Agriculture Committee on June 6th, 2012

[Florian Possberg]

The Canadian average would probably be 22. The very best producers would have 30 plus.

[Ben Lobb, Conservative, Huron—Bruce, ON]

With the changes, obviously the mortality rate of piglets will go up. Have you done some sort of estimate as to the decrease in the number of piglets per sow?

[Florian Possberg]

There's a misconception out there that we're going to make stalls disappear completely. That's not true. During the farrowing process, when they're having the piglets, and the piglets are very susceptible to having a very large mother lie on them, there's no jurisdiction saying that this is really a threat, because having a big mother lying on a very small pig is not really good animal welfare for the baby pig.

We think there's enough evidence that we can make the change to partial group housing for gestation from our current state of having total gestation stalls. If we do it right, we can do it with minimal loss in productivity.

[The Chair, Conservative, Larry Miller]

Thank you very much.

We'll go to Mr. Atamanenko.

[Alex Atamanenko, NDP, British Columbia Southern Interior, BC]

Thanks.

Before we start, I'd just like to say that I, too, welcome Wayne to this table. I certainly have valued his expertise and knowledge over the six years I spent with him on committee. He probably has more experience in this sector than anybody else around this table. I just don't appreciate the cheap sarcastic shots at a colleague, Ben. I don't think that's right. Anyway, I just wanted to put that on the record.

Travis, it's really nice to see you here. You've retired as president, but you're still involved. Thank you for continuing that fight on behalf of cattle farmers.

It's a pleasure. It's always great to see you here.

You mentioned something I found quite interesting, among other things. You mentioned that vets are posted abroad in key markets. I know that when I was an interpreter, one of my missions was visiting all these pork slaughterhouses in Canada where they had vets from Russia. They had come here to check the production lines to make sure that it was acceptable for our meat to be exported to Russia. From my understanding, we do the same thing for meat that's coming in from outside of the country.

Why would we be sending our vets abroad to enhance our export capacity?

[Travis Toews]

That's an excellent question, Mr. Atamanenko.

The veterinary technical expertise is valuable in countries such as Japan, Mexico, and others because of the depth of technical knowledge required for the technical market access negotiations dealing with the science around BSE and around specified risk material and its implications. It was for that reason that it was very beneficial to have that expertise in those foreign markets.

[Alex Atamanenko, NDP, British Columbia Southern Interior, BC]

In other words, Travis, when undergoing negotiations we have a vet on our side to explain what exactly happened here, for that authority?

[Travis Toews]

That's right.

[Alex Atamanenko, NDP, British Columbia Southern Interior, BC]

Thank you. I wondered what that was.

For the pork sector, Mr. Possberg, time and time again over the years that I've been here we've had representatives from the pork industry saying—and I remember once—that we don't have a level playing field, that we need a level playing field to compete with foreign governments. I don't hear that now. Does that mean that the pork sector is experiencing better times, that we've been able to hold our own, and that our farmers are in a better position than they were, say, two or three years ago?

[Florian Possberg]

We did go through a tremendous period of difficulty. It started in 2007 and ran through until about 2010. That's not to say we've had a real rosy time since, but I've always maintained that tough times make good managers. So, the ones that have survived are really quite clever in how they run their business and how they survive.

We still have a way to go. One of the programs that helped us out during the tough times was the AgriStability program. Our producers had enough bad years that they really had no margin in their account. So, if they are hit with really difficult times again, AgriStability is not going to help much for our producers. We're quite vulnerable, but we're surviving now, and I think we've structured our business so we're more competitive, which is a good thing.

[Alex Atamanenko, NDP, British Columbia Southern Interior, BC]

Thank you.

My third question is for Mr. Gordanier. In our country we have the problem, I understand, that we can't export from province to province if we slaughter in provincial slaughterhouses. I imagine most of the lamb and sheep are slaughtered in provincial slaughterhouses. Is there a push by the federation to change that, so we can move lamb right across this country?

Is there enough market for lamb domestically, given the fact that we import from New Zealand and other places? In other words, if the market were open, could our lamb producers produce as much lamb as possible and still continue to produce and make money?

[Andrew Gordanier]

Sure. Thanks for that question.

Most of the slaughter capacity is in Ontario and Quebec, most of it being in Ontario. Most of the consumption is also in Ontario.

Although not having as much federal slaughter as we would like to have creates a little bit of a problem, not being able to go province to province is not a huge concern. In western Canada we have a federally inspected slaughter, so some of that production comes east. The animals that come live east and are slaughtered here in provincial plants end up in the provincial, small independent grocery stores and your corner butcher shop.

For us specifically, it's not a huge problem, although there are some interprovincial—I shouldn't speak too much to it—pilot projects going on with interprovincial trading of meat from provincially inspected slaughter plants. There is an interest, certainly regionally, say in eastern Ontario, with Quebec, with central warehousing, as I mentioned earlier.

