Agriculture Committee on Sept. 18th, 2018

[The Chair, Liberal, Pat Finnigan]

We'll get going. I hear that there might be a vote happening soon. We'll try to get all we can in the time we have.

I want to welcome, by video conference for our second hour, Ms. Leanne Fischbuch, executive director for the Alberta Pulse Growers Commission. I hope I pronounced your last name correctly.

Also, from Niagara College, we have Dr. Michael Duncan, Natural Sciences and Engineering Research Council industrial research chair for colleges in precision agriculture and environmental technologies; Sarah Lepp, senior research associate for research and innovation; and Gregor MacLean, research project manager for research and innovation.

Welcome to all of you.

We'll start with opening statements of seven minutes. If you want to start, Mr. MacLean, go ahead.

[Gregor MacLean, Research Project Manager, Research and Innovation, Niagara College]

I'd like to thank the Standing Committee on Agriculture and Agri-Food for having us here today. We represent Niagara College, and specifically the Agriculture and Environmental Technologies Innovation Centre. On my right, we have Dr. Michael Duncan, Natural Science and Engineering Research Council of Canada's industrial research chair for precision agriculture and environmental technologies. We also have Sarah Lepp, senior research associate. I'm Gregor MacLean, project manager.

What's great about working at Niagara College is, of course, the fact that we have excellent infrastructure, staff, faculty, students and graduates who support and execute our work. Sarah and I are two of the graduates. What's great is that, despite the fact that we're based in Niagara, in southern Ontario, we work with Canadian companies and have impacts across the country, and our partner companies have impacts across the world.

As a refresher, I think all of you know, but it's important to start by indicating that modern farms are businesses. They need to generate revenue, and with that revenue they also need to make a profit. More and more, to do that in a very competitive commodity market, they need to use the data and technology available to them and, in a lot of cases, that's captured under one banner called precision agriculture, smart agriculture, as Stuart was talking about. That's the area we work within, precision agriculture.

We do three things: We build software, whether that's phone applications, web applications or desktop applications; we work with hardware, moving and automated robotics, drones or UAVs, as well as installed environmental sensors; and we work with data, whether that's processing or analytics, turning all that information into wisdom, information that could help farmers make better decisions in their farm businesses.

Ultimately, we are doing work in three primary crop areas: hazelnuts; grains, which are corn, soybeans, and wheat; as well as vineyards, grapes. Those are not the only things we're willing to work on, but that's what we've been doing for the past number of years. We're willing to expand as well.

I'll just go over a couple of project examples to help folks understand what we can do and the type of work we do. First, one primary collaborator right now is Ferrero. You might recognize them as one of the world's largest confectionary companies. They make the delicious Nutella, the chocolate hazelnut spread, and Ferrero Rocher, the delicious hazelnut chocolates.

As you can imagine, they buy a lot of hazelnuts. They're the world's number one hazelnut buyer, and the bulk of those hazelnuts come from the country of Turkey. You can imagine that, if Turkey has environmental, economic or any sorts of issues, those could affect Ferrero's supply. Well, it's a really great thing that Ferrero also has a plant that employs over 1,000 people in Brantford, Ontario. With that plant's strategic location, they're looking to see 20,000 acres of hazelnuts planted in Ontario in the next 10 years.

We're collaborating to support that work in two ways. There are long-term historic climate and future climate modelling studies that we're building into proprietary software we're creating with our programming team members for Ferrero. They'll provide that to their clients and their potential farmers for a new high-value crop for Ontario farmers that could be worth anywhere from four to ten times the current cash crop revenues. Also, the export opportunity is a new high-value crop, raw, going outside of Canada. More importantly, it's a value-added crop going throughout North America and Australia that comes from Brantford.

