Evidence of meeting #45 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 research.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

Pierre Corriveau  Assistant Deputy Minister, Corporate Management Branch, Department of Agriculture and Agri-Food
Siddika Mithani  Assistant Deputy Minister, Science and Technology Branch, Department of Agriculture and Agri-Food
Tina Namiesniowski  Assistant Deputy Minister, Programs Branch, Department of Agriculture and Agri-Food
Greg Meredith  Assistant Deputy Minister, Strategic Policy Branch, Department of Agriculture and Agri-Food
Frédéric Seppey  Acting Assistant Deputy Minister, Market and Industry Services Branch, Department of Agriculture and Agri-Food

11 a.m.

Conservative

The Chair Conservative Bev Shipley

Colleagues, as you know, today we're here regarding Standing Order 81(5) and doing the supplementary estimates (B) for 2014-15 in regard to votes 1b, 5b, and 10b under Agriculture and Agri-Food, which were referred to this committee back on November 5.

Colleagues, with us today we are privileged to have the Minister of Agriculture and Agri-Food, the Honourable Gerry Ritz.

Welcome, Minister.

With him are a number of his colleagues from the Department of Agriculture and Agri-Food: Greg Meredith, Andrea Lyon, and Pierre Corriveau.

Welcome to each of you.

As you know, the minister is here for the first hour. The departmental folks are going to stay and will be with us for questions during the second hour also.

Without any further ado, we will move forward. I'll ask the minister to open with a statement, please.

11 a.m.

Battlefords—Lloydminster Saskatchewan

Conservative

Gerry Ritz ConservativeMinister of Agriculture and Agri-Food

Thank you, Mr. Chair.

It's great to be back at this committee. I'm joined today, as you said, by the deputy minister, Andrea Lyon; Greg Meredith, who is the assistant deputy minister of strategic policy; and Pierre Corriveau, assistant deputy minister of corporate management. This committee continues to do very important work for producers and processors in the broader Canadian agricultural industry as a whole.

We're meeting at a time of tremendous opportunity for our sector. It's estimated that farmers will need to produce 60% more food by 2050 to feed an anticipated population of some nine billion. In China alone the middle class is projected to grow by as many as 35 million people every year over the next decade. That's more than the population of our entire country on an annual growth basis.

Canadian farmers and food processors are well placed to address this growing demand, and the world is knocking at our door. Last year our agricultural exports topped $50 billion for the first time in our nation's history and they're 14% ahead of that pace this year. A recent study by Farm Credit Canada shows that Canada is now the world's leading agricultural trader per capita. That's a great track record, but we know our competitors are not standing still on global market access. That's why we're working hard across our great industry, across government, across the world, to keep Canada out in front on world markets. The supplementary estimates you have before you reflect that, with $4.9 million to CFIA to undertake activities to improve market access for Canadian agricultural products, and another $2 million to support the establishment of a Canadian beef centre of excellence to showcase our Canadian beef advantage to the world.

We're continuing our aggressive trade agenda. We were in China three weeks ago with the Prime Minister—my third trip this year—and a number of industry leaders. We were able to secure some key market gains, including an agreement finalizing access for Canadian cherries, valued at up to some $20 million a year; progress on access for Canadian blueberries, valued at $65 million a year; and a new contract for Canadian canola oil, valued at $1 billion. This builds on market gains achieved during our China mission in June, valued at some $400 million by industry members. In fact, our agriculture and food trade with China has increased fivefold since our government took office in 2006. China is one of a number of priority markets identified in collaboration with industry, through the Market Access Secretariat, which takes a holistic approach, bringing all government industry to the table to focus and grow our trade.

Hand in hand with our ground offensive, we have our government's aggressive trade agreement agenda. Since 2006, the government has successfully concluded negotiations on free trade agreements covering no fewer than 38 different countries. As a result, Canada now has trade agreements with more than half of the entire global marketplace, a total of 43 countries, while continuing to protect the pillars of our supply management system. The historic trade agreement with Europe will open the doors to the world's single largest market for food and food stuffs, boosting our agriculture and food trade by an estimated $1.5 billion per year. The agreement we signed with Korea, which is now reaching final agreement in the Senate, levels the playing field with our competitors and gives Canada its first ever foothold in the Asia-Pacific region.

