Agriculture Committee on Oct. 27th, 2016

[Lloyd Longfield, Liberal, Guelph, ON]

I'm going to share my time with Mr. Peschisolido.

[The Chair, Liberal, Pat Finnigan]

You have a minute and six seconds. There you go.

[Joe Peschisolido, Liberal, Steveston—Richmond East, BC]

Mr. Chair, I'd also like to thank the witnesses for their presentations. They were phenomenal.

I'd like to quickly focus on two aspects of the Calgary issues statement: markets and trade, and value-added agriculture.

Mr. Vander Ploeg, I was intrigued by two comments you made. Number one, you said that Canada is a superpower in food, and next, you talked about shifting over from high-volume, low-cost products to premium products. How can the framework help your folks do that?

On the second point, Ms. Miller, I'd like to hear how we can go from just providing seeds to having more of the oils and moving into higher-value processing.

[The Chair, Liberal, Pat Finnigan]

Quickly, please.

[Joe Peschisolido, Liberal, Steveston—Richmond East, BC]

I think you have about six seconds each.

[Voices]

Oh, oh!

[Casey Vander Ploeg]

I think that continued funding for market access development and industry's role there are critical. In addition to that, it's really about getting a handle on growing the labour pool. We have trade deals in place now. We're looking at markets opening up. The big question is, do we have the workers in order to do it? From the processing side, we would say no, we're simply able to do what we can do now, never mind increasing it.

[The Chair, Liberal, Pat Finnigan]

Thank you, Mr. Vander Ploeg.

I'll allow you 10 seconds to quickly address that.

[Patti Miller]

The ag policy framework has really helped us uncover the health benefits and the feeding benefits of canola oil. We have used that to differentiate ourselves in the international market to try to get a premium back into the industry. There has been a huge investment in the industry because of that increased knowledge in terms of what canola can do.

[The Chair, Liberal, Pat Finnigan]

Thank you, Ms. Miller.

We'll end it with five minutes with Mr. Anderson, and then we'll move into our discussion.

Go ahead, Mr. Anderson.

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

Thank you, Mr. Chair.

We've talked a bit about climate change this morning. The government is forcing a carbon tax regime on the country. Those of us who have followed this for a while know that these don't work.

Carbon exchanges have been a complete failure where they've been put in place, and carbon taxes don't work. They generate a lot of revenue for government, but they don't work unless the tax is so high that it punishes normal behaviour, such that people have to change their regular practices. Many people have used B.C. as an example of where a carbon tax has worked, and emissions are actually going up there.

Here's my question to the industry. If there's a tax that's high enough that you have to change regular practices, which is the point of the tax, how do you remain competitive if our competitors, primarily those south of the border, do not have that same tax to deal with? That's for canola, but particularly for the feeders.

[The Chair, Liberal, Pat Finnigan]

Again, Mr. Anderson, this is—

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

This is relevant to the APF, because are we going to have to put massive amounts of money into the APF to counteract the effects of attacks on competitiveness and market access for our industries?

How does having a large carbon tax affect your capacity to remain competitive?

[Brett Halstead]

As a producer, I'm always concerned about anything that will affect or erode my competitiveness. Our competitive position is more than just going up against the U.S. As Patti mentioned, canola is 5% of the global trade in oilseeds. It's very important that we remain competitive. Soybeans are a huge crop out there, as well as palm oil, so our competitiveness is critical.

Farmers have continually adopted and adapted new technologies. We produce more on the same or fewer acres now than we did 20 years ago. We burn less diesel fuel.

We will look at adapting in the best way possible, but we're definitely concerned about our competitive position.

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

Mr. Vander Ploeg, do you have any issue with this?

[Casey Vander Ploeg]

I would echo that comment. I am very seriously concerned about our competitive position.

I have a very quick example. Over the last 10 years, the average annual profitability in our sector is about $18 a head. That's what cattle feeders make. We're seeing the piling on now, because we have a carbon tax coming into play in Alberta, we have new regulatory changes such as Bill 6, for example, we also talk federally of tax. These things are starting to add up. It doesn't take long for eighteen dollars' worth of profitability to evaporate.

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

We've had one feedlot close down. One of the issues he mentioned was the fact that there was a carbon tax being applied.

My concern is that there is no appetite for considering past improvements. You've talked about them this morning in terms of the changes that farmers have made since the 1980s and into the 1990s, but in the discussions we've had previously, there hasn't been an appetite to consider those improvements. We'll leave it at that for now.

I wanted to ask Mr. Halstead about this. We're down below 30% participation in AgriStability. Doesn't that basically leave the ag community without a safety net? I use AgriInsurance and AgriInvest, as well as you do, from what you've said, but without AgriStability.... Is there an effective safety net for farmers when the participation rate is below 30%?

[Brett Halstead]

Not in a complete market collapse, no.

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

Okay. If we face, for example, a 2% or 3% hike in interest rates, potentially, or a crop that's in the field all winter, is that going to have an impact on this?

[Brett Halstead]

It can, if you have a significant amount of crop out.

AgriInsurance works well if you have your whole crop out over the winter, but if 80% of your crop was combined, let's say, and you had 20% in the field, that 20% might be your profit. That might be your drop in the market, and that's where an AgriStability would come in, because you might not actually trigger your AgriInsurance at that point.

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

I'm almost out of time here, Ms. Miller, but there is support for things like organic development. It's a growing part of the industry or whatever. We've been doing some studies on GMOs. Do you think support, promotion, and public education about the benefits of GMOs should also be a component of the APF? Your industry is actively using them and feeding people around the world with them.

[Patti Miller]

Yes. Certainly, consumer attitudes toward GM and biotechnology are a challenge. You see the public swayed by a really nice meme on the Internet and ignoring years of research and studies. I think we need to do a lot more in terms of getting the message out, not only about the safety of the products but also about the environmental impact they have had and the improvement in sustainability.

We recently released a study on biotechnology ourselves, and that speaks to the positive impact it has had on our industry.

[The Chair, Liberal, Pat Finnigan]

Thank you, Ms. Miller.

Thank you so much for participating, Ms. Scovil, Mr. Halstead, Ms. Miller, and Mr. Vander Ploeg, and also for both the very interesting input and the very interesting conversation.

We'll break for a minute or two and go to our other business.

[Proceedings continue in camera]