The second project I'll discuss is a great example of our working directly with a farmer. At Yellow Gold Farms, Rick Willemse, who is in Parkhill, Ontario, outside of London, farms over 1,000 acres of cash crops: corn, soybeans and wheat. A number of years ago, he created a very innovative precision agriculture variable rate algorithm and process. People wanted to buy it from him to use it. The problem is, he is a very busy person. He's always needed, and he doesn't have the time to do that work. If he provided the spreadsheets, as you can imagine, somebody would steal his secret algorithm. With our data and software expertise, we built that algorithm into web software for him so that he's able to commercialize it as an export software product or as a domestic software product, giving him a diverse income to his farm operation.

The final project I'll discuss is with a company called SoilOptix. They are out of Tavistock, in western Ontario. They offer a proprietary soil health technology. They drive over a field to collect soil health data, and after that's been done, they take seven to eight hours to process the data. Whether the field is 10 acres or 100 acres, it takes seven to eight hours. As you can imagine, that's a bit of a long time.

We've collaborated with them over the past 10 months. We've cut that time down to 30 to 90 minutes, which is 60% to 90%. The high-valued and high-skilled jobs to process that data are still happening in Tavistock, Ontario, not to mention that their hardware and service technology is being exported around the world: China, Argentina, Brazil, the United States, as well as across Canada. We're helping them to scale that technology while maintaining the jobs in Ontario, and we've seen the workforce double in the last year as well.

You see that the work we do helps farm profitability. It helps them be efficient with their resources, including fertilizers, as well as how they spend their dollars and understand the ROI provided based on technology. Ultimately, it has improved sustainability and business practices to help the farmers make better decisions, whether it be about soil or weather impacts.

This work would not be possible without our funders at the federal level, the Natural Sciences and Engineering Research Council, and our excellent contacts Marie and Marion. At the provincial level, there is the Ontario Centres of Excellence and Padraic, Richard and Alexandra. And of course there's Colleges and Institutes Canada, the base funding they support us with and the internship funding.

We are excited to discuss any questions you have, as well as potential future directions we have in moving and automated robotics.

Thank you.

[The Chair, Liberal, Pat Finnigan]

Thank you, Mr. MacLean.

There are about 30 seconds. I don't know if anybody else wanted to interject or if that's okay with the group. We'll have questions anyway.

Now, from the Alberta Pulse Growers Commission, we have Ms. Leanne Fischbuch.

You have seven minutes.

[Leanne Fischbuch, Executive Director, Alberta Pulse Growers Commission]

Thank you, Mr. Chair.

My name is Leanne Fischbuch. I am the executive director of the Alberta Pulse Growers. Farmers elected to our board represent over 6,000 producers of pulse crops in Alberta. These crops include field pea, dry bean, lentil, chickpea, soybean and faba bean.

Our members support our organization through a refundable levy on the cash sale of pulses. The funds are invested in research, market development, extension and communications to increase the profitability of pulse crops for producers, and to increase the knowledge and acceptance of pulse crops by the consumer.

I am pleased to provide comments to you today on the topic of research and development to encourage Canadian exports. In the interest of time, I'd like to focus on a few of the topics, namely trade, policies and programs, and regulatory frameworks.

Alberta has the second largest number of acres and amount of production of pulse crops in Canada. Within the province, field pea is the predominant crop, followed by lentil, faba bean, dry bean, chickpea and soybean, totalling approximately 2.1 million metric tons of production worth $604 million to Alberta producers in the 2017-18 crop year. In 2016, Alberta exported more yellow peas than any other jurisdiction in the world.

Canada does not consume its pulse production. Canada has been the largest exporter of pulses, at 41% of the marketplace for years. This has been a good news story for the Canadian industry, with growers growing more pulse crops and increasing export opportunities.

Currently, however, the industry is experiencing market access challenges with India, which is traditionally our largest importer. Prior to the slowdown in Canada's largest market, in 2017 the Canadian pulse trade had delivered over 7.1 million metric tons of pulses to over 130 markets across the globe. We recognize that other countries are taking a run at our numbers, and we need to work to make sure we can continue to sustainably grow our production and take it to market.

