Evidence of meeting #17 for Agriculture and Agri-Food in the 43rd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was meetings.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

Markus Haerle  Chair, Grain Farmers of Ontario
Mark Brock  Co-chair, National Program Advisory Committee, Department of Agriculture and Agri-Food
Benoit Legault  Chief Executive Officer, Producteurs de grains du Québec
Todd Lewis  President, Agricultural Producers Association of Saskatchewan
Alan Ker  Ontario Agricultural College Research Chair in Agricultural Risk and Policy, Professor, Department of Food, Agricultural and Resource Economics and Managing, As an Individual
Corentin Bialais  Committee Researcher
Clerk of the Committee  Mr. Marc-Olivier Girard

2:25 p.m.

Conservative

Philip Lawrence Conservative Northumberland—Peterborough South, ON

Good afternoon, everybody. I'm glad to be here today.

Markus, I just wondered, on the BRM suite, if there are any sections that are working for you now.

2:25 p.m.

Chair, Grain Farmers of Ontario

Markus Haerle

Yes, AgriInvest is a program that works, but it is underfunded. If that program were increased, because it creates liquidity for a business right away, it's yearly and it's there for farmers to use....

Other than that, there's also the crop insurance program, which works significantly well for all farmers across the country, not just in Ontario. The structure of the program is well designed and adapted to the environment that we live in.

2:25 p.m.

Liberal

Neil Ellis Liberal Bay of Quinte, ON

Thank you.

Mr. Brock, you spoke about AgriInvest also, and you mentioned viable options. Could you elaborate on that?

2:25 p.m.

Co-chair, National Program Advisory Committee, Department of Agriculture and Agri-Food

Mark Brock

I think as we look forward, and if we really wanted to do some in-depth work within the impacted group and looked at different programs or created producer top-up of paid programs, some of that money from the producer side could come from AgriInvest.

I would be quite willing to take AgriInvest money that I have and buy private insurance with it to mitigate risk, but some of those options aren't available due to different regulations within provinces or territories. I think there needs to be some work there to make sure there aren't government barriers through regulatory processes that inhibit options, where producers could maybe access private insurance tools and use AgriInvest money to do that.

2:25 p.m.

Liberal

Neil Ellis Liberal Bay of Quinte, ON

Markus, I think you mentioned a $130 to $170 per acre loss in corn. What is the profit on corn in a usual year? I know last year wasn't the greatest harvest, but do you know those numbers, or approximately?

2:25 p.m.

Chair, Grain Farmers of Ontario

Markus Haerle

You can usually flip that number right around, instead of a negative, you can turn it into positive. That's basically what it is.

2:25 p.m.

Liberal

Neil Ellis Liberal Bay of Quinte, ON

Has that been steady over the last, say, five years?

2:25 p.m.

Chair, Grain Farmers of Ontario

Markus Haerle

It's been fairly steady. I'd say a good mark...if you can get that from the marketplace. That's why I'm saying that the crop insurance program is based on those figures as well. It is actually quite reliable that we can bank on those numbers.

2:25 p.m.

Liberal

Neil Ellis Liberal Bay of Quinte, ON

I believe, in your literature you sent us or you might have said it in your testimony, that 86% of farm income is going to be reduced, and I think you said about 14% wouldn't be reduced. What is the 14%? Are they into different crops or are they doing something right? Are they larger farms? Are they smaller farms?

2:25 p.m.

Chair, Grain Farmers of Ontario

Markus Haerle

They're diversified into other commodities, often enough. When we did our survey of our farmer members, we surveyed them not just on the grains and oilseeds, but on the whole farm structure. Depending on the split of what they produce on their farm, that will determine what the impact will be.

2:25 p.m.

Liberal

Neil Ellis Liberal Bay of Quinte, ON

Would you like to discuss the Canada emergency business account? How many of your members have taken advantage of the loan? I believe it was up to $40,000 and $10,000 forgivable. I believe you have around 30,000 members. If they all took advantage, that would be another $300-million influx of cash into the farms.

2:25 p.m.

