Agriculture Committee on March 12th, 2020

[The Chair, Liberal, Pat Finnigan]

Good afternoon, everyone. I'd like to welcome you to this meeting of the Standing Committee on Agriculture and Agri-Food.

This afternoon, we have the honour of welcoming the minister, Marie-Claude Bibeau.

We are very happy to have you with us this afternoon to talk about the supplementary estimates.

You may go ahead with your opening remarks.

[Marie-Claude Bibeau, Liberal, Minister of Agriculture and Agri-Food]

Thank you, Mr. Chair.

I am delighted to be with you again. In Canada, we are all driven by this same passion and commitment to agriculture.

First, I would like to thank you for your dedication. You immediately got to work to discuss business risk management programs, an issue that is very important to our producers, and one that I pay particular attention to.

Our government is working hard to support producers and help grow the Canadian agriculture sector, and the supplementary estimates we are discussing today are proof of that. Agriculture and Agri-Food Canada supplementary estimates total $435 million, for a total annual budget of close to $3 billion. Of that amount, we are investing $345 million in the first installment of the full and fair compensation that we committed to our dairy producers for the impact from our trade agreements with the European Union and the trans-Pacific zone.

The estimate also includes $21.4 million to meet increased demands for the advance payments program. These funds are related to the improvements we made last year to the APP, including increasing the interest-free cash advances available to canola producers from $100,000 to $500,000, and raising the total advances available for canola and all other commodities to $1 million, up from $400,000.

Producers have long been requesting these changes that will give them more access to liquid assets. We are proud to have been able to increase this support.

In addition, $55.3 million is allocated to the Canadian agricultural partnership to give the provinces more flexibility to implement regional programs.

Mr. Chair, I care deeply about our Canadian farmers. They have been incredibly resilient in the face of stressful challenges this past year. Poor seeding and harvesting conditions in many parts of the country, market access challenges, including canola in China, and then a rail strike followed by the blockades have resulted in difficulties moving products to market, accessing input supplies, and have affected profitability.

We worked hard to reach lasting and peaceful solutions, and it is encouraging to see commodities moving again.

We are closely monitoring the impacts of the coronavirus on the agriculture sector. This is a global challenge, and with the help of the recently announced response fund, we are well positioned to respond. Trade is a key priority for our farmers, and we continue to work hard to help capture the amazing opportunities that lie ahead.

Our efforts are paying off. Last year, Canada's agriculture, food and seafood exports reached over $67 billion, continuing growth towards reaching our goal of $75 billion in exports by 2025. The value of Canadian grain exports has increased by 25% since 2016. Our cattle and beef exports were up by over 20%, and in Japan, they rose by almost 70%, as producers begin to reap the benefits of the CPTPP.

While we continue to diversify our trade, we are working to strengthen our relationship with our largest trading partner to the south. Last month, Secretary Perdue and I discussed the importance of the new NAFTA and our commitment to ratifying it as soon as possible. Hundreds of thousands of jobs rely on this trade relationship. I also reminded the secretary of the importance and value of Canada's supply management system.

Obviously, government support to our agricultural producers isn't limited to trade support. With regard to supply-managed sectors, we are making progress on the compensation promised. Already, almost $345 million has been disbursed in direct payments to dairy producers, in addition to investment programs on farms and in dairy processing, for a total of $423 million in this fiscal year. We are about to finalize compensation for the other producers and processors, according to their preferences. We will do the same regarding CUSMA.

We are also continuing to improve our federal-provincial-territorial risk management programs. It's my very first objective among all of those set out in my mandate letter by the Prime Minister.

I would like to take this opportunity to thank the committee for undertaking a study on business risk management programs, and I hope your work will be constructive. Your recommendations will be given careful consideration, and I hope your work will help to improve these programs for our agricultural producers.

With my colleagues from the provinces and territories, we have made some immediate improvements to AgriStability. Starting this year, private insurance payments won't count against farmers' AgriStability payments.

As well, we have asked officials to look at each and every program and tell us whether they are meeting their objectives and, if not, to identify gaps. Farmers face new business risks, and trade and climate have more impact on today's farms.

I also look forward to the committee's review of BRM programs. Together, we will help to ensure they deliver for our farmers.

