both right now on some of the advancements that have been made, but also what you see happening into the future as well. I think there's some good news to be had out of this.

[Stephen Laskowski]

Absolutely. I think the one message here with regard to enforcement of penalties—and our overriding theme and how Deanna was presenting it—is that it's good to have a stick.

I think you need government's utilization of the stick in the supply chain, which is always a good thing. It keeps everybody honest. But make sure you're hitting the right person over the head with it. Also, make sure that those who are out there conducting themselves in an inappropriate manner are dealt with. If we're going to toughen the standards, let's make sure we're selecting the right targets to send the message to. Then, when you get specific within those sectors—Deanna brought up AMPs, tagging issues, and there are also some market issues—make sure the message is sent to everyone in the supply chain.

We are the small player in the food supply chain. We're an important player, but we're everyone's customer. We are the weakest link in the supply chain when it comes to leverage.

Therefore, when penalties are introduced, we say to government that it's not necessarily a bad thing. Regulation is not a bad thing, especially when it comes to this area. But let's make sure we're keeping everyone honest in the supply chain, that we're rewarding the good players and focusing in on the bad actors, and in this case, making sure they get out of there.

When you're dealing with biosecurity and animal welfare, you need to make sure that only the best of the best are in this business. It's too important, both for import and export, for the end-user, and in our area, for the animals' welfare.

We are, as the other member mentioned, very visible representation for animal welfare and animal safety in this area, so let's make sure that only the best are on the road with regard to transportation of these animals.

[Brian Storseth, Conservative, Westlock—St. Paul, AB]

Can you talk to some of the best practices that are being used, that many Canadians wouldn't necessarily know are being used?

[The Chair, Conservative, Larry Miller]

Very, very briefly.

[Stephen Laskowski]

I think Deanna mentioned them, but it's not only key to have best practices on the issue. These have to move from being best practices to best requirements.

[The Chair, Conservative, Larry Miller]

Thank you very much.

Ms. Brosseau.

[Ruth Ellen Brosseau, NDP, Berthier—Maskinongé, QC]

Frankly, I think that we could easily spend the whole day discussing this. I know because I have several questions for you.

My riding is rather rural. In D'Autray, there are 19 pork producers and in Lanaudière, there are 119. I take the interests of my constituents to heart. I know that since 2007, pork consumption has decreased. There is a lot of thought being given to the situation. People want less use to be made of the sow cages.

If we had a strategy, if we worked with the pork producers to establish a pan-Canadian strategy, do you think that that could encourage consumers to eat pork, and that they would be more inclined to do so if we could assuage their concerns?

[Jean-Guy Vincent]

I don't know if we can link consumption to production methods. I am not sure that the two are related.

However, I think that we are already working together, under the code of practice. This involves several organizations sitting down together around the same table.

You say that there are a lot of pork producers in your riding and in the neighbouring riding. You are probably in a good position to know about their concerns. Earlier, someone referred to another topic. We were saying that perhaps people don't know enough about what we do, about what producers do.

Last week, there was a conference in Winnipeg, and Ms. Temple Grandin, who is a well- known expert in the area of animal welfare was in attendance. A lot of producers from all of the regions were present. Ms. Grandin was saying that producers should perhaps use tools like Facebook.

We producers don't do that because we are busy raising our animals. My wife and I own our farm. We work with my son, and the three of us are partners. Over the 40 years we have spent producing pork, we transformed our buildings on three different occasions to improve our livestock production and the conditions for our animals, since we work with them. If our animals are not well-raised, we will not make any profit, and our business will not be profitable. That is our main concern. That would be my first point.

My second point concerns the consumer. We were talking about pressure groups and perception. Earlier, we talked about perceptions with regard to transport. Today, there is a lot of pressure around that. That is why our message is the following: I, like others you know and we know in Canada and Quebec, treat our hogs well. If the governments want us to change the way we do things, we will do so. However, you cannot simply tell producers that they are at the bottom of the totem pole, and that for that reason they have to foot the bill for any changes.

[Ruth Ellen Brosseau, NDP, Berthier—Maskinongé, QC]

It is expensive.