Chair, Grain Farmers of Ontario

Markus Haerle

By our outreach to farmer members, we can figure roughly about 50% have qualified for the program. In the early stage of the program, it was far less, because there was a lot of confusion, some hesitation and I think some parameters didn't quite fit the farms' structure. Even today, it still depends on what your farm's structure actually is, and that's where the problem is. We can't say that this program is actually going to help the ones who need the support urgently. It's not going to address everybody.

2:25 p.m.

Liberal

Neil Ellis Liberal Bay of Quinte, ON

Mr. Brock, have you taken advantage of that loan, or have any of your fellow farmers that you know of?

2:30 p.m.

Co-chair, National Program Advisory Committee, Department of Agriculture and Agri-Food

Mark Brock

Yes, I've taken advantage of the loan, and other friends of mine who farm have taken advantage of it if they fell within the parameters. With the changes that were introduced, more have been able to do that.

I think the concern that some of us have is that, other than the $10,000 that's forgivable, it helps with working capital, but it is incurring debt. We do have to be cognizant of the debt levels that we take on as producers, and this long issue of a slow rebound in prices. We have to be aware of our ability to service debt and be aware of our debt. It's a good tool, but we have to be educated in how we use it.

2:30 p.m.

Liberal

Neil Ellis Liberal Bay of Quinte, ON

We talked about ethanol capacity being down about 50%. Is that since the COVID pandemic, or has that been a gradual decline over years?

2:30 p.m.

Chair, Grain Farmers of Ontario

Markus Haerle

Would that question be for me?

2:30 p.m.

Liberal

Neil Ellis Liberal Bay of Quinte, ON

Yes it is, Markus. I'm looking at your screen.

2:30 p.m.

Chair, Grain Farmers of Ontario

Markus Haerle

Yes, that is actually since the pandemic. That was just a week or two after the pandemic hit and restrictions were put in place. We felt the impact on that reduction right off the bat, so it—

2:30 p.m.

Liberal

Neil Ellis Liberal Bay of Quinte, ON

Year to year, how has that—

Oh, I think I'm done.

Thank you, Chair.

2:30 p.m.

Liberal

The Chair Liberal Pat Finnigan

Thank you, Mr. Ellis.

Thank you, Mr. Haerle.

Mr. Perron, you may go ahead for six minutes.

2:30 p.m.

Bloc

Yves Perron Bloc Berthier—Maskinongé, QC

Thank you, Mr. Chair.

I'd like to thank the witnesses for being with us today and being so generous with their valuable time under the circumstances.

My first question is for Mr. Haerle.

Mr. Haerle, you mentioned the support that the U.S. was providing for its farmers, in contrast with the situation in Canada. You said that was making it harder for our grain farmers to compete.

Can you tell us what could happen if Canada doesn't provide better support to its agriculture sector before the crisis is over? What are the potential consequences?

2:30 p.m.

Chair, Grain Farmers of Ontario

Markus Haerle

The direct impact to a farmer in Canada is basically that we have to compete now against grain that is subsidized. Like I said to the committee just before, the problem is going to be that we are going into the world markets, so subsidized grain that's going onto the world market doesn't need to get as much from the marketplace because the farmer already has a cheque in his pocket.

They are not going to be looking for the top dollar at the end. It's going to be basically flooding the market. It's going to put pressure on production that's not subsidized, and we're going to be sitting on that grain because the processors—if you take the ethanol industry or even the feed companies, for example—are going to be getting grain from outside of the country, which is going to be cheaper. Their bottom lines are going to be better at the end. It all comes down to the bottom line of the business.

2:30 p.m.

Bloc

Yves Perron Bloc Berthier—Maskinongé, QC

Thank you very much.

The government needs to act immediately, then.

I'd like to hear your views on the calculator the government added to the AgriStability website to help farmers estimate the benefits they can expect to receive.

Do you find it helpful?

June 12th, 2020 / 2:30 p.m.

Chair, Grain Farmers of Ontario

Markus Haerle

It helps somewhat, but a smart and good businessman out in the countryside today already knows what's working and what's not.

The programs that we have available at the moment from government.... We know that our AgriStability program doesn't work. That is shown by the enrolment numbers that are in that program.

Also, the participation is not going to be increased just because of the COVID—

2:30 p.m.

Bloc

Yves Perron Bloc Berthier—Maskinongé, QC

Sorry, but I have to stop you there, Mr.—