Evidence of meeting #46 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 issues.
A recording is available from Parliament.
12:35 p.m.
Conservative
Jacques Gourde Conservative Lévis—Lotbinière, QC
Do we have the required slaughter capacity in Canada to meet this challenge over the next 10 years?
12:35 p.m.
Executive Vice-President, Canadian Cattlemen's Association
We have the capacity. Actually, this week there's a new plant opening in Alberta. It was Rancher’s Beef and it's now Harmony Beef. They will focus on Europe.
We're single-shifting in some of our plants because of labour issues. In some it's because of the supply of cattle available. They're operating at about 60% capacity right now, and ideally you want to be operating at 90% plus. We have capacity ready to go, but they've told us that they will need to bring in, and are looking for, some investments on the further processing in their operation.
Each market will look for things. We want to command a premium in every market. We're not there to compete on the commodity market. We believe that our position, as one of the trusted suppliers in the world, is to go after that loyal customer who will want to be featuring Canadian beef regularly.
12:35 p.m.
Conservative
Jacques Gourde Conservative Lévis—Lotbinière, QC
My question is about our exports and about the interim agreement negotiated with the European Union.
France will hold its election this spring, and some parties would like to withdraw from the agreement because Canadian beef production is too competitive relative to France's beef production.
Is that a source of concern for you?
12:35 p.m.
Executive Vice-President, Canadian Cattlemen's Association
The way it has been described is that there's always an election somewhere, every year with these agreements. That's something we're looking at, and we're going to focus quite a bit of effort on advocacy in Europe. France is typically one of the more difficult countries to deal with. We're going to be travelling over there and meeting with both industry and regulators, trying to build a tighter relationship with them. Once CETA goes into place, there isn't a specific timetable as to when every country has to ratify it. It is structured...and they recognize there are going to be challenges country by country.
We fully anticipate that other European countries are going to bring some effort to persuading France that the total package is very important. I also think right now for Europe, for their own credibility after Brexit, that CETA is a very important deal. They're able to demonstrate that they can function as a European unit and that they can still make an agreement that is very substantial.
12:40 p.m.
Liberal
The Chair Liberal Pat Finnigan
Thank you, Mr. Laycraft.
Thank you, Mr. Gourde.
Mr. Peschisolido, go ahead for six minutes.
12:40 p.m.
Liberal
Joe Peschisolido Liberal Steveston—Richmond East, BC
Mr. Chair, thank you.
I too would like to thank you guys for coming out. It was very informative.
I would like to begin with a general question, and then get into specifics.
Last Tuesday we had government officials here, and I got the sense that whether you call it a non-tariff barrier or a non-tariff measure, there's a certain amount of resignation that there are always going to be these issues, because it's not just about science-based or technical negotiations; it's about culture. It's how people live.
That being said, and just following up on Mr. Gourde's question about what's happening in France, the EU, and perhaps all over the world, generally speaking, we heard from the government officials about things they're looking at in order to deal with a reality that perhaps exists. What kinds of things can we do...? Let's assume for a second that you're always going to have some type of non-tariff measure or non-tariff barrier. What can you guys do to allow us to help you to make sure there are fewer and fewer of these things?
12:40 p.m.
Executive Director, Canada Organic Trade Association
I think I'll go back to the equivalency arrangements we have with 90% of our trading partners on the organic marketplace. There has been a positive move. We've formed a technical advisory committee that will consist of industry informing the CFIA with regard to equivalency agreements before they are finalized so that you can get formal industry feedback.
In the past we've kind of moved ahead with things and then have found out that there have been ramifications so that where we thought we had improved a deal, we had actually created a bigger problem. Now we have to go back to the drawing table, and all of that takes time, money, and energy away from all of our efforts. I think that's a positive move, as long as we can work in consistency and understanding timelines, but it's a positive move.
As well, our sector consists of 5,000 certified operators but we have three national associations. COTA is the only one that works on equivalency agreements. It makes it quite challenging when we're a small organization but we are covering multiple sectors, multiple markets, etc. The more that we—
12:40 p.m.
Liberal
Joe Peschisolido Liberal Steveston—Richmond East, BC
Ms. Loftsgard, can I interrupt?
Tell me a little bit about this organic office being shut down.
12:40 p.m.
Executive Director, Canada Organic Trade Association
Sure.
We had a presentation at the organic value chain round table by CFIA saying that essentially the Canadian organic office, which used to have about four employees, would now be integrated into two separate structures.
12:40 p.m.
Liberal
12:40 p.m.
Executive Director, Canada Organic Trade Association
It continues to be CFIA, but essentially it is integrated into two separate departments. There's no longer something called the Canadian organic office. The lead auditor is still there, but she's also covering the Safe Food for Canadians Act, etc. She's not dedicated specifically to organic.
12:40 p.m.
Liberal
Joe Peschisolido Liberal Steveston—Richmond East, BC
Okay.
Talk a little bit more about organic fraud, because perhaps there is no other sector.... If you guys want to grow, and I assume you do, public trust is even that much more important, because it's something that is completely different. Organic just means natural. When I go shopping with my partner, we see stuff and it's organic all over the place, but it's not certified.