APG's goal is to have pulses included once every four years in each farmer's rotation in Alberta to obtain a three-million-acre production. In addition, we are working with our national organization Pulse Canada to diversify our market opportunities, which includes broadening opportunities for trade of primary products and supporting inclusion of pulse ingredients in pet and human foods, aquaculture and feed in our 25 by 2025 strategy so that growers have markets for their production.

APG supports the efforts to act on “Unleashing the Growth Potential of Key Sectors”—the Barton report—to increase Canadian agricultural exports from fifth place to second place. We see the need to diversify and expand opportunities with our pulse crops.

Discovery, development and marketing of new products take investment. As a grower organization, we use our funds to address questions and capitalize on bringing solutions to our growers. We cannot do this alone. There is a significant need to collaborate with others who are bringing resources such as funding and people to the table.

APG has participated via Pulse Canada in accessing AgriMarketing program funding, and more recently AgriScience cluster funding. APG committed to providing nearly $2.3 million in matching to the $11.1 million in pulse science cluster support from the federal government, which allows our industry to tackle priority research that growers would not be able to fund on their own.

The recent announcement of the success of the Protein Industries Canada supercluster application is also encouraging, and APG is waiting to learn how that funding will be implemented and how we can match our objectives. It's critical to have programs pairing industry investment with public investment and allowing industry to address issues that form a foundation to build upon to meet global and domestic opportunities.

While research addresses problems that are holding the industry back, there are many other areas that impact the ability to grow pulses and reach out to capture export opportunities. There are regulatory challenges that can reduce the potential success of the industry to reach both export and domestic value-added opportunities. These include the following.

First, with respect to transportation, Canada's reputation as a leader in global exports is easily compromised when product is unable to move to market. Systemic rail transportation failure has eroded Canada's brand and trust from international customers of our agricultural commodities. If export opportunities are to be part of the path forward for growth, then transportation needs to be a priority.

Second, the Pest Management Regulatory Agency is challenged with resource shortcomings, such as people and funding, and needs to have its processes reviewed. APG recognizes the importance of the PMRA and its role; however, the agency also has the potential to limit expansion of the pulse industry and significantly affect its future.

Third, it should be a priority for the Canadian Food Inspection Agency to be a global leader in exports, recognition of scientific standards and global harmonization. The codex for maximum residue limits or continued efforts on low-level presence detection can be a challenge with the potential to lead to market access issues. If global export is a key opportunity for expansion, APG would support the CFIA's prioritizing work in this area.

Finally, environment and climate change legislation has an impact on growth and opportunity for the agriculture sector. APG recognizes that farmers who incorporate pulses have a positive influence on the environment, such as reducing the use of synthetic nitrogen and reducing greenhouse gas emissions. Even Agriculture and Agri-food Canada supports pulse crops being added to rotation as part of a beneficial practice to increase carbon in the soil. Farmers are stewards of the land and want to do the best possible management to keep it healthy and viable for future generations. Carbon taxes in a global environment put Canadian exports in an uncompetitive position against others who can supply product at a lower cost due to less regulation. A regulatory impact analysis on the agriculture sector needs to be investigated prior to adopting further legislation.

Canada's agriculture future continues to be export-focused. For the pulse industry, our small national population will never be able to eat its way through Canada's production of pulses. That said, Canadians do need to increase their consumption of this healthy and nutritious product for the many benefits pulses provide. However, export will continue to be the primary objective, with domestic value-added production secondary, in order to consume the tonnage that is being produced.

Alberta's pulse farmers see value in the research supporting innovation and opportunities that will ensure they are able to maximize yield, deal with agronomic issues and produce a consumable product while continuing to keep the health of their land in the best shape possible for the future and supplying an export-ready product to the global marketplace.

Acceleration in trade, continued investment in research, and reduction of obstacles to growth such as regulatory challenges are all part of the path forward.