Producers tell me that environmental protection is in their DNA. They aren't farming their land just for today, but also for future generations. However, producers must have access to new green technologies, to better products and better practices. That's where we want to help them.

We continue to make investments in innovation and environmental sustainability. For example, last week, on Prince Edward Island, we partnered with the province to announce a joint investment under the agricultural clean technology program. The funding will help organic greenhouse producers transition to 100% clean energy.

Sustainability is not only about the environment. For farmers, sustainability is also economic and social, and that includes mental health.

When I talk about diversification, I think in terms of markets but also of a wider range of products, value added.

Investing in innovation is another way to increase the demand and to get more money for the products we have.

Within the Food Policy for Canada, we are also working to create trust and pride in Canadian agriculture and our producers through a new $25-million “buy Canadian” initiative.

Lastly, we must work together to prepare the next generation of Canadian producers and processors. I'm working with the Minister of Finance to facilitate the intergenerational transfer of farm operations. A family farm is a life's work, so we must help the next generation to take up the torch.

We also need to have a greater diversity of views around the table, as we all see the challenges and opportunities differently. To encourage our young people to take leadership roles in the sector, I am pleased to launch the first Canadian Agricultural Youth Council.

I want to hear directly from youth across the country, including indigenous communities, about their vision for agriculture. We must give them what they need to succeed. The future belongs to them.

Likewise, we need more women in leadership positions in agriculture. It's encouraging to see more women stepping forward. Their perspective is vital to help shape a sustainable future for our industry.

I understand the pressures faced by producers, along with higher levels of stress. Canadian farmers work hard to feed us. I'm inspired by their resilience, their ability to innovate and their respect for the environment and animal welfare. These women and men deserve our greatest respect.

I know that everyone around this table is committed to doing everything in our power to ensure they have a future full of promise for them and for the coming generations.

I'd like to thank the committee for its dedication to agriculture and for its co-operation.

I would be pleased to discuss this with you. Thank you.

[The Chair, Liberal, Pat Finnigan]

Thank you, Madam Minister.

I would like to acknowledge the presence of Chris Forbes, deputy minister of the Department of Agriculture and Agri-Food.

Also with us is Madam Christine Walker, assistant deputy minister, corporate management branch.

Welcome.

We will start our round of questioning with Mr. John Barlow for up to six minutes and then go to a four-minute round.

[John Barlow, Conservative, Foothills, AB]

Thank you very much, Mr. Chair.

Thanks, Minister, Chris and Christine, for being here. I appreciate your taking the time.

Minister, I'm glad you spoke about mental health and anxiety that is going on within the agriculture sector right now. A big part of that is some of the policy that has been put in place. That is also impacting the health of our rural communities and our rural economy.

I really want to stress this. You need to understand that especially in western Canada, when the energy sector is successful, agriculture is successful, because those rural communities are thriving.

I have to ask you. You didn't have the opportunity to answer today. Why were you lobbying against the Teck Frontier mine in rural Alberta?

[Francis Drouin, Liberal, Glengarry—Prescott—Russell, ON]

Mr. Chair, on a point of order, the member knows very well that the minister cannot answer. Rumours about cabinet discussions—

[John Barlow, Conservative, Foothills, AB]

I'm just giving her an opportunity to answer the question. She didn't have to answer.

[Francis Drouin, Liberal, Glengarry—Prescott—Russell, ON]

—cannot be answered.

[John Barlow, Conservative, Foothills, AB]

She can answer that, Mr. Drouin.

[Francis Drouin, Liberal, Glengarry—Prescott—Russell, ON]

No. You know very well that cabinet discussions are not discussed and could be susceptible to criminal investigation, so I am just warning the member that if that's the line of questioning that he will go on—

[John Barlow, Conservative, Foothills, AB]

That is one question. I'm just asking so she has a chance to answer today.

[Francis Drouin, Liberal, Glengarry—Prescott—Russell, ON]

—it is not acceptable to this committee.

[The Chair, Liberal, Pat Finnigan]

Thank you.

Although on the supplementary estimates I think it's quite wide, we've invited the minister to talk about things that matter with the supplementary estimates. I would like the members to keep that as their focus and not stray to other....

