Agriculture Committee on Oct. 29th, 2024

[Keith Currie, President, Canadian Federation of Agriculture]

Thank you, Mr. Chair, and thank you to all the committee members. It's good to be back in front of this committee.

As most of you know, my name is Keith Currie. I'm the chair of CFA, and I'm an eighth-generation farmer here in Ontario. As the chair mentioned in the previous session, we recently conducted our Hill day here in Ottawa, last week, where we met with many MPs and senators to discuss our priorities. In a lot of cases, they are part of our pre-budget submission, which everyone can find in front of them, which has a list of these priorities.

I'd just like to situate our recommendations in some broader context. Producers are facing challenges across the country, including interest rates and debt-servicing costs that are the highest they've been since the 1980s. Farmers are also facing more frequent and severe weather events, while at the same time anticipating the next labour disruption in the supply chain. Our sector is also struggling to find workers, with the most recent statistics pointing out a total of nearly 30,000 jobs going unfilled on the farm, costing the sector almost $3.5 billion in lost revenues. All this is happening against the backdrop of declining agricultural productivity growth when the demand for agricultural products and the food security concerns have increased.

We have several recommendations to target these challenges.

By raising the interest rate portion of the advance payments program and reintroducing the accelerated capital cost allowance, we would help farmers with cash flow and their ability to invest in their operations.

In addition, we recommend maintaining the priority focus on agriculture within the temporary foreign worker program to support farmers' seasonal labour needs, while at the same time supporting pathways to permanent residency for industries with year-round labour requirements.

We would also like to expand the extended interswitching pilot program to encourage competition among railways and enhance the overall efficiency of the Canadian supply chain.

Lastly, on the short-term list, we cannot wait until 2028, when the next five-year FPT framework will be implemented, to address the sector's disaster relief needs. That's why we are recommending that the Government of Canada, in partnership with the provinces, territories and industry, immediately convene a disaster relief summit and strike a task team to look at options to better respond to environment-related disaster events.

We also have several recommendations that might improve the long-term health of Canada's agriculture sector.

First, we need to reduce unnecessary costs and regulatory barriers that threaten our ability to compete internationally. The PMRA and CFIA are key government regulators under the health portfolio that directly impact the availability of pest control products, as well as the labelling, packaging, licensing, certification, etc. of Canadian agriculture and agri-food products. While these functions are critical to maintaining Canada's domestic and international reputation as a supplier of safe, quality agriculture products, decisions are made without sufficient consideration of the economic impacts or the competitiveness of Canadian businesses.

We would also recommend that the responsibility for both the CFIA and the aquaculture sector be transferred to AAFC, to ensure that policies are better aligned with economic objectives and to ensure that all of Canada's agriculture commodities are handled by the same department. Aquaculture is agriculture.

Our second priority involves the Canada Grain Act, which is increasingly outdated and challenged to both protect grain producers and respond to evolving global demands for their products. Another priority involves updating the Canada Grain Act to address key areas of concern to producers, while reaffirming the Canadian Grain Commission's mandate to maintain standards and regulate grain handling in the interests of grain producers.

Furthermore, if we want to reverse the trend of declining productivity growth in Canada, we need to invest in innovation and data-driven technologies. There are several challenges standing in the way of progress, including connectivity limitations, high upfront costs with purchasing precision agriculture equipment, farm data ownership concerns around trust, and how data is being used. As a result, we published a report called “Data as a Foundation for Sustainable Productivity Growth”, which includes several recommendations, including the creation of a pan-Canadian data strategy that would coordinate investment in digital skills, research, programming and farm-level data measurement to support Canada's productivity and sustainability objectives.

Finally, we all know that thousands of farmers and ranchers across Canada are heavily reliant on exports, while thousands more rely on rail service to get across critical inputs for essential farm practices. We need to find solutions that will reduce the risk of future labour disruptions, which are destabilizing for the Canadian economy, the Canadian public and Canadian farming. For that reason, CFA has been calling for the development of a critical food and farm input strategy that would prioritize the transportation of agriculture food products during labour disruptions and ensure Canadian producers have a long-term, stable source of supply for critical farm inputs needed to produce quality agriculture and agri-food products.

Thank you. I look forward to your questions.

[The Chair, Liberal, Kody Blois]

Thank you very much.

We'll now turn to the National Farmers Union.

Ms. Ward, it's over to you.

[Katie Ward, Past President, National Farmers Union]

Thank you very much.

Good afternoon, honourable members of the committee.

I appreciate the invitation to speak to you today concerning the priorities of the agriculture sector on behalf of the National Farmers Union.

As a general farm organization, with thousands of direct members from coast to coast to coast engaged in farming across all commodities and at all scales, the National Farmers Union believes in strong communities, sound policies and sustainable farms. In our view, the priorities of the agriculture sector over the coming years will be centred around concentration, disruption and resilience.

Concentration of suppliers and market outlets for farms and ranchers has been an ongoing concern for a long time now. The cycle of mergers and acquisitions is most recently highlighted by the proposed Bunge-Viterra deal. If the acquisition is allowed, Bunge will become the world's largest agricultural commodity trader, and the minor concessions so far required by the recent European Commission's approval of the deal will have a negligible effect on its ability to use its massive footprint to influence markets, prices and production to advance its own interests at the expense of farmers and consumers.