Can you elaborate a little bit on how we, as a government, can be helpful to you on this organic fraud part? This is something that I think is key.
12:40 p.m.
Executive Director, Canada Organic Trade Association
I'm going to let Wally, as a certifier, speak to that in particular.
Our comments so far on the safe food for Canadians regulations are that the government, in past regulations, said no to allowing the term “certified organic”, whereas all of our trading partners allow the term “certified organic”. One of our big asks, now that we're open for discussion, is to allow the term “certified organic” in Canada. It's a very easy ask.
If we want to move on to the fraud question, as a certifier, I think Wally has a lot to contribute on that topic.
12:40 p.m.
General Manager, Pro-Cert Organic
Basically, what can happen in Canada now under the OPR and under the proposed safe food for Canadians regulations is that if, in fact, your certification is cancelled by a certifying body, and that does happen, you can immediately move to another certifier and reapply within days, or you can do it during the process of cancellation. You can reapply, and within days and weeks, you will be back in business. Whether or not the non-compliances have been affected is questionable. That's what's happening now.
The safe food for Canadians regulations don't change any of that. There's no proposed enhancement of enforcement in this new regulation. Again, our trading partner to the south, which takes 60% or 80% of our exports in organic from Canada, they have—
12:45 p.m.
Liberal
Joe Peschisolido Liberal Steveston—Richmond East, BC
That's total. For every organic, the States take 60% to 80%.
12:45 p.m.
General Manager, Pro-Cert Organic
Yes. We export a lot of organic food. They have a very robust penalty and fine system, plus they have a five-year hiatus from the time you lose your ticket to getting a new one. If you're out of business for five years in organic industry, that means you're out of the organic industry. In Canada, you're back in. The regulations, both old and proposed, don't really deal with this critical issue.
12:45 p.m.
Liberal
Joe Peschisolido Liberal Steveston—Richmond East, BC
Professor Hamm, thank you. I'd like to move over to Mr. Laycraft. I apologize, our six minutes moves very quickly.
You mentioned the TPP, and that's important because in my neck of the woods Japan, China, and Korea are important. Assuming that the TPP will not go ahead as structured, what can we do bilaterally to help you guys sell as much beef as you can into Japan, and hopefully China and Korea?
12:45 p.m.
Executive Vice-President, Canadian Cattlemen's Association
Certainly with Japan, the tariff was the big advantage. We were going to drop from 38.5% down to 9%. Right now, Australia has a bilateral and their tariff rate is about 27%. We're paying 38.5% on ours, so there's a big disadvantage there. We have a fairly active partnership negotiation. It has more or less been suspended here for a while as TPP was being negotiated, but we'd like that to move forward if we're not able to achieve that. One of the things you get in a multilateral agreement like the TPP is the ability to address some of the non-tariff technical issues.
12:45 p.m.
Liberal
The Chair Liberal Pat Finnigan
I'm afraid I'm going to have to cut it off there, Mr. Peschisolido and Mr. Laycraft.
Madam Kwan, you have six minutes.
12:45 p.m.
NDP
Jenny Kwan NDP Vancouver East, BC
Thank you very much, Mr. Chair.
Thank you to the delegation for your presentations. There's a lot of ground to cover in six minutes, so let me give it a shot.
On the organic side of things, we heard from a previous delegation that, in fact, there is the market access secretariat that's set up specifically for them, and there's a committee as well. In terms of really having a voice, being heard, and having a dialogue, what would your suggestions be in terms of action that the government can take to ensure that this dialogue takes place and the issues are back up on the table?
12:45 p.m.
Executive Director, Canada Organic Trade Association
We do a lot of correspondence with the market access secretariat as well as trade commissioners around the world, particularly to resolve issues as we see them coming or in advance, particularly when it comes to bilateral meetings. We were just at the Canada-Mexico meeting because they are looking at forming their own organic standards and they want to get the perspectives of their trading partners in advance. I think that being invited and continuing to have the dialogue, especially with new countries that we're looking at empowering our trading relationships with from the forefront, is critical.
12:45 p.m.
NDP
Jenny Kwan NDP Vancouver East, BC
Would you suggest or recommend any specific action that needs to be taken, or should the current system then just continue and you're satisfied with that?
12:45 p.m.
Executive Director, Canada Organic Trade Association
I think I'm learning how we can work together, so it's hard to come up with some concrete suggestions until we see how other sectors outside of organic have been able to work with the market access secretariat.
One of the areas where we certainly see a fall down between our government departments is that the market access secretariat can't even access information CFIA has with regard to who are certified operators. I think having dialogues between the two departments and Global Affairs Canada will help tremendously. The national organic program is set up that way in the United States, but not here.
12:45 p.m.
NDP
Jenny Kwan NDP Vancouver East, BC
You mentioned that you had an office. It's now been divided into two areas, and the name has disappeared. When did that happen?
12:45 p.m.
General Manager, Pro-Cert Organic
It happened so suddenly that no one noticed it until recently. We got a document in Pro-Cert that would give us accreditation to certify in Korea, for instance, to the COR. The bottom was signed by no one with an organic title. Then the rumours got out that this thing had just been suddenly done without any kind of consultation. I would say it's in the last six months, to answer your question—just quietly.