Thank you for your time. I welcome questions.

[The Chair, Liberal, Pat Finnigan]

Thank you, Ms. Fischbuch.

We'll start our questioning round with Mr. Dreeshen, for six minutes.

[Earl Dreeshen, Conservative, Red Deer—Mountain View, AB]

Thank you very much, Mr. Chair.

Thank you to the witnesses for being here today.

First, I would like to talk to the Alberta Pulse Growers about some of the issues Leanne brought up. Of course, our main study is on how technology can support those who are going to be exporting our great products around the world. We have the bulk pulses that we are sending, and it looks as though in the future we should be looking at some refined products as well, doing a little bit of that here.

Perhaps you could let us know a bit about how those two are working together. That would be important.

Again, as someone who has produced pulses in the past, peas primarily, I know there are issues, a major one being what has taken place with India, the tariffs that have been put in. The other aspect is the fumigation situation. We understand, as we look at the temperatures that we have in Canada, why the need for fumigation is different from what other countries importing into India would suggest.

Could you give a bit of an update on where the trade issues are, specifically with India, but also with the confusion that is taking place at the moment with worldwide tariffs, and give us a feel for what is happening there?

[Leanne Fischbuch]

Thank you, Mr. Dreeshen, for your question.

I'll talk a bit about the first part of your question, on bulk and refined products. When we talk of bulk processing, it's really cleaning the product and then shipping it in large quantities to port and off to the globe. These are the majority of the ways, for example, that peas are moved throughout our system in Canada. For refined products, we would love to see more value-added opportunities created within the Canadian sector. For us, when we look at value-added opportunities, it means fractionation. It means taking the pea, for example, and splitting it into the valuable components, such as protein, starch and fibre.

If we are able to do this type of fractionation eventually, we should be able to attain a higher-value product when we sell into the marketplace. With that type of refined product, if we had the opportunity to attract more companies into the Canadian industry interested in doing this—and it does take money, investment capital and other things, to attract companies—I think we would like to see it.

In Manitoba, we have Roquette coming in—they've broken ground—which is a large processor of fractionated product. We have others that hopefully will be attracted to coming to Canada. My colleague in Saskatchewan is currently in China, and he has had some excellent meetings talking to potential people who are interested in coming and perhaps setting up shop in Canada to do these types of fractionation methods.

For an update on our tariff challenges with our number one importing country, Canadian pulse producers are still subject to tariffs into India. We are under a restriction in terms of the amount of product even going into India. It's a quantitative restriction of 100,000 tonnes of product going in. That has been extended to September 30. At one point—I think it was at the end of August—there was one day when the Indian government lifted the restriction. It caused some excitement in the marketplace, but they immediately closed it down the next day.

The challenge we have with trade with countries like India and how they have treated Canada—and I'm going to say more than Canada, because globally they've inflicted this on many countries they import from—is that they are very unpredictable. This has become a challenge for exporters and farmers.

Initially, in November 2017, when they enacted their tariff on peas, the price dropped for producers by about $2 a bushel. What that equated to for us over the course of the year was an immediate pause for producers to decide what they put into the ground. They dropped their acres this past year. We went from 2.7 million metric tons of production in 2016-17 down to 2.1 million metric tons in 2017-18, and basically took about $300 million away from producers due to that change in access and pricing.

The situation with respect to India now is that we're still under reduced ability to export. We did have an Indian delegation last week with Pulse Canada, and they travelled through Canada to see our supply chain for pulse crops. They visited a farm. They visited a processing facility, and they went out to the port to see the full movement of the product through the marketplace.

While I haven't had an immediate update from Gordon Bacon of Pulse Canada on this, I feel it was really important for the Indian delegation to come out and see how we treat our product, to observe whether we have the problem weeds and things that they consider we have and that's why we would have to fumigate, and then to understand at the ports why we can't—

[The Chair, Liberal, Pat Finnigan]

Ms. Fischbuch, I'm sorry to interrupt. We're out of time for this one, but I'm sure there will be others who will ask questions.