Of course, if we are able to serve these markets, we need a predictable and reliable supply chain here at home. That's why, when the grain backed up last winter, we moved quickly with an order in council mandating minimum volumes for CN and CP, and with Bill C-30 to strengthen accountability information sharing throughout the system. I want to thank this committee for its hard work in moving Bill C-30 forward while ensuring we had a fulsome debate.

The Fair Rail for Grain Farmers Act puts into law clear and achievable solutions for the short term to ensure Canadian shippers have access to a world-class logistics system that gets Canada's agricultural products and other commodities to market in a predictable and timely way. Grain is moving. Exports are up some 25% over last year, and 32% over the five-year average. Deliveries using producer cars are also at all-time highs. As for the minimum volume requirements, we've said all along that the order in council will be there as long as it is needed. Our government will be making an announcement on any future requirements very soon, so stay tuned.

At the same time, we continue to work to ensure our logistics system is strong for the long haul. We accelerated the review of the Canada Transportation Act by a full year to focus on long-term structural issues affecting all rail transport including grains. The CTA review panel has been very busy through the fall meeting with a number of stakeholders to get a clear picture of the challenges facing the western Canadian grain handling and transportation system. A discussion paper was released in September, and we are encouraging industry to vet their thoughts by the end of this calendar year. We'll continue to work with Transport Canada and the whole value chain to manage future challenges, and create a rail supply chain that has greater capacity, predictability and accountability for the industry, and most importantly, for our global customers.

Transportation is one piece of this government's plan to modernize Canada's grain sector to stay in line with emerging 21st century realities. We're now working to build on reforms passed in 2012 to the Canada Grain Act as part of our commitment to marketing freedom.

We're also encouraged to see that the Canadian Wheat Board remains a viable and voluntary option for farmers who choose to use it as their marketing tool. The CWB is leading the process toward its own commercialization. The act requires the CWB to submit a plan to government, and we're certainly encouraged to see that they have actively moved forward to become a private, independent organization that can meet farmers' needs in this competitive sector. A viable and voluntary CWB, along with our aggressive trade and innovation agenda, will mean a stronger farm gate and a rich harvest for Canada's economy.

The other key to competitiveness is, of course, innovation. Farmers must have the latest tools to compete in the global marketplace. That's why we're updating plant breeders' rights under Bill C-18. The agricultural growth act will strengthen intellectual property rights for plant breeders so Canada can catch up with the rest of our competitors. This is supported by every relevant farm group across Canada. Aligning our regulations will not only level the playing field for our producers but it's also expected to encourage foreign breeders to release their varieties in Canada. This will give our farmers access to new varieties that their competitors are already using.

Entrenched in Bill C-18 is, of course, the right for farmers to save, clean, and use seed for their own operations.

Finally, Mr. Chair, innovation takes investment, and that is reflected in these investments, with the allocation of a further $41.7 million for Growing Forward 2 cost-shared initiatives including innovation. Growing Forward 2, which is now hitting its mid-season stride, is backed by a 41% increase in funding on science and innovation throughout the agricultural sector. That's helped us almost double our support of the industry-led research clusters to some $125 million and to add four new clusters. At the same time, our business risk programs are there to backstop producers such as Manitoba livestock producers suffering feed shortages following another extremely wet growing season.

As always, expenditures are driven by demand. Business risk management programs can fluctuate depending on the needs of Canadian producers. This fluctuation will impact our spending numbers, which will be lower if demand for the BRM programs is lower.

To close, Mr. Chair, as does this committee, I remain very optimistic about the future for agriculture. Canadian farm cash receipts totalled almost $42 billion for the first three quarters of this year, which is an increase of almost 3% over the same period last year.

The long-term fundamentals of the industry are good with growing populations and incomes and great products to sell.

I look forward to working with you as we drive new opportunities for our industry and new growth for our economy.

Thank you, Mr. Chair. I look forward to any questions or comments.

11:05 a.m.

Conservative

The Chair Conservative Bev Shipley

Thank you very much, Minister.

With that, colleagues, we'll start our rounds with Madam Brosseau.

Go ahead for five minutes, please.

November 27th, 2014 / 11:05 a.m.

NDP

Ruth Ellen Brosseau NDP Berthier—Maskinongé, QC

Thank you, Chair.

