Agriculture Committee on Oct. 20th, 2016

[Rosser Lloyd]

Certainly the recent high prices have not only resulted in margins increasing but also in the producers' equity increasing as well, so producers are in a better position today to manage some of the hits you're talking about than they were a number of years back. Our analysis would suggest a moderate increase in interest rates could be managed by the industry without taking significant hits.

[David Anderson, Conservative, Cypress Hills—Grasslands, SK]

What about 40% of the crop lying out in the field all winter?

[Rosser Lloyd]

Certainly that becomes an AgriInsurance and AgriStability issue. Yes, I'm worried about that too.

[David Anderson, Conservative, Cypress Hills—Grasslands, SK]

You're talking about broadening the APF in the sense that things like public trust and climate change will be bigger components than they've been in the past. In raising some certain expectations here, do you expect that the funding is going to be raised appropriately as well?

[Andrew Goldstein]

I think I'd go back to my previous answer: that remains to be seen.

[David Anderson, Conservative, Cypress Hills—Grasslands, SK]

Then I guess I'd ask this: do you think that these new policy areas are going to be integrated into the three main ones that you've had in the past? Are they going to fit into AgriInnovation, AgriCompetitiveness, and the AgriMarketing, or do you expect to see a couple of new pillars?

[Andrew Goldstein]

That's something we're working on right now, figuring out and looking at our existing programs and how those new priorities map into them. For example, when we look at the AgriInnovation program, there is a lot of support on the science and commercialization sides of things that do support food processing and value added. On the market development side, our AgriMarketing program supports food processing. We start to look at those to see whether we can continue on that way or whether we need to change the structure a bit to address the priorities more directly.

[David Anderson, Conservative, Cypress Hills—Grasslands, SK]

I would encourage you to focus on those priority market development things that farmers and producers can actually use to create success in their industry.

[The Chair, Liberal, Pat Finnigan]

Thank you, Mr. Anderson.

Ms. Brosseau, you have the floor for three minutes.

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

Oh, God. It's going to go fast.

I think it's really important that we make sure that this new framework works well for farmers because these are tools, right? We want to make sure that the farmers and agriculture have the right tools to make sure that we remain competitive and are able to innovate.

I just want to understand, because there have been so many problems. I know that fewer and fewer farmers have been using AgriStability. I know that smaller farmers don't really use it because it costs a lot of money to have an accountant basically make sure that everything is up to date, and it's a lot of paperwork. Some of that is not justified by the program's risk reduction potential. Can you elaborate on why AgriStability has had a decrease in participation?

Mr. Trudeau's economic growth advisor, Mr. Barton, published an article recently. I think it was last week. He wrote that the government should invest more in the agriculture sector to stimulate the economy. I think everyone agrees on the importance of doing so, but you know very well the last budget did not include anything for the agriculture and agri-food industry. There were no investments.

Can you shed light on the importance of investing in the agriculture and agri-food industry to stimulate Canada's economy?

[Andrew Goldstein]

I will take that second part of your question.

We're generally very pleased to hear of someone of Dominic Barton's stature talking about the importance of agriculture. I think it's great that someone from that side of things can see the tremendous potential of agriculture contributing to the Canadian economy. That's something that is driving us in terms of the kinds of investments that we would like to help to support the sector move forward and take advantage of those opportunities from innovation.

I'll leave my colleague to answer the first part of your question.

[Rosser Lloyd]

I'll address the question of why participation is declining.

We believe there are a number of reasons. We have experienced some record net incomes in agriculture for the last little while, so the perceived need for the program has certainly diminished. Producers are recognizing that the prices are solid. They're seeing good crops in the bin. They're just saying, “I'm not going to trigger a payment under this program. I'm not going to participate.”

On top of that, we diminished the triggers on the program. Again, they're saying things are good and there's a lower trigger, so they'll have to take a more substantial hit before they trigger the program. They're concluding that in this environment, it's not worth participating.

You also raised the burden side of things. We do see that. Our programs currently have about one-third of the producers out there, but about 60% of the value of production. It's those larger producers that are continuing to participate in the program. We believe that that burden on those producers is the reason the smaller producers aren't participating.

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

Maybe we—

[The Chair, Liberal, Pat Finnigan]

Thank you, Madam Brosseau.

Bob, do you want to go for three minutes?

[Bob Bratina, Liberal, Hamilton East—Stoney Creek, ON]

Thanks very much for this opportunity.

Markets and trade are under the six highlighted areas, but we haven't talked much about logistics. Is that something for a future meeting? Can I ask you if there is integration with transport and infrastructure to move agricultural goods in their own way?

In my city of Hamilton, we have over $2 billion's worth. It must be more than that now; that was when I left the municipality. We do canola. We do Maple Leaf's proteins. We've got the biggest bakery. We just built a flour mill. The success relates to the position of Hamilton as a port. We even ship livestock in cargo jets.

However, I've talked to members from different parts of Canada, and in other areas I know that the transport systems aren't there. An example is landing strips in the far north. We saw what happened in northern Ontario when the highway had a problem. What can you say about logistics in terms of the agricultural business?

[Andrew Goldstein]

I think you're correct in saying that transportation infrastructure is critical to the success of the sector from all aspects, and it's a key element of our markets and trade.

The challenge is that it really falls outside of the scope of our policy framework and the ability of Agriculture Canada and the provincial ministries of agriculture to address that issue. We do work with our colleagues from Transport Canada and others to help make sure that they understand the challenges that infrastructure has for the agriculture sector.

[Bob Bratina, Liberal, Hamilton East—Stoney Creek, ON]

With regard to developing new products, what can you tell me about organics? Is that a good growth area for Canadian agriculture?

[Andrew Goldstein]

There are a number of producers of organics. It seems the numbers are starting off quite small in terms of the overall percentage. I don't have the exact numbers, but there certainly seems to be a lot of growth opportunity there. Certainly, from an Agriculture Canada perspective, we encourage producers to choose whatever model and practice of production they feel is going to serve their interest.

[Bob Bratina, Liberal, Hamilton East—Stoney Creek, ON]

Thanks, Chair.

[The Chair, Liberal, Pat Finnigan]

We've exhausted the list. There's still a bit of time if there are other questions. If not, we can certainly terminate this part of the meeting and go into our business portion of the morning.

Are there any comments?

Mr. Longfield, what do you think?

[Lloyd Longfield, Liberal, Guelph, ON]

Would there be time for more questions?

[The Chair, Liberal, Pat Finnigan]

We could have a short round of, say, three minutes each. The other meeting is at 10:15, but it will be probably be 10:10 before we clear the room.

Is it the wish of the committee to go for a short round, or would you want to terminate it at this stage?

[Lloyd Longfield, Liberal, Guelph, ON]

I'd love to see a short round. It's great having these folks here.

[The Chair, Liberal, Pat Finnigan]

Is there anybody on this side who would like to go for a three-minute round?

[David Anderson, Conservative, Cypress Hills—Grasslands, SK]

Why don't we start over there?