Evidence of meeting #134 for Agriculture and Agri-Food in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was quality.
A recording is available from Parliament.
11:35 a.m.
Liberal
The Chair Liberal Pat Finnigan
Thank you, Mr. Jeworski. Unfortunately the time is up.
Merci, monsieur Berthold.
Mr. Longfield, go ahead for six minutes. Thank you.
11:35 a.m.
Liberal
Lloyd Longfield Liberal Guelph, ON
Thanks, Mr. Chair.
Thanks, everybody, for coming in this morning so we can try to get the agricultural look on this.
I know the trade committee is also studying this. The Minister of International Trade Diversification and the Minister of Agriculture will be working with the trade committee, because there are a lot of trade issues regarding this, but we're looking at the technical issues as well.
When we look at the phytosanitary quality, we've had thousands of certificates issued. Could Richardson and Viterra maybe tell us the results of the certificates for phytosanitary quality? How many times have we had to react to quality issues in the last couple of years?
11:40 a.m.
President and Chief Executive Officer, Richardson International Limited
I can't speak for the entire industry but speaking for Richardson, I can say it's rare. I think that's the appropriate description.
Our system is based on taking representative samples at loading, at the end of the loading spout as it goes onto the vessel. It's at the very last point of contact in Canada with the exportable commodity. That is then analyzed. It's third party. It's Canadian Grain Commission certificate final. Then, if a phytosanitary certificate is required, those samples are submitted directly to the CFIA for their expert analysis and a phytosanitary certificate is issued.
I can't remember a situation in canola, in China, or in what one would traditionally consider to be our most quality conscious destinations like Japan, where we've had a problem that wasn't detected at point of load. I can't even remember one we've had at point of load. This is a very unique, unusual circumstance.
11:40 a.m.
President and Chief Executive Officer, Viterra
I would just echo what Curt mentioned. We have never had a phytosanitary issue related to canola that I am aware of.
11:40 a.m.
President and Chief Executive Officer, Viterra
It is a very, very unusual circumstance in terms of what is being suggested by the Chinese.
11:40 a.m.
Liberal
Lloyd Longfield Liberal Guelph, ON
Right.
This committee visited the port of Vancouver when we were looking at an export study. We saw both terminals as well as other terminals—huge terminals—going in. We also did a study a year or so ago, when we had some weather issues relating to the rails—getting product to ships—and the loading system itself on wheat. Some technologies were going to be applied and some guards put in place.
Has there been any technical improvement within the port in terms of loading vessels? Is there any risk from an agricultural point of view in terms of the quality of product or getting it into vessels going to China?
11:40 a.m.
President and Chief Executive Officer, Richardson International Limited
There have been none that I can think of. As I say, China is one destination amongst many, and this has not been a problem certainly in our experience.
In our understanding of the industry in general, we have not seen a problem with canola going to any other destination. We've not seen material problems in any other commodities, out of the port of Vancouver or out of Canada in particular, in any meaningful way or any sustained way that is being suggested here. You have an entire industry under warning and two companies under restriction.
11:40 a.m.
President and Chief Executive Officer, Viterra
I think one thing to add is that what is being suggested by the Chinese is in reference to what is inherently in the canola. There's been no reference to the loading process itself.
11:40 a.m.
President and Chief Executive Officer, Viterra
I've had the luxury of looking at systems all around the world. We have a world-class handling system in Canada that we should all be very proud of.
11:40 a.m.
Liberal
Lloyd Longfield Liberal Guelph, ON
Very good. It's good to get that testimony on the record, because we're also very proud as a committee.
Mr. Ruest, you came to us in September when we were looking at expanding our export opportunities, diversifying trade and trying to get us to the $75 billion. We talked about the technical issues. We talked about the MRLs and other issues in terms of regulatory approvals. I know that the industry continues to work on that.