Thank you for your statement, Minister. We greatly appreciate your presence here today.

I also want to thank you for having voted in favour of my motion M-496.

I would like to know when you are going to share the details with dairy producers everywhere in Canada, so as to reassure them and let them know we are not going to let them down. During the last recess week, with Minister Bernier and member of Parliament Mr. Gourde, I had the opportunity to take part in a round table regarding compensation for Quebec dairy and cheese producers. I would like to know when you might be ready to show us the details of a compensation plan for the dairy sector.

11:10 a.m.

Conservative

Gerry Ritz Conservative Battlefords—Lloydminster, SK

While I understand your question and your concern, Ms. Brosseau, I'm a little puzzled by the timeliness. Certainly producers and processors know for certain that this government will be there to backstop them should there be any negativity around the CETA agreement that we have now signed off on.

We have an almost seven-year transition period in that timeframe to work out the details to make sure that processors and producers are well equipped to handle any potential negativity that may come their way. At the same time, they have unlimited access into the European market, and I know from the events that happened around the SIAL food show in Paris just a couple of weeks ago, the industry was well represented with some great cheeses produced in Quebec and other points in Canada. They received awards. They continue to make great inroads into that marketplace.

It's a bit of a balancing act. It's one of those situations in which there is no negativity at this point. There is nothing for us to offer up cash for at this point, but certainly we're working with the industry overall. I work with Dairy Farmers of Canada as well as with the processors to ascertain the best way forward to keep the industry strong.

11:10 a.m.

NDP

Ruth Ellen Brosseau NDP Berthier—Maskinongé, QC

Thank you.

I have a slightly more complex question regarding a matter of high importance to the Quebec agri-food industry.

The Fondation des entreprises en recrutement de la main-d'oeuvre étrangère, FERME, held a press conference where we learned that losses for 2014 have been assessed at $53.7 million. These losses are due to fruit and vegetables not being harvested by temporary foreign workers. This is jeopardizing our agricultural enterprises.

I also had the opportunity to meet with several producers from my riding who stressed the fact that the federal government changed the requirements for the Temporary Foreign Workers Program right in peak season.

That organization is attempting to meet with various federal government representatives so that they have some confidence in what to expect next year. Their representatives feel that it will still be difficult in 2015 to have access to temporary foreign workers who will work in the fields, on the farms.

I would like to know whether you would be willing to meet the director general of the FERME group, Mr. Hamel. Losses of $53 million are painful! I would like to hear what you have to say about a potential meeting with Mr. Hamel.

11:10 a.m.

Conservative

Gerry Ritz Conservative Battlefords—Lloydminster, SK

I am always happy to meet with any farm organization across Canada regarding issues.

I'm puzzled by the fact that there are absolutely no changes to the temporary foreign worker parameters or the ability to obtain those workers, because primary agriculture is not affected by any of the changes that have been brought forward at this point. I'm a little puzzled by the fact that they would have losses because they couldn't get workers. I don't know what their point would be, but I'm happy to meet with the president.

11:10 a.m.

NDP

Ruth Ellen Brosseau NDP Berthier—Maskinongé, QC

That is why it is important that that meeting take place. It is clear that the last-minute changes really prevented farmers from hiring workers from Guatemala and Mexico. This would be a very useful meeting, one that would allow participants to tell you more about the problems they overcame this year.

I would like to ask another question. Do I have time?

11:10 a.m.

Conservative

The Chair Conservative Bev Shipley

Unfortunately, no.

Thank you, Madame Brosseau.

Mr. Lemieux, you have five minutes.

11:10 a.m.

Conservative

Pierre Lemieux Conservative Glengarry—Prescott—Russell, ON

Thanks, Mr. Chair, and thank you, Minister, for being here. I thank you for your opening remarks.

Certainly, one of the things I took away from your opening remarks was that it's an exciting time for agriculture, particularly in terms of science and innovation, Bill C-18, as well as trade, with our upcoming trade agreements.

Let me first ask about innovation and science. In reviewing the estimates, I noticed that there's going to be an additional 30 million dollars' worth of funding, which will bring a total of $549 million for science and innovation. I noticed that the industry capacity fund is going to increase to $78 million. I noticed that market access initiatives are going to increase to $223 million.

