Good morning, Mr. Chair and honourable members of this committee. Thank you for inviting me to speak today to share our organization's perspective on Canada's next agricultural framework.
My name is Tia Loftsgard. I am the executive director of the Canada Organic Trade Association. I am joined by my colleague Andrew Hammermeister, who is the director of the Organic Agriculture Centre of Canada and an assistant professor at Dalhousie University in the faculty of agriculture. Following my presentation, he will present on key policy needs for organic innovation in Canada.
I'll just describe who we are. The Canada Organic Trade Association, or COTA, as we are known, is a member-based organization that represents the entire organic value chain, including farmers, manufacturers, exporters, distributors, and provincial organizations.
Our mandate is to promote and protect the growth of organic trade to benefit farmers, the economy, the public, and the environment. COTA is the voice of organic trade. We work on market access via international trade missions. We have also been involved with the federal government on assessments of foreign organic standards. We also lead on industry and consumer awareness initiatives, as well as data collection for the organic value chain round table and on behalf of the Canadian organic sector.
Currently, organic is a booming business. It is an $80-billion industry worldwide, in U.S. dollars, and it's estimated to grow between 16% and 25% by 2020. In Canada, we are the fifth largest organic market, at $4.7 billion in sales. With more than 22 million Canadians buying organic food weekly, and with 5% of global food sales being organic, there are opportunities for Canada to take advantage of this emerging market at the domestic and international levels, adapt to this changing global environment, and stay ahead of its competitors.
Canada can stimulate clean and inclusive economic growth and take immediate action on climate change through signature investments in organic agriculture in Canada. The new agricultural policy framework could foster the growth of organic by providing tools to grow our supply chain across the country, supporting organic processors and developing programs for industry entrants.
There are two key components to ensuring that sustainable improvement of our production capabilities in Canada is fostered. First, the government should maintain its support for organic to develop new markets and trade opportunities for the sector. For example, the AgriMarketing program is valuable to our sector and our value-added processors. In the last three years, COTA has been using the AgriMarketing program funding to promote the Canadian organic brand abroad and to create export opportunities for more than 100 processors, traders, and growers across the country.
The next market development program should be as flexible as the present one in order to enable each agricultural sector to target specific markets and develop programs that are appropriate for its long-term international strategies.
To gain international market access, Canada has been working on equivalency agreements with other countries, our trade partners. These bilateral agreements are based on the mutual recognition of organic standards and reciprocity. We now have agreements with the U.S., the EU, Switzerland, Costa Rica, and Japan, and we are currently negotiating with Mexico and South Korea.
Organic trade is rooted in the industry's capacity to preserve the integrity of organic standards and to develop and maintain multilateral and bilateral equivalency agreements that benefit the entire organic sector.
Without timely maintenance of the Canadian standards and support for their enforcement and integrity, Canadian growers and processors are placed at a disadvantage in regard to their competitors. The next market development program should be flexible and support the tools developed by the industry to maintain the integrity of organic and facilitate its trade, notably the role that we play on the technical advisory committee for international trade equivalencies.
Second, as we showcased earlier, the demand for organic in Canada is growing, and in the next five years it's going to increase at a double-digit rate. Our biggest challenge, though, continues to be inadequate supply. We need more growers and more acres to be able to supply our manufacturers and processors.
In order to incentivize farmers to take advantage of the opportunities for higher incomes through organic premiums, mitigate risk by diversifying their production, and reduce their carbon and environmental footprint, policies need to be put in place to encourage more domestic production and sales.
We recommend that the next policy framework support the following:
A national organic certification cost share program should be in place. The organic industry development programs developed at the provincial level by Quebec and Prince Edward Island are models that could be adopted federally. These models include financial assistance for up to 50% of eligible expenses for transition, which is for pre-certification and post-certification costs to organic, up to a maximum of $40,000. Ideally we would have what our U.S. trade partner has, which is an organic certification cost share program that provides 75% reimbursement for certification costs up to a limit of $750 per certification scope.
Our sector needs the development of organic production insurance products that recognize premiums for organic and products that are transitioning to organic, and make these available in all provinces and territories. Currently in Canada we only have it offered in six provinces and does not cover all product categories.
We also need the development of incentive programs that encourage best management practices to support all farmers—not just organic farmers, but conventional and organic farmers—to meet the needs of soil and water quality, biodiversity, and climate change. We recommend that 30% of the budget for rural development programs be allocated to greening through agri-environmental measures and support for organic farming or projects with an environmentally friendly investment or innovation measure.
Finally, COTA strongly endorses the new addition that you put into the next policy framework, which is the value-added agriculture and agrifood processing priority area. We have more than 1,500 organic producers, processors, and handlers in the country. They play a pivotal role in supporting the local economy, and they should benefit as well from targeted support to increase their productivity and competitiveness.
I'll hand it over to Andy now.