Agriculture Committee on May 5th, 2014

[Peter Watts]

That's right, but you need to be able to quantify that sustainability measurement. That's what we're trying to do at Pulse Canada. We're working with all the partners, the other associations, and the Canola Council, as well as with flax, wheat, and barley growers, to try to come up with tools to quantify the environmental impact of agriculture in Canada and to demonstrate what a great job Canadian farmers are doing in the area of sustainability. They're already doing a great job, but we can get better. That's going to be one of the big demands of the food companies in the future.

[Larry Maguire, Conservative, Brandon—Souris, MB]

I will turn now to Mr. Chesnais from Semex. Congratulations on your company's involvement in world trade as well, and the innovation that you've shown.

You indicated that you have, I believe it's 70% of the Canadian market in research areas in the dairy industry.

[Dr. Jacques Chesnais]

Yes. We have 70% of the genetics market and about 20% of the world market, in terms of our market share.

[Larry Maguire, Conservative, Brandon—Souris, MB]

You talked about hundreds of countries.

Are you exporting into—

[Dr. Jacques Chesnais]

Of course. In fact, we've grown quite a bit in the U.S. We have a higher percentage of the market in the U.S. than we used to. I think it's probably a bit less than 20% in the U.S., between 10% and 20%, I would say.

[Larry Maguire, Conservative, Brandon—Souris, MB]

What percentage would be in the EU?

[Dr. Jacques Chesnais]

In Europe, it depends on the country. We're doing very well, for example, in Spain, Germany, U.K., and some countries, such as Poland, and so on. It depends on the country, actually.

[Larry Maguire, Conservative, Brandon—Souris, MB]

What types of opportunities are you seeing there? What types of genetics are they looking for? Is it just in milk production, or also in livestock?

[Dr. Jacques Chesnais]

We feel that we've reached.... In Europe, it's going to be harder to increase our penetration of these markets, so we've turned more toward China, India, Brazil, and also some other markets, the Middle East and in other places.

[The Chair, Conservative, Bev Shipley]

You can wrap up, if you have a final comment. The time is up. Did you have any further comments to make?

[Dr. Jacques Chesnais]

No, that's fine. Thank you.

[The Chair, Conservative, Bev Shipley]

Madam Brosseau, for five minutes, please.

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

Mr. Watts, I'm a vegetarian, so I'm a big consumer of pulses, chickpeas, beans. My son often tells me, “I don't want any more beans, Mom. Let's fire up the barbecue.” He's tired of it.

I am wondering if you could comment on the programs that the government has in place right now, agri-innovation, agri-marketing. We've heard from some other witnesses that they would hope there would be more of a long-term vision. The programs are a few years right now. We've even had some witnesses talk about maybe a 10-year vision. I wonder if you could comment on that.

Also, maybe you could comment on what's up and coming in the world of pulses, what is hot in the world of beans. What kind of research and innovation needs to be done in certain cultures more than others?

[Peter Watts]

To begin with, I'm glad to hear that you're a big supporter of the pulse industry. That's great to hear.

Canadians get less than 2% of their caloric intake from pulses, compared with around 20% from cereals and 20% from meat and dairy products. We have a long way to go in terms of increasing pulse consumption here in Canada.

As some of you may know, in 2013, we had a record grain crop in Canada, and that included a record pulse crop. We had six million tonnes of pulses grown in Canada, nearly four million tonnes of peas, and two million tonnes of lentils. We have lots of pulses. Farmers like to grow them because they work well on a rotation and they are getting good prices for them these days.

What's hot is that more and more companies are looking to pulses, as a source of protein in particular, as well as fibre. As you probably know, pulses are about 25% protein, which is two or three times that of other cereals like rice, corn or wheat. Many companies are looking to pulses as a source of protein, and that's why companies like General Mills are incorporating pulses into their food products.

There is a new company in the U.S. called Hampton Creek that's making egg substitutes out of vegetable proteins. Their primary ingredient is pea protein. That's going to be a very small substitute for the one billion eggs they use every day in the U.S., but it's a very important market opportunity for Canadian pulse producers. It's that type of research and innovation.

Our Canadian producers and processors need to be able to meet the demands of these up and coming innovative companies that are emerging in North America and in Europe, but also in countries like China and India where consumers are very concerned about health. We talk about it in North America, but if you go to China, consumers are very knowledgeable about the importance of the link between diet and health and wellness. I think we have a great opportunity, not only in North America to expand pulse consumption, but also in markets like China.

