Agriculture Committee on May 7th, 2024

[Pascal Forest]

I've heard those comments made by my colleagues, and I agree with them.

After a disaster, you don't want to wait two years to rebuild your house. You start over and you keep going. The same is true in our case. Agriculture is in perpetual motion. We finish the season, we make a little progress, then we start over.

So faster is better; that's for sure.

[Yves Perron, Bloc, Berthier—Maskinongé, QC]

One of the current issues is the fact that expenses have risen sharply as a result of interest rates. You need to know that agriculture is a sector where considerable investment is needed to generate revenue. You have to invest eight dollars in order to generate one dollar of revenue.

Please give us a few more details on that. Are there any specific measures the government should introduce? Quebec farmers are taking action and making considerable demands of the Quebec government. However, the federal government is responsible for half of that portfolio. So what can the federal government do to improve the situation?

[Pascal Forest]

Claims could also be filed with the federal government. The idea would be to provide protection by capping interest rates at a certain level, at least until rates start to go back down in the short or medium term. That compensatory measure could provide some assistance during the transition period.

[Yves Perron, Bloc, Berthier—Maskinongé, QC]

You discussed the code of conduct and bargaining power in your presentation. Since you sell perishable goods, you're often put in a tight spot and forced to give in at the last minute. We were recently told about situations in which suppliers had delivered perishable goods to grocery stores, which then, a few days later, called to tell them to take back two thirds of their order.

Have you heard about those situations? Have you experienced that too? What would you like to tell the committee about those important issues?

[Pascal Forest]

What's important in all this is to know that we in the agriculture sector are mostly family businesses that have to deal with multinational corporations. Obviously the concentration of distribution doesn't really work to our advantage. It's the multinationals that make the decisions, and they virtually decide who lives and dies. We don't really have any alternatives. As I said earlier, we do business with the United States. Things are really different on the other side of the border.

[The Chair, Liberal, Kody Blois]

Thank you very much, Mr. Perron.

Maybe I'll remind everyone to keep their phones on silent. I know we forget sometimes.

I'll also remind our witnesses to keep their cameras on. That would be Mr. Vinall.

There you go, my friend. Folks might want to ask you questions.

It's over to you, Mr. MacGregor.

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

Thank you, Mr. Chair.

Thanks to all of our witnesses for joining us today.

Monsieur Forest, I'd like to start with you.

In the horticulture sector, especially over the last four years, can you tell me what it's been like in terms of your input costs and generally across the sector? What has the trend been like since 2019-20 until now?

[Pascal Forest]

The costs went up, for sure.

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

By how much have the costs gone up, would you say? Was it considerably?

[Pascal Forest]

They went up considerably, yes.

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

Is it far more than you've ever seen in your career?

[Pascal Forest]

Oh, of course.

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

Did you know that during that same time, when you look at oil and gas costs and fertilizer costs, the companies in those sectors have seen some of their best years ever on record?

[Pascal Forest]

I agree with you.

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

I think we're seeing a story in Canada where at both ends of the food supply chain, the consumer and the primary producers are really getting the short end of the stick, while a lot of people in the middle, whether it's the people who supply the inputs or the people who control how food is retailed, are having some of their best years ever.

We see the situation that has developed in Canada, and it has not been just over the last eight years. I think this has been a development over 40 years through successive Liberal and Conservative governments.

From your perspective, how should the federal government intervene to try to swing the pendulum back so that it's fair both for people in your sector and for consumers at the other end?

[Pascal Forest]

I can tell you what would be good to see and what would make us feel supported by the government.

First, I'd like to live solely off the market. I basically don't want the money I earn to come from subsidies or government assistance. However, if my competitor is receiving assistance, I definitely want to be able to receive it as well. As I said earlier, it really has to be a fair fight. In the competition game, we have to be able to fight on equal terms. My thinking won't change on that point.

The idea would be to establish standard reciprocity, to use the same plant protection products and to have the same access to foreign workers. All of that is incredibly complex, every year. There are always surprises. What doesn't surprise us, however, is that agricultural production occurs at the same dates every year and that everyone here eats in the morning, at noon and in the evening. There are no surprises there.