Thanks, Mr. Dreeshen.

Mr. Breton, you have six minutes.

[Pierre Breton, Liberal, Shefford, QC]

Thank you very much, Mr. Chair.

Of course I'm very pleased to see my colleagues and all the staff today, and to continue to work together for Canada's agricultural industry.

My thanks to the group of witnesses for being here.

My question is for representatives from both groups.

Ms. Fischbuch and Mr. MacLean, in your presentations, you mentioned how important research and development is in the industry. As we know, the goal was $75 billion in exports in the agricultural industry. Innovation in the agricultural and agri-food sector is an indispensable tool in its growth and development.

Could you please take turns, starting with Mr. Maclean, and tell us how important research and development is?

Could you also tell us how the government could be a better partner and contribute to this vector, which is really important and which gives rise to innovation and new technologies, to improve the competitiveness and productivity of our agricultural producers?

[Gregor MacLean]

Thank you for the question.

I will answer in English. This is what I have to say about research.

In world commodity markets, precision agriculture can make a difference of 5% to 10% cost savings on fertilizer. It can mean a lot of increased yields as well. That's really where the wins are to be found for us. It's important that Canada stay ahead of things by being the first to adopt technology, because ultimately it means savings in the cost of production. That's where we come in, doing the programming of the software and robotics for those cost savings. Ultimately, we have amazing natural capital and great soil and water resources.

As has been noted at events we've attended with people from around the world, we have some of the most advanced farming and agronomic minds. I think the government can continue to support the development of technology for farming, as it does right now.

[Pierre Breton, Liberal, Shefford, QC]

Your organization has some eminent experts. That work must be paid for. I also know that the farms that do business with you must fund some of the research and development.

Research and development credits exist in Canada. Is the program well tailored? Could it be improved?

Mr. MacLean, can you tell us how you and your organization see things?

[Gregor MacLean]

It depends on the organization.

We are funded at the provincial, federal and regional levels. It's up to our partners whether they use the SR and ED credits or not. We do our best to provide the most ROI for the work we do. I don't know the level of adoption. Ultimately, it has been quite good, from our experience. We also work with commodity organizations, such as the Grain Farmers of Ontario, to utilize many producers' dollars. We also help to reduce the cost of adoption in considering what technology they pick up.

[Michael Duncan, Natural Sciences and Engineering Research Council Industrial Research Chair, Colleges in Precision Agriculture & Environmental Technologies, Niagara College]

We've done a lot of projects where there's no cost, so we have a kind of pro bono approach. We actually find that the adoption rates are higher when somebody has to pay for something, because they tend to value it more. People who are willing to pay also tend to go deeper into the technology. They're interested in further exploring statistical techniques and different things.

I wouldn't say that the adoption rates of technology are very high right now. There are a lot of farmers who are still doing the blanket fertilizers and blanket coverage, and they don't want IT infrastructure on their farms. They don't want to become IT professionals. As was mentioned in the previous session, there's the thought that we're going to be moving more IT technologists onto farms, but I'm not sure. Each farm is a business and each farmer is the CEO, and whatever philosophy they hold with regard to technology is very hard to overcome. I don't know if money is the thing, or more public infrastructure that they can tap into.

One of the approaches we took very early on was to build cloud-based technology, for the simple reason that it allowed us to project whatever power was necessary, because we can afford the computers and can run them. We have the students who can do the administration, the programming, and all the development of technology that's necessary. Then we can project it right into the farmer's farm, as long as they have a cellphone, a tablet, or a computer of some kind. That eases the adoption of technology by farmers. Because we can provide that service at no expense, it may help them poke around and see what they like doing. We have a crop portal that helps process farm data. We've had it for about three or four years. Is that right?

[Sarah Lepp]

It's been six years.