I'm sorry, what was the second part of your question?

[Alex Atamanenko, NDP, British Columbia Southern Interior, BC]

Let me ask another one if I have a couple of minutes here. Are the B.C. lamb producers limited to our own British Columbia market, or is there a way for them to move their produce across the country?

[Andrew Gordanier]

Specifically, in British Columbia, they're in a significant deficit production situation considering the population that we have in Victoria and Vancouver, and the demand there far outstrips the supply.

[Alex Atamanenko, NDP, British Columbia Southern Interior, BC]

In other words, we're okay then?

[Andrew Gordanier]

In the short term, yes, but it would depend on the level of expansion that we experience as we move forward.

[The Chair, Conservative, Larry Miller]

You're out of time, Alex.

[Alex Atamanenko, NDP, British Columbia Southern Interior, BC]

Thank you.

[The Chair, Conservative, Larry Miller]

Mr. Lemieux, you have five minutes.

[Pierre Lemieux, Conservative, Glengarry—Prescott—Russell, ON]

Thank you, Chair.

Thank you to our witnesses for being here today. I think it's important that the value chain round tables have a voice in this study of supply chain management, particularly as we're focusing on the red meat sector at the beginning.

The government feels that value chain round tables are big contributors to the industry, and they work very well with government as well, so you're filling an important role.

I'm glad to hear—I think Travis was saying—that there is growth in the value chain round tables. I think that's a good thing.

When we started this study, before we moved into the red meat sector, we sort of did an overview, and now we're focusing on the red meat sector. The value chain is quite long, of course, and it branches at many different places. What I'd like to know is—and maybe I'll just start on the beef side, because we did go to see a slaughterhouse in Guelph—where does the value chain round table see it can have the most impact in the value chain itself?

It starts at the farm. It works its way through feedlots. It gets into the slaughterhouse. Of course it can branch there. You can get products being sent straight to retailers, which people see perhaps on grocery store shelves. It can go to butchers. It can go to restaurants. It can go to further food processing. How far along that chain do you actually look, when you're looking at ways that you can bring value to the value chain?

I'll start with the beef side, and then maybe I'll ask the same question of pork, and then of sheep.

[Travis Toews]

That's a very good question. I'll give a really short answer and then a little longer one.

Ultimately the beef value chain round table has a lot of value at any and every point in the value chain, right from the genetics industry in the cattle industry right through to the retail side, where the consumer is buying a product, or even the food service side.

One thing I think has been particularly noteworthy with the value chains is the realization that for us to function competitively as any one part of the industry, we're dependent on the whole industry being incredibly competitive. So the beef value chain round table has been a venue where we can collectively consider each individual sector's competitive challenges, take a look at those challenges, take a look at what the solutions might be, and not in isolation of the other sectors. Because as you know, very often solutions developed by one sector will have unintended consequences in another. So it's been a great venue to look at those issues collectively and then to move forward with an action plan.

[Pierre Lemieux, Conservative, Glengarry—Prescott—Russell, ON]

Right. Okay, thank you.

Is there someone who'd like to answer over on the pork side?

[Florian Possberg]

The real value we, as producers, see is that we didn't often have the opportunity to sit down at the same table with the major processors and other partners in the value chain and the federal government, quite frankly, and the people from CFIA. So it's been a great opportunity to exchange ideas.

One of the things that Mr. Toews mentioned is right on. We actually started talking about emergency preparedness, and one of the examples was that if we had a hoof-and-mouth disease outbreak, quite frankly all hell would break loose. The packers' response was that they would probably lay off their workers and go home, because they would have issues selling the meat. For the producers, not having a place to slaughter our animals seemed like the exact opposite of what was needed in the event of such a tragedy happening. So the opportunity to actually sit down in a forum like this and actually understand the mindset of other partners in the chain and understand what their actions would be under certain circumstances was really quite valuable. So we can work those things out if we know where the issues are, and we can attack them.

[Pierre Lemieux, Conservative, Glengarry—Prescott—Russell, ON]

Good.

Is there someone from the sheep side?

[Andrew Gordanier]

I would say that just having the whole value chain at the same table is a huge one for the sheep industry. It's not really something we've done before, or if we have attempted it before, we haven't done a very good job of it. We really do have everyone from the value chain there.

For the sheep industry right now, or specifically for lamb meat, we have a situation in which the primary producer is getting paid very high prices for the primary product, and that's causing negative margins along the rest of the value chain. We see expansion of production being very helpful with that.

I mentioned before, but I think it's worth mentioning again, that the creation of this expansion working group out of the sheep value chain round table is something that's absolutely necessary. Having the whole value chain as part of that discussion will make it meaningful for everyone.