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

My office is situated in Louiseville, Quebec. Every year we have a buckwheat festival, and two years ago, I was la présidente d'honneur. Buckwheat is something that we produce a lot of in my area. It's very important.

I was wondering if you could comment on climate change and how important it is, or on what kind of work you guys do for research and innovation, because we do see more and more unpredictable weather.

[Peter Watts]

As I mentioned, we have a project under way now with a consortium of Canadian agricultural organizations to develop a sustainable calculator tool. We're also working with companies. General Mills, for example, is involved in this project. So is Cargill, and so are a number of other companies and associations.

The reason these companies are interested is that they can see that consumers are looking for products that have a lower environmental footprint. Pulses fix their own nitrogen, and as a result they have lower energy requirements and a lower carbon footprint, so incorporating pulses into a rotation helps to lower the overall carbon footprint of your cropping system. What we're working towards is being able to quantify the sustainability of our cropping systems in Canada so we can provide that information to the food companies that are looking for it.

[The Chair, Conservative, Bev Shipley]

Thank you, Madam Brosseau.

I'll now move to Mr. Dreeshen, please, for five minutes.

[Earl Dreeshen, Conservative, Red Deer, AB]

Thank you very much, Mr. Chair.

I'd like to go back to what Mr. Hoback was talking about. There does seem to be this interpretation as far as research dollars are concerned. As we heard with the previous panel, they feel that what we are doing is exporting our knowledge. They don't look at it as though one of our researchers going somewhere else is a drain, because we have this reciprocity, and they're feeling that they're keeping the very best here.

I guess that's part of it. If we can manage to get this relationship that works properly between the clusters and the other dollars that are going into various areas, that's the way to go with it. I certainly appreciate that.

There's another area that I would like to talk a bit about. Perhaps, Mr. Watts, I'll go with you as a pulse producer.

I'm quite aware of the advantages we have as far as having pulses in our rotation is concerned. One of the things you mentioned, though, was the concept of the food processors and how they're going through this revolution of epic proportions in regard to some of the concerns we have on health, the new diets, and those sorts of things, as you mentioned, and how there are great advantages.

I don't deny the advantages, and I respect that, but when we talk about making sure that we let the consumers kind of tie in and we base everything on that, I relate it back to some of the issues that I see there. Of course, when we have situations where fruit, vegetables, and meat are considered to be more of a GMO concern than canola is—and there are studies that have shown this—we start to get the idea that perhaps there's a lot more being said about some of the things we produce than is actually accurate. So we do have the concerns that are associated with it.

I'm also a wheat producer, and you hear people suggest that you need to have these gluten-free diets and all of those things. If you have a gluten intolerance, then I agree, but some people are looking at fad diets, and they're taking some bad advice, in my estimation, in order to work this through.

Also, I'm afraid that when we look at it entirely from that perspective, we might find when we are making trade deals throughout the world that some of these things can also turn on it. Whether it's GMOs or blackleg in canola or rapeseed, sometimes these things are also used against us. I just want to make sure that as we go out and market to the nine billion people that are going to be in this world, we make sure the proper balance is there.

Could you perhaps comment on some of those issues?

[Peter Watts]

Sure. We would agree completely with you that there's a lot of misinformation that's out there about agriculture and about the agriculture sector, about how food is produced in Canada and elsewhere. You know, it's very easy for somebody to post a blog that's taken as a truth about the farming sector, and we all know that most consumers don't have a very good grasp of farming and of agriculture in Canada.

That's part of the reason, for example, we are working with this consortium of agricultural associations and companies in Canada to put information out there on how we're producing our crops in Canada. They're being produced in a very sustainable manner. Farmers have made a lot of advances and changes over the last 25 years, and that's not being recognized, so we want to make sure to get that information out there.

I completely agree that the gluten-free thing has gone way beyond where we might have expected it to go, to the point where people who really don't need to be on gluten-free diets have chosen to go on them, but that's the choice of people and consumers, and we have to respect that. We have an opportunity in the pulse industry to meet the market demand for gluten-free products, and for non-GMO products, in this case. We don't take the position, obviously, in the pulse industry against or for GMO products in particular, but there is an opportunity for the industry to meet these consumer demands. But we do want to make sure that the proper information is out there, and we are trying to do that as an association.

[The Chair, Conservative, Bev Shipley]

Thank you very much, Mr. Dreeshen.

I want to thank the witnesses for taking the time out today. Mr. Chesnais from Semex, and Mr. Peter Watts from Pulse Canada, thank you for your time and for your interventions.

We will take about two minutes while we move in camera.

[Proceedings continue in camera]