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

You talked about the challenges of bringing the next generation into farming. They're looking at the state of farming and the challenges, and they're saying that it's not something they want to put themselves through.

You talked about a number of subjects, but I want to look at the existing suite of business risk management programs. You talked about the delays between when you put in a claim and when a payment is issued. I think two of the programs that are most currently cited during this study are AgriStability and AgriInsurance. The current agricultural partnership lasts until 2028. When you look at AgriInsurance and AgriStability, which one of those programs do you think would be best to be reformed to be more responsive?

[Pascal Forest]

I think all the programs should be reviewed so that everything is covered. Of course, agriculture changes, the weather changes, and markets always adjust, but necessarily in the short term. We have to try to cover everything.

For example, as Mr. Drouin mentioned earlier, we've never seen such weather swings. Consequently, if we don't have anything that reacts to weather swings as quickly as they occur, we'll definitely be left to our own devices.

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

Thank you for that.

I think that's been a common theme. Especially during this study, farmers from every sector have been telling us that they are on the front lines of climate change. We just heard a witness say that blossoms are coming out a month earlier than when he first started. Thank you for adding your expertise to that.

I want to turn my next question to Sustane Technologies.

I was just recently in Vancouver at the Canadian Produce Marketing Association. They hosted their big trade show at the Vancouver Convention Centre. A big topic there was indeed the use of plastics in the industry. There was a panel discussion on not only the role government should play, but also the role that industry has to play.

I represent a riding on a coastal environment, so microplastics are a very real concern of ours, given that they eventually end up in the ocean. There's significant concern about bioaccumulation, especially in the seafood that we consume on the coast.

I want to hear a little bit more detail from you on the role that you think the government can be playing. I think we're at two polar opposites currently. We have what the government's put on offer and what the Conservatives are countering with.

It sounds like you're trying to find a more nuanced middle path. I'm just wondering if you can explain a little bit more about that.

[Peter Vinall]

Thanks so much for the question.

Plastic waste is obviously an issue that goes across all sectors, including agriculture. We have a solution that can help with that. We can take the least recyclable plastic that goes into a landfill.... Even with the plastic you put on the curb for recycling, typically 50% of it doesn't get recycled; it ends up in the landfill. We can take those streams and recycle them with our technology.

We have an offtake with a petrochemical group that has now confirmed that they can use our product. They've told us that it's the best in the world. This is a product called naphtha that we make from plastic. Our quality is the best, we're being told. It can be used as a drop-in replacement for fossil naphtha, to make plastic. That's a breakthrough we're really proud of and that we're hoping to scale now.

The other point I think I would make is that we hear a lot about plastic in the ocean. That doesn't come from Canada. That comes from other countries. However, in Canada, we freely export our waste plastic to other countries and we call that recycling. I think there's a role for government to put an end to that, frankly.

“Wishcycling” is a term that I hear a lot lately. We put it out on the curb. We think it's going to get recycled, but the reality is a lot of it gets exported to other countries that don't have our standards and controls.

I think there's a clear role for government to say that we've had enough of that. We have a made-in-Canada solution that can take these plastics in Canada, turn them back into feedstock—circularized plastic—and put an end to that.

That would be my response.

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

Thank you.

[The Chair, Liberal, Kody Blois]

Thank you, Mr. MacGregor.

Thank you, Mr. Vinall.

I now give the floor to Mr. Lehoux for five minutes.

[Richard Lehoux, Conservative, Beauce, QC]

Thank you, Mr. Chair.

Thanks to the witnesses for being with us.

Mr. Forest, you briefly outlined your views on the code of conduct. What I retain from that is that, in your view, if no agreement is reached by May 31, something will definitely have to be done.

Are you confirming that today? I share that view as well, but I'd like to hear you say it.

[Pascal Forest]

I confirm that it's important that this become a really serious issue. We producers are serious, and it's important that we be respected and taken seriously. As I said earlier, as a result of the way distribution is concentrated, these actors are simply too strong. Family businesses, small, medium and large, will never be able to compete with the multinationals. We need something that will provide a framework for this and that respects both sides.

[Richard Lehoux, Conservative, Beauce, QC]

So you agree that, if all the major players don't get on board, this code will have to be made mandatory because everyone will have to comply with it for it to make any sense.