Agriculture Committee on April 30th, 2014

[Anne Fowlie]

There have been a number of improvements over time, but we're not there yet. Again that speaks to dovetailing our regulatory regimes. Based on science we're at a point now where there's a lot of work-share that goes on, where we do have joint submissions. PMRA and the U.S. EPA will do work-share and they will parse out the work so that there isn't that duplication. There have been some changes made to crop groupings and zoning that have all been very positive.

The biggest areas we see the differences in now are things like worker exposure, the timeline to be able to go back into a field after you've applied a product, cancer risk assessment. We're getting to a point where we are reasonably close.

[Mark Eyking, Liberal, Sydney—Victoria, NS]

With the Americans.

[Anne Fowlie]

With the Americans. But as with anything else, it seems like the toughest things are always the last ones to do. I think there needs to be some real good direction and policy to the regulators to really sort that out. It is one of the action items under the Regulatory Cooperation Council. There is a greater access to products, but it's still not a 100% level playing field.

[Mark Eyking, Liberal, Sydney—Victoria, NS]

Is the country-of-origin labelling having any effect on the produce industry in Canada?

[Anne Fowlie]

No.

[Mark Eyking, Liberal, Sydney—Victoria, NS]

Do we send stuff down there that gets repackaged into salads? Does it have any impact on us at all?

[Anne Fowlie]

Under the Canada Agricultural Products Act, there are regulations around things having already to be marked “product of Canada”, and if you are bringing in product from the U.S., say potatoes or apples, and repacking them here, they would have all the Canada branding on them but the packages would have to say “product of U.S.A.”. As far as our sector in particular is concerned, COOL is not a friction point. There are some others, but that is not one.

[Mark Eyking, Liberal, Sydney—Victoria, NS]

Do I have any more time, Chair?

[The Chair, Conservative, Bev Shipley]

You have one minute.

[Mark Eyking, Liberal, Sydney—Victoria, NS]

My last question is dealing with GMOs.

Both your industries of course use GMOs, and there's some legislation. In Europe the labelling is different. Where do you see it should go? There is some sense in Parliament that some members might be bringing forward legislation dealing with the labelling. What do you think about that? Where do you think we should be going with your products in labelling and GMO? Should there be any regulations at all?

[Patty Townsend]

In one minute?

There is already a voluntary system for labelling of genetically modified products in place under the Standards Council of Canada, and a company can choose to label whether it is or is not a GM product. They just haven't found the need to do that.

[Anne Fowlie]

We need tools and I guess when it comes to labelling I don't know what negative labelling really accomplishes. I think there's an awful lot that needs to be done with respect to education and to create understanding. We need tools. If we're going to continue to profit, and provide healthy products, and sustain the world, we have to have all the tools and technologies, and whether it's pharmaceuticals or in food production, that applies.

I think there's been a lot of fear-mongering done. I look back to many years ago with potatoes in particular, because there had been tremendous advances made, and very positive ones in fighting pest and disease, but it was as Mr. McCain himself said at the time, it's not that it's bad science, it's just not good PR. We've evolved some, but there's still further to go.

[The Chair, Conservative, Bev Shipley]

Thank you very much.

Your time is up, Mr. Eyking.

We'll go to Mr. Payne, please, for five minutes.

[LaVar Payne, Conservative, Medicine Hat, AB]

Thank you to the witnesses for coming.

Welcome to the students. I'm hoping you'll learn something fantastic from this experience that you have here on the agriculture committee.

Ms. Townsend, in terms of your presentation, you talked about mostly the investments in corn, canola, and soybeans. I know that innovation certainly is a driving force in the industry. How has that changed in terms of the world economy, and how do you see that affecting the population growth? You did talk about additional food being produced to feed the world.

[Patty Townsend]

The reason the private sector invests 84% or 85% of its total investment in corn, soybeans, and canola is that they can recover their costs. Right now, in cereals in particular, they can't. The example I gave you of FT Wonder in Ontario is a pretty good example of that.

The private sector is gearing up to invest. They have a much more positive outlook with some of the changes government has made in regulatory areas and others. Bill C-18 certainly is a strong contributor to that. They are gearing up to invest. Where in 2007 they had predicted that they would only be investing about 2% of their investments in wheat, they're up to about 8% in 2012. They actually have turned more towards wheat because of some of the encouraging signs they're seeing.

I think there's still some work to do. Some of that work includes things like making sure our regulatory system is more nimble and flexible. We have been waiting for a simple regulatory change around the placement of soybean and variety registration, for example, for three years now, and it's just a simple regulatory change. We need to have a flexible regulatory system.

Canada is very well positioned to make a strong contribution and, I would submit, lead the effort to feed a growing population. We just need to make sure we have the environment, the policy and regulatory environment, in place to do that.

[LaVar Payne, Conservative, Medicine Hat, AB]

I know we're investing $3 billion in innovation and research, so I think we're trying to make sure that happens. Obviously, it's much more difficult to do it over a longer period of time. However, when you're looking at the various universities and other organizations who are doing research, they all have their issues. We did hear about some of that on Monday.

Is there a way that, through this research funding, some of these organizations that are applying for much more funding from various organizations could simplify their processes in order to make sure they don't have to do 10 or 15 reports for one particular project?

[Patty Townsend]

That's probably more of a question for Anne than it is for me.