[Jean-Guy Vincent]

We are told that because we produce a core product, we are going to pay, we should reduce our salary and work even harder because people want something else. My message is the following: all Canadian producers raise their animals well, but if people want change, we have to be given the means to make those changes. The consumer has to be aware of the fact that he is going to have to pay.

[Ruth Ellen Brosseau, NDP, Berthier—Maskinongé, QC]

You have to make sure that there is a demand.

There's a market for it.

We see that McDonald's, Burger King, Tim Hortons and Wendy's want to use—

They've all announced plans in the past four months to eventually only buy pork from farms with open housing systems. Maybe if they started using them in the future, they could reply to that demand.

[Jean-Guy Vincent]

Did they ask producers what they thought of this? In their notice, did they tell producers that they were going to pay them more?

[Ruth Ellen Brosseau, NDP, Berthier—Maskinongé, QC]

No, no.

[Jean-Guy Vincent]

The members of the committee belong to various parties. In the past, all of the members worked together to improve agriculture. I hope that that is what we are going to do today. The government can go forward. If in addition, it has the support of the opposition... We are caught between the two. We want pork producers in Canada who have had difficulties over the past few years to get help, if the consumer agrees. All of the links in the chain, that is to say producers, processors, transporters, distributors, are involved. And the government and the members who sit in the House of Commons in Ottawa can help us. Thank you.

[The Chair, Conservative, Larry Miller]

We're out of time. I was just letting you finish; I didn't mean to cut you off.

Mr. Vincent, just one suggestion, I'm a farmer and I don't think all this pressure you're talking about is coming from the consumer side at all. It's—I'll just say—extremists on the issue who pretend they have a voice. You talk about money or something. You talk about the extra costs. You either absorb them at the industry level, which I've come from, or you ignore them as an extremist.

That's all I'll say on the matter.

Mr. Shipley, you have five minutes.

[Bev Shipley, Conservative, Lambton—Kent—Middlesex, ON]

Thank you, Mr. Chairman.

I know my time is short, so first, to the beef producers, Mr. Laycraft and Mr. Masswohl, you talked about the importance of trade. I'm fortunate to be on the international trade committee, where we've had the opportunity to meet a number of times because of the significance of agriculture to the trade agreements. I think you measured a $700 million payback, in terms of being able to get out and expand markets.

But during your discussion, you brought up something, Mr. Laycraft, that I wanted to talk about. In regard to Canadian beef, you're advocating a price insurance program as part of Growing Forward 2. I'm just wondering if you could help me here on the number of producers and why that is a program, as we move forward.... I'm trying to understand it. You mentioned that Alberta now is using it. How many producers, either in numbers or percentages, are involved?

[Dennis Laycraft]

I don't have the most current numbers, but I will say that it tends to move up and down with your insurance options and what it looks like your coverage will be. It's designed to allow you to take a look at a future price scenario. It essentially buys some insurance against that.

What's attractive about this is that it's a premium-based program. If you're buying more insurance, it will cost more money, but it increases your level of coverage. It also allows you to still have the topside in the market. In your contract in cattle, for instance, you've already fixed that price in there.

With the increased value of cattle and all the different challenges we face—weather challenges, and you can see the challenges we are experiencing in Europe and the impact that has on markets, and the volatility that we're dealing with—it adds another tool that producers can use to look into that period of time when they're going to be marketing those cattle. They can establish essentially what their break-even will be using this, and do it at a reasonably affordable level of coverage. Sometimes they'll take a look at what's available and decide they don't think that coverage is suitable, and you'll see the participation decline. Other times you'll see it increase.

Recently we saw some of the prices decline, and a number of people actually were able to get some coverage as a result of that program.

[Bev Shipley, Conservative, Lambton—Kent—Middlesex, ON]

I'm just wondering, when you're promoting it, is it 70% or 80% of the producers who are using it as a program that we should be implementing across the country, or is it...? Can you help me with that?

[Dennis Laycraft]

I don't have the precise recent number here, but it's a smaller number than that.

Initially it was only available to the feeding sector. They're rolling it out to the feeder cattle, which will allow cow-calf producers and backgrounders to get involved.

But we'd be happy to come up with those numbers for you.