[Michael Duncan]

Oh, okay. I've been there for a long time. Sarah built it, actually.

We've had that in place, and we're getting more farmers coming in, maybe a couple a month, kind of impromptu tire kickers who come and look to see what the technology has to offer. They might continue, or they might pull back and say, “It's really not for me.”

[The Chair, Liberal, Pat Finnigan]

I'll have to stop you there. Thank you.

Merci, Monsieur Breton.

Mr. MacGregor, you have six minutes.

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

Thank you very much, Chair.

Mr. MacLean, I think our names are having a competition to see who can be more Scottish. We'll do a draw there.

In your opening comments, you made reference to vineyards as one of the areas Niagara College is looking at.

Where I come from, Vancouver Island, the Cowichan Valley is easily home to most of the vineyards on the island. It's a fantastic value-added industry. We're certainly not on the scale of what you see in the Niagara region or in the Okanagan, but it's still a very important local economy for us. Certainly, I know some are interested in seeing their exports go to other countries, because we do have some fantastic wines.

Can you talk a bit about your research, technology, and innovation in vineyards?

[Gregor MacLean]

We're fortunate to have a 40-acre vineyard at our Niagara on the Lake campus. There are two programs taught there: winemaking and grape production or oenology.

Our work has involved second-to-second weather tracking, with the intention of predicting harmful weather such as cold drops. That's Dr. Duncan's background, weather physics. We've also looked at communications between ground robotics and aerial photography and data capturing, to better understand and predict diseases happening in the vineyard. If a perennial crop dies—temperature could kill it, and disease could kill it—it takes three to four years for production to come back. A lot of it is predictive work. The other piece we're working on is enhancing staff members or team members on the ground with robotics—not replacing them but enhancing them with follow robotics or data-gathering robotics.

[Michael Duncan]

For the robotics piece, a lot of people are playing with UAVs, which look at grapes from above, and from the top of the canopy you really can't see anything. The idea was that if we had roving robots with cameras pointing upwards, that's where we could see powdery mildew, leafrollers, and all the various diseases that grapes have. It's a much more effective way.

There's going to be a new kind of workforce, I think, a Game Boy kind of approach, with independent rovers moving around the field. You could be in an air-conditioned hut with an enhanced rover running around the field. You could still have people doing the work; they would just have a different kind of job.

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

Thank you.

[Gregor MacLean]

May I add one thing?

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

Yes.

[Gregor MacLean]

I forgot to mention that we're in the midst of acquiring a very exciting piece of technology. It's a small robot that goes between the row lines. We're purchasing it from a company called Korechi, based in Hamilton. The idea is to do prototyping of small robotics and eventually move toward that automation piece.

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

Fantastic. You mentioned the work you're doing with a company called SoilOptix and really scaling down the time it takes for them to do an analysis. In my region, we have a company called EIO Diagnostics, a small start-up. They have developed technology that leads to early detection of mastitis. They can scan a dairy herd in a phenomenal amount of time. This technology is meeting with great success in Africa and all around the world. There are a lot of countries really interested in this.

We're doing this study in the context of our exports. Can you talk a bit about this technology and its application worldwide, how we're leaders in this field, and any other bright spots as well?

[Gregor MacLean]

Yes. We see amazing work on the ground. As all of you on this committee know, farming is not so much a job; it's a lifestyle. For the most part, this is what all the great farmers we know are doing day to day. Typically, they're supported by a couple of amazing outside teams, such as agronomic consultants. In Ontario, we're most familiar with the staff of OMAFRA, the Ontario Ministry of Agriculture, Food and Rural Affairs. They are always doing landscape searches to try to figure out the best technology that's actually affordable as well.

A lot of it is focused on soil health. It has come back to soil organic matter. Sarah is doing a master's right now in soil health mapping. It's to better understand the resources we have here, because even if we reduce all barriers to trade, if our soil depletes, we're very stuck.