In our industry, although they do build, and are continuing to build, private-public-producer partnerships, it's done with private sector money for the most part.

In the case of wheat, for example, Agriculture and Agri-Food Canada has made some announcements and discussions about how they're going to approach wheat breeding. They want to focus more on generally applicable research—disease resistance, mapping the genome, and some of those things that serve as a very strong foundational basis for the development of varieties—but the actual development of varieties they want to do in partnership with the private sector.

I think that's a great model. It's just a matter of making sure that once the private sector gets in on that partnership, they can actually navigate their way through the system to actually deliver the varieties to farmers.

[LaVar Payne, Conservative, Medicine Hat, AB]

Anne, would you like to comment on that as well?

[Anne Fowlie]

I have a lot of similar thoughts.

I guess the collaborative approach as to how the private sector and government are working together has changed, in part because of clusters, in part because of a lot of the rationalization that went on with regard to all of the research centres across the country starting back in the early 1990s. There certainly was a huge shift then.

I think that will continue. Certainly within the industry there's very much a lot of angst around all of the capacity they see being lost in terms of breeding programs and the expertise on the government side of breeding. There's a certain element of public good also that's associated with that, and that has to be maintained. I certainly would hope that we would not ever reach a point where our government would have very little role left in that area.

I think it's about the exchange of information, collaboration, people knowing what's going on within a sector across the country, both as an industry and even among the government researchers. I think there are some voids there that are starting to close. That goes as well for initiatives that we're involved in internationally, through the international potato group or others; we would be in other countries and hear about research that Agriculture Canada was doing that we had no idea was going on.

[The Chair, Conservative, Bev Shipley]

Thank you very much, Mr. Payne.

I will now go to Madam Raynault for five minutes, please.

[Francine Raynault, NDP, Joliette, QC]

Thank you, Mr. Chair.

Thank you, ladies, for being with us today. I would also like to thank the students for being here.

Ms. Townsend, on line 12 of page 2 of your document, you say:

All of these and other advances are entering the innovation pipeline at a rapid pace and hold great promise for farmers and consumers. The question becomes whether and how Canadian farmers will be able to access these advances.

Could you expand on that? You also say:

The answer is: Only when Canada's policy and regulatory environment facilitates investment.

Could you expand on that? Because on the next page, you say that there hasn't been a real improvement in investments in oats and pulses.

Why have these two products not benefited from significant investments? Is it because they are not profitable? Is it because people no longer eat them and no longer eat enough pulses?

[Patty Townsend]

On the first statement about all of the innovation that's occurring, I just wanted to point out that there is innovation occurring. Most of it is the result of improved genetics, and genetics are delivered by the seed.

The problem is that if it's the private sector, which is my membership, and the private sector is expected to deliver those things, they aren't delivering them in Canada, and they're investing in countries where they can recoup their investment.

In pulses, for example, the way that the pulse research right now is being done, the product sector can't compete because of how royalties are collected or not collected, and how it's funded through farmer check-offs and then directed to only one institution in Saskatchewan, for example.

In cereals, again, the private sector is not investing, because, as in the example I gave of FT Wonder, they can't recover their costs because farmers are saving seed. It's a blunt black and white statement that farmers will buy a bag of seed. The seed companies and the private sector and the public sector only have the opportunity to get remunerated on the sale of seed. Farmers buy a bag of seed and they just keep saving the grain to use as seed. They're only remunerated on one bag.

That's an extreme example, but that's what's happening in a lot of crops. It's not that there isn't a demand. I would tell you that the pulse industry is growing, they're becoming more and more innovative, but a lot of the private sector investment in the pulse industry is not happening in Canada.

[Francine Raynault, NDP, Joliette, QC]

So elsewhere, where it is profitable.

Ms. Fowlie, on page 11 of your document, in your message as executive vice-president of the Canadian Horticultural Council, you say:

An even more devastating blow was the mid-November announcement that Heinz would be closing its Leamington, ON facility in 2014, putting 740 full-time workers out of work. It has been estimated that for every job in the plant, there were 2.5 to four jobs created outside of the plant.

This is a very significant job loss. That business closed its doors after being in operation for 104 years.

What happened to the agricultural producers? I have been an agricultural producer. I grew small cucumbers for a company I won't name that also saw that it would be cheaper and more profitable to have their crop grown outside Canada.

Quebec producers—I am, indeed, from Quebec, from the Joliette region, which is my constituency—this entire agriculture industry was lost and, as a result, so were student summer jobs and the transformation that was occurring in the region.

What happened to all these producers? How did they reorient themselves?

[Anne Fowlie]

I am quite familiar with the situation your region experienced.

Some continued their activities, but on a smaller scale, or decided to grow other products, while others retired from the industry. If I'm not mistaken, an announcement was made in the past few months.

There will be another company that will carry on, but on a smaller scale.

It's a combination of things, but certainly It's very much an impact on the area. As you've said, there are all the ripple effects. You don't have the summer students. You don't have the additional revenue going into the community from all the spinoff industries. It's a combination of things.

Sadly, we've seen such a loss in our processing capacity, whether it's in Quebec and Ontario or in other parts of the country. That again is a concern. That's technology and investment that are going elsewhere, and certainly that's not what we need or want.

[The Chair, Conservative, Bev Shipley]

Thank you very much, Madam Raynault.

Now we'll go to Mr. Hoback for five minutes, please.