Evidence of meeting #11 for Agriculture and Agri-Food in the 41st Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was spirits.
A recording is available from Parliament.
Conservative
Joe Preston Conservative Elgin—Middlesex—London, ON
Fantastic.
Spirits is the same thing. You're talking about some incredible growth over the last number of years in the percentage of your market into the EU and into exports. What has that meant to the jobs in the spirits industry over that same period of time? Are we seeing a growth?
I recognize your suppliers are growing, and jobs. Obviously, the agricultural producers in all of our ridings are now supplying you with more stuff than they used to. What about you?
President and Chief Executive Officer, Spirits Canada
There's no question. All of our purchases of our inputs, particularly grains, are up fairly significantly.
There's no question that in 2008, 2009, 2010, the industry flattened out. We're an export business and our big markets tended to be some of those countries that were the absolutely hardest hit in 2008, the United States and Japan with the tsunami. That set us back.
The opportunity we're now seeing is that there is a significant shift that's taking place from white spirits, which have enjoyed 30 years, 35 years, of pretty robust growth, to a real interest in dark spirits, where whisky comes in.
There's no question. I would say that up until this point what has really happened is the business has been very stabilized, and there have some encouraging signals, but again you've got to go out and spend money to expose the new consumers to your products. That's a challenge for the industry with the margins we have in Canada.
Conservative
Joe Preston Conservative Elgin—Middlesex—London, ON
We keep talking here about how one day a couple of months ago, as this thing came to fruition, Canada found 500 million new customers. You just found 500 million new customers from an absolute no tariff point of view for your product into Europe.
Conservative
Joe Preston Conservative Elgin—Middlesex—London, ON
It's not hard to go hunting for those customers. Somebody might say—sorry, aquaculture—it's like shooting fish in a barrel.
Executive Vice-President, Spirits Canada
Just to clarify, though, we already were tariff free into Europe.
Conservative
Joe Preston Conservative Elgin—Middlesex—London, ON
You were already into the business. They know Canadian products there well and around the world, so that's incredible.
Dan, I loved what you said about wine and where we need to go. The growth in Canadian wines has been spectacular, but we're starting from two different spots. Where spirits were 100 years ago, Canadian wines are now in that same spot and growing forward.
I recognize you mentioned a couple of times that we really need to market to ourselves because we're not near penetrated there yet.
Mr. Westcott mentioned that we've learned to drink less but to drink better. I think Canadians are finding the same thing in wines. We're drinking far better wines, even our own in particular. But as our wines get better, we have to be able to sell them around the world too.
On your point on being able to sell into wine-producing countries, other wine-producing countries come here so it has to be our role to go there and sell there too.
President and Chief Executive Officer, Canadian Vintners Association
Absolutely. We do have an interest in the export market, without a doubt. We see that there are opportunities for growth in the export market, so this is a double-edged sword. There are so many opportunities in Canada. We have to take a look here, especially since the Europeans are looking here very closely. At the same time, we have to grow our market abroad.
The tariff reductions are pretty significant in Europe. They make life very much more attractive in that marketplace as well.
Conservative
NDP
Ruth Ellen Brosseau NDP Berthier—Maskinongé, QC
Thank you, Chair.
I would like to thank the witnesses for being here. As well, thank you for all the documentation and work that went into coming here and preparing the slide show. We really appreciate it; we often don't have enough time.
To the Vintners Association, I noticed that in your documentation you said, “Further, CETA will foster the growth of the Canadian economy with estimated savings of approximately $1,000 per Canadian.”
How did you come up with that?
President and Chief Executive Officer, Canadian Vintners Association
This was a remark that came out of the federal government in terms of what the impact of the agreement was. It was estimated that the impact would be roughly $1,000 per Canadian.
NDP
Ruth Ellen Brosseau NDP Berthier—Maskinongé, QC
Okay.
My colleague, Francine Raynault, kind of touched on this; we're neighbouring ridings, so we have a lot in common geographically in terms of what kinds of farms we have and also the wineries.
In Quebec the SAQ has more shelf space allocated for Quebec wines. Do you think that with CETA, the importation of more European wines will damage the small wineries we have set up in Quebec? You suggested that we need to have more buying locally, which is a huge movement. I could say I passed my summer in markets and working with people in the community and buying locally when possible.
Do you think all of this wine coming in will have a negative impact on the small wineries we have?
President and Chief Executive Officer, Canadian Vintners Association
I think our wineries have the quality of wine that can compete head to head. I mean, they said we were going to die after NAFTA, and our industry grew. We started producing much better wines. We were forced to by competition.
I think we will survive. What the SAQ has done is important. It's giving an opportunity for Quebec vignerons to have a category within their retail stores.
It would be extremely helpful if all liquor boards across the country, including the SAQ, created a category for Canadian wines, VQA wines. If they did that, there would be a great opportunity to put your products in front of Canadians and give them the choice. There's a Burgundy section, a Spanish section, but there is no Canadian section in a lot of liquor stores across this country. That would be extremely helpful.
NDP
Ruth Ellen Brosseau NDP Berthier—Maskinongé, QC
Ms. Salmon, I have a few questions.
First, what is considered a high-end seafood product? Is that just caviar? What is considered high end?
Executive Director, Canadian Aquaculture Industry Alliance
I would say that a number of species fit into high end. Maybe it's because there's not as much volume. I think I mentioned sablefish, which is black cod, caviar, sturgeon, even halibut, and Arctic char, whereas our largest volume products, like Atlantic salmon and rainbow trout, and mussels and oysters are maybe less so, although even oysters can be considered high value.
It also includes anything you do extra with the products. For example, I think the European market will be a real attraction for Atlantic salmon producers, maybe not fresh Atlantic salmon, but smoked, or when some additional value is added to the product. That really is what the European market is looking for, that sort of high-end differentiated product.
NDP
Executive Director, Canadian Aquaculture Industry Alliance
Yes, the EU is a very competitive market for seafood. Norway is close by, so it's certainly not without competition. But as I say, Canadian farmed seafood products really have an excellent reputation. We've already established some inroads. I don't think there's going to be a problem for a continued market there.
NDP
Ruth Ellen Brosseau NDP Berthier—Maskinongé, QC
You've had a lot of recommendations. How has the government been receptive to the recommendations and negotiations?
Executive Director, Canadian Aquaculture Industry Alliance
We've actually established a national strategy for legislative, regulatory, and policy reform with Agriculture and Agri-Food Canada as well as DFO. To date, our discussions have been positive.
I think we need to move forward in ensuring that we do have a national vision, but we've had some success to date in getting their attention. Hopefully, we'll see some positive movement in the next year or two.
December 10th, 2013 / 4:20 p.m.
Conservative
NDP