We're going to see increases, because of the estimates that are in front of committee right now, in those three areas. Just a quick cigarette-pack calculation, this is close to three-quarters of a billion dollars in improving the competitiveness of our farmers to both compete in Canada and sell abroad. On top of that, we have, of course, Bill C-18, which just passed through the House.

Could the minister explain to the committee the importance of the increase in funding that we're talking about here through the estimates, and also the importance of science and innovation, and the government's focus on science and innovation in making the agricultural sector more competitive, particularly at the farm gate?

11:15 a.m.

Conservative

Gerry Ritz Conservative Battlefords—Lloydminster, SK

The easiest way to explain that, Mr. Lemieux, would be: build it and they will come. Canada is well recognized around the world in emerging markets, as well as some of our primary markets like the U.S., for the safety and sustainability of our farm products.

We also have a great story to tell when it comes to our environmental footprint. I know in my own farming experiences, with the land that I've farmed with my brother and that my nephew is now farming—it's the same land, the same acreage—he's now pulling in at least a 40% gain, if not double the crop production, that we were 10 to 20 years ago simply by a lot of assessment work done on the ground as to what trace elements are required. Now it's a lot more finesse in seeding.

Crop rotations are a big part of that, but making sure that the copper, the sulphur, the manganese, the trace elements are addressed. I mean, we used to look at 35 bushels an acre of canola as a really good crop. He's now in that 55 to 60 bushel range, doing exactly the same things with those trace elements, the timing of crop rotations, and so on. That's what a lot of the innovation is about. We don't have extra land, but we certainly have the ability to gain more from that land and still continue with that lighter environmental footprint.

We know we're able to produce it and we know there's a hungry market out there. As I've said, China is growing by the population of Canada every year in the middle class. As I often say, if everyone in the middle class in China had a bacon cheeseburger and a beer once a month, we couldn't supply it as a country. That's the size and scope of what's going to be required.

Our latest venture to China....a brand new group out of Toronto has connected the dots with distributors in China, another billion dollars' worth of canola. That's half of our market access into China is canola oils, so this adds to the success of those type of ventures.

To make that all happen we've embedded agricultural people, CFIA people, in emerging markets like China, around the world. We've just added another number of trade centres in China to get us further out from the Beijing-Shanghai-Guangzhou triangle. It's all very important work and it's paying dividends.

11:15 a.m.

Conservative

Pierre Lemieux Conservative Glengarry—Prescott—Russell, ON

Thank you, Minister. You've certainly convinced me on the importance of science and innovation. I hope you've convinced the opposition MPs to support the estimates and the increased funding for science and innovation.

Let me raise one other issue in the few minutes that I have left, Minister, and that is the Canada-Europe trade agreement. I think this is an exciting opportunity for agriculture. I think it's absolutely germane that you comment on it because the House has sent our report, an excellent report, back to committee and asked them to consider an amendment to the report to make it even better and send it back to the House, which we're going to be doing in the next few meetings.

Minister, I'm wondering if you could elaborate to the committee on the opportunities you see CETA offering our Canadian farmers and the benefits that they would accrue through this important trade agreement.

11:15 a.m.

Conservative

Gerry Ritz Conservative Battlefords—Lloydminster, SK

The whole European theatre is one of the largest consumer food buying groups in the world, with some 500 million people. With the completion of that free trade agreement, coupled with NAFTA with the U.S. and so on, it gives us access to half of the growth in food demand in the world. We're quite happy with that.

Europe is an opportunity for a lot of our processors to have access to high-end goods. This is not just a hamburger operation over there. They're looking for the better cuts in our pork and in our beef. They're losing the capacity to supply their own people, as land goes under pavement, and as their urban centres grow. We have the capacity here, the unlimited amount of land and fresh water, and of course the innovation and ability of our farmers to produce.

They're happy with the agreement, as are we. You know you're always going to see the naysayers get the ink in the press, but at the end of the day all of my contacts that I've developed over the past five years as we've worked this through are extremely happy with being able to have this agreement with Canada.

11:20 a.m.

Conservative

The Chair Conservative Bev Shipley

Thank you very much Minister.

Now we will move to Mr. Easter. You have five minutes, please.

11:20 a.m.

Liberal

Wayne Easter Liberal Malpeque, PE

I'm probably not as easy to convince as the parliamentary secretary.