In the fall economic statement, we had an announcement of $25 million going into non-tariff barriers. We had more trade commissioners coming online. How has the relationship been developed with the trade commissioners on this issue of technical...? Is there an update since September?
April 2nd, 2019 / 11:40 a.m.
Jean-Marc Ruest Senior Vice-President, Corporate Affairs and General Counsel, Richardson International Limited
I think what we've seen and what this issue has highlighted is the importance of focusing on the damage that can be created by non-tariff trade barriers. The uncertainty it presents puts a tremendous chill on the industry.
This is a business sector that is fraught with weather-related uncertainty. What we do need is certainty in the markets and in the environment in which we trade. We absolutely need to focus on those issues and make sure non-tariff trade barriers do not become widespread and aren't exerted in other jurisdictions.
11:40 a.m.
Liberal
Lloyd Longfield Liberal Guelph, ON
We've seen other products being targeted, such as pulses in India and wheat in Italy. As an association, what's the recourse? Are there appeal processes currently in place that we're following?
11:45 a.m.
President, Canola Council of Canada
I think that in the case of this kind of circumstance we have to look at all things. We have to look at all measures, including any possible chances we have to make sure that all importers are living up to their obligations under SPS rules and so on. Mr. Vossen referred to the protocols that usually take place in these kinds of circumstances. In order to resolve them, we need China to come to the table.
I would pick up on what you said about the trade commissioner service too. In the world that we had where we had high tariffs, they weren't good, but they were pretty simple; either you had a tariff or you didn't. You could market or you couldn't—
11:45 a.m.
President, Canola Council of Canada
With SPS, it's much more complicated. I think our trade commissioners have to be really well suited to that kind of market access issue.
11:45 a.m.
Liberal
The Chair Liberal Pat Finnigan
Thank you, Mr. Everson. You will probably have another chance later on.
Mr. MacGregor, you have six minutes.
11:45 a.m.
NDP
Alistair MacGregor NDP Cowichan—Malahat—Langford, BC
Thank you, Chair, and thank you, everyone, for coming today.
I think the whole country is well aware of just how serious this situation is, and I very much welcome your opening statements. It's a very complicated issue, and I think that it's really all beginning to dawn upon us here. I know that we want to pursue a science-based resolution to what I think is very much a political problem. When you look at China's track record with trade, you see that they may not have the best history of following the rules.
We know that with other countries that have stood up to them.... I'm thinking of South Korea. South Korea signed a free trade agreement with them in 2015, and when they decided to install an anti-missile battery, China responded by restricting tourism to South Korea. They also suddenly found that a whole bunch of South Korean department stores in China had fire code violations. As well, China was instrumental in a boycott against Korean-made cars.
They are willing, then, to throw their weight around, and canola is an obvious target because it's a Canadian success story and because of its sheer value.
Mr. Vossen, I'll start with you with regard to Richardson's proud history and relationship with China.
You and I discussed yesterday how in recent years China's track record has gotten better, but I'm thinking about the fact that our canola is destined for other markets in the same neighbourhood. Can you state for the record if any other countries that accept our canola seed imports have found any kind of problems?
11:45 a.m.
President and Chief Executive Officer, Richardson International Limited
No, not that I'm aware of.
11:45 a.m.
NDP
Alistair MacGregor NDP Cowichan—Malahat—Langford, BC
Okay. I know we have it on the record that no phytosanitary concerns have ever been found with our canola, but let's say there were concerns with some kind of agricultural product. If another country that's accepting our imports finds a problem, what's the standard procedure in terms of notifying you as the company?
11:45 a.m.
President and Chief Executive Officer, Richardson International Limited
Normally, if there were an issue detected by the regulatory agency at whatever destination or point of destination was involved, that would be communicated to the customer. The customer would certainly, along with that regulatory agency or in advance of that regulatory agency, contact us as the shipper and the seller. They, the buyer and the recipient of that product, would contact us. We would begin a process of analysis of the cargo, the issues at hand—
11:45 a.m.
NDP