Corporate concentration in the food-processing and retail sectors has long been an issue for elected leadership and for regulatory bodies to grapple with. Meat-packing plants and grocery retailers are so concentrated that both farmers and consumers are withering under inelastic and uncompetitive pricing structures.

Data ownership, aggregation and transparency are likewise impacted by corporate concentration. From shared data platforms to precision agriculture and advanced data analytics tools, including artificial intelligence and its outsized energy requirements, farmers and ranchers need our elected officials to effectively protect our interests to ensure that we do not end up in the same boat as the general public on social media platforms, with us and our information being a product that's sold to others for their profit while we see negligible benefits. Aggregation of this data increases the risk of exposure that farms and ranches face. Ransomware and malware attacks can affect any aspect of our operations that has a connection to our increasingly online way of doing business.

Data aggregation and sale also have implications for farmland ownership consolidation trends, which have been accelerating in Canada for many years. This ownership concentration is particularly concerning when investment funds and housing developers accumulate farmland, which then inflates the shrinking inventory of farmland that's desperately needed by new and aspiring farmers who could otherwise start new enterprises.

There's great irony in farmland financialization as a strategy by investment funds to hedge against risk in other industries, when farms and ranchers are exceedingly susceptible to geopolitical shocks such as shipping interruptions due to overseas military conflicts, tariffs and other trade disputes between nations, and of course climate events causing disruption to our supply chains, to our ability to market our crops and even to our ability to produce a crop at all. Financialization of farmland is clearly not benefiting farmers in the aggregate, as farm debt currently sits at $146 billion, interest rates are high and land prices are increasingly decoupled from the productive value of land itself.

The negative impact that climate events are already having on the infrastructure that our industry depends on needs to be recognized as a clear risk to our food security and food sovereignty. Direct effects of extreme weather events caused by climate change have been hitting our farms and ranches for years now, and it will not surprise members of this committee that farmers remain concerned about the inadequacy of existing risk management programs in terms of accessibility, speed of process and financial coverage in the event of both localized and widespread disasters.

When we scan movement by private insurance companies worldwide, the fact that they are departing from entire jurisdictions based on flood or wildfire risk tells us we must both maintain and improve upon effective public risk management programs for agriculture. However, we got into this risky scenario together, and we can work together to mitigate the consequences and to adapt to the disruptions we now face.

As members of this committee know, the NFU is a passionate advocate for a farm resilience agency based upon the incredibly successful Prairie farm rehabilitation administration. We need a Canadian farm resilience agency to facilitate a transparent and independent knowledge exchange and the adoption of ecological practices that will reduce emissions on our farms.

We are also calling on government to reinstitute efficacy testing for non-fertilizer farm inputs that would make use of existing expertise among staff at CFIA and AAFC, which prior to 2013 were a statistically reliable alternative to fossil fuel-based fertilizers. Farmers are facing more than enough financial risk. We should not continue to force them into a buy-and-try approach to reducing emissions on an ad hoc basis.

On a strategic level, we are nearing the end of the second year of the sustainable agriculture strategy process, and the NFU believes it's increasingly important that the government complete and release the SAS. Going further, we believe the strategy should be used as a basis for expanded programs, policies and funding to help farmers adopt emissions-reducing, resilience-building and biodiversity-protecting practices. Along with Farmers for Climate Solutions and Canadian Organic Growers, the NFU has advocated that the government should consider funding levels on the order of $860 million in order to meet the sustainability needs of the sector under this strategy.

Of course, sustainability in the agriculture sector cannot be achieved without a plan for generational succession on our farms and ranches. All the topics I've touched on are at the top of mind for our young members, as well as aspiring farmers and ranchers who might not be so young anymore. The NFU's youth and BIPOC caucus members are very engaged around land access issues, the lack of an equitable strategy focused on the farm labour crisis, and the lack of a comprehensive strategy around succession in agriculture, which has resulted in aging farmers relying on the financialization of farmland to fund their retirement, which is further driving farmland out of reach of the next generation while putting our food security and food sovereignty at further risk.

Thank you very much. I look forward to your questions.

[The Chair, Liberal, Kody Blois]

Thank you very much.

We'll now turn to Mr. Dykstra for up to five minutes, please.

[Phil Dykstra, President, P & D Dykstra Farms Inc.]

Thanks, Mr. Chair.

Ladies and gentlemen, thanks for having me here.

I want to update you a little on what we're doing. I think you were briefed earlier—maybe last year—by the Ontario Pork Producers' Marketing Board in terms of the situation on Ontario hog farms. You will be well aware that, 10 years ago, we lost Quality Meats. That has moved a lot of hogs to Quebec in the last couple of years. Olymel closed a couple of hog-packing plants, which has essentially dispersed Ontario hogs: 25,000 hogs a week are now being sent to other places, mostly to the U.S., while some go to Manitoba.

Anyway, the freight bill is significant. We're exporting into the U.S. ourselves, now. We feel there's