In any event, Mr. Chair, just on the temporary foreign worker program, and I know this is not your jurisdiction, Minister, but I just will point out to you a problem there is, I think, in a number of areas. It was raised by a member from the NDP.

Yes, it's true that agriculture workers are protected, but those who are in the plant are not. As an example, you mentioned blueberries opening up in China, and that is a good thing. We will congratulate you on that.

On the blueberry operation in P.E.I., the workers who are in the field are protected, but the ones who are in the plant are not. I believe in that operation somewhere around 60% of the workers are temporary foreign workers, so it is a problem on the processing side. It's not your area. It's another minister's area, but you should be aware of it because it is a problem and it could affect the ability to get the product through and shipped. I'm not asking a question on that, I'm just pointing out that it is a very serious concern, and it's a concern in the beef industry as well, which you would know of in some of the plants in Alberta.

11:20 a.m.

Conservative

Gerry Ritz Conservative Battlefords—Lloydminster, SK

Right.

11:20 a.m.

Liberal

Wayne Easter Liberal Malpeque, PE

As you know as well, on October 1, the U.S. protection we had for the fruit and vegetable industry under U.S. law with respect to bankruptcy risk—

11:20 a.m.

Conservative

Gerry Ritz Conservative Battlefords—Lloydminster, SK

The PACA provision.

11:20 a.m.

Liberal

Wayne Easter Liberal Malpeque, PE

Yes. That's not there now. Industry has asked for, I think, they called it a Canadian perishable commodities act. Where do you sit on that? I know there have been discussions. They are insisting it has to be a perishable commodities act. Why is the government not looking at it? If you are, when can we see it?

11:20 a.m.

Conservative

Gerry Ritz Conservative Battlefords—Lloydminster, SK

Just on the temporary foreign workers, you're right to point out that the choke point is processing. I absolutely agree with you on that.

I know there's some work being done by two of my colleagues, Jason Kenney and Chris Alexander, with the provinces in order to work on the express entry and provincial nominee programs, to bring in the skill sets required for those. The problem is that there's never been a definition beyond “agricultural worker”, the guy that picks or the guy with the fork. We're working on that to partner with the provinces as to how we bring people in for those skill-set agricultural jobs in processing, and not through the revolving door that the temporary foreign worker program was. They're buoyed by that, and I know there's some work being done on that.

On the PACA issue, as you will know, it's not an agricultural issue. The horticulture industry certainly is us, but the actual issue is industry and finance, at the end of the day. I know there are discussions going on and a report that's just coming in—it's imminent—on the bankruptcy act and how this type of thing could be put in play so that perishable goods could have that first right.

There are discussions going on with provinces as to what changes would need to be made at the provincial level, as well as what umbrella would be needed at the federal level in order to recapture that. One of the things that would be quite easy to do, which the industry seems to not respond well to, is a check-off on product going out and product coming in from the U.S. that could be put and matched with government funding to create a pool.

The PACA is a great backstop, but it's not well used. It triggered some $7 million over the last five years, and of course, we're doing a couple of billion dollars a year in trade. When you look at $10 billion or $12 billion in trade, and $7 million is what was required, certainly a check-off administered by the Farm Products Council or something like that could be part of the solution quicker than some of the legislative changes that are needed. But we're looking at it all.

11:20 a.m.

Liberal

Wayne Easter Liberal Malpeque, PE

I think the industry, though, is not in favour of the check-off. They've told me that very clearly. They do favour a perishable commodities act.

I met with the Ontario section of the Canadian Cattlemen's Association, and they're quite frustrated with your government's cut to AgriStability and AgriInvest. They're worried when AgriStability will be needed it will not meet the needs of the Ontario cattle industry. That's one thing you can respond to.

Secondly—

11:25 a.m.

Conservative

The Chair Conservative Bev Shipley

You're only going to get one, because your time is up, so I'll ask the minister to respond, please.

11:25 a.m.

Liberal

Wayne Easter Liberal Malpeque, PE

—where are you at on production insurance?

11:25 a.m.

Conservative

Gerry Ritz Conservative Battlefords—Lloydminster, SK

Are you talking RMP?

11:25 a.m.

Liberal

Wayne Easter Liberal Malpeque, PE

Yes.