[John Barlow, Conservative, Foothills, AB]

I appreciate that. I was just giving the minister an opportunity to answer that. It's fine if she doesn't want to.

[The Chair, Liberal, Pat Finnigan]

Sure.

[John Barlow, Conservative, Foothills, AB]

Minister, you've brought up the issue over the last few months that you're looking for more data and more evidence to make a decision on the carbon tax and on maybe expanding the exemptions, which could have an impact on the budget, for farm fuels to include propane and natural gas. You commented on several occasions that you were looking for more data on what that would be. We have certainly had that data now for many of our stakeholder groups. APAS has shown that the carbon tax would be a loss of 12% of their revenue. Keystone Agricultural Producers of Manitoba said it's already paid close to $2 million in carbon tax just for grain drying. Hog farmers in Manitoba are saying it will cost between $2 million and $2.6 million a year.

What more do you need to make the decision that this is having a detrimental impact on agriculture or for you to make a decision on whether or not you'll include natural gas and propane in the farm fuel exemptions?

[Marie-Claude Bibeau, Liberal, Compton—Stanstead, QC]

Last December my provincial counterparts and representatives of the industry were asking me to convince my colleagues, I would say, to have an exemption for the price on pollution on the energy needed to dry grains. At that time, I had some data from the department, but I wanted to get more from the industry and from my provincial colleagues to see if I had a business case to make. I told them that if I had a business case demonstrating that the price on pollution on grain drying had a significant impact on farmers, I would make the case to my colleagues and see what we could do.

I received the information. If you look only at the price on pollution on grain drying, it's less than 1% of the operations of the average farm. The numbers I received go much wider than that. They presented me with more data around the impact of the price on pollution of direct and even indirect costs to farmers applied to their profits. Obviously, when we look at the data this way, it becomes significant.

[John Barlow, Conservative, Foothills, AB]

I'm sorry, Minister, but I only have a few minutes, and I kind of got your answer—that you're not ready to make that decision yet, despite the numbers we have seen. I think for you to say that it impacts their profits, when there are no profits there if you're losing 12% of your revenue just on the carbon tax, or to say that it's 1%, when from all the data we have seen on that.... It's not the case.

When you're including that, we've also heard from CN and CP that the carbon tax they are passing on to producers—in 2022, $50 a tonne—is $28 million. That's just from transport. I don't think your data is including that if you're just talking about grain drying. We're trying to heat barns. These are costs being passed on to producers that they cannot pass on anywhere else.

So I want to question your data in terms of 1% of revenue. I don't think any producer in Canada will say that it's only 1% of their revenue, not when every number we have is besides that.

I want to leave some time for my colleague.

[The Chair, Liberal, Pat Finnigan]

You have 25 seconds left on your four minutes.

[John Barlow, Conservative, Foothills, AB]

Did you stop the clock when the point of order was going on?

[The Chair, Liberal, Pat Finnigan]

Yes, I did.

[John Barlow, Conservative, Foothills, AB]

So I still have two minutes left.

[The Chair, Liberal, Pat Finnigan]

You have two minutes and 15 seconds.

[John Barlow, Conservative, Foothills, AB]

Okay.

[The Chair, Liberal, Pat Finnigan]

Go ahead, Ms. Rood.

[Lianne Rood, Conservative, Lambton—Kent—Middlesex, ON]

Thank you, Mr. Chair.

Thank you for being here today, Minister, and thank you to Chris and Christine as well.

Minister, we've seen reports going on right now of items and bare essentials coming off of grocery store shelves. With COVID-19 being so prevalent right now, people are panicking about certain things.

Do you have a plan in place to ensure that our grocery store shelves can be kept full of fresh fruits and vegetables? Grocery stores are an essential service. We have places like the Ontario Food Terminal in Toronto, which provides about 95% of the fresh produce to the independent supermarkets in Ontario as well as the food distribution companies around the province. A place like that employs over 2,000 people on a daily basis. Private stores also have distribution centres that have many employees in the same space at the same time. We've seen events being cancelled in different places with many people there.

Does the government have a plan to make sure that we don't create a panic and that the grocery store shelves are not empty during this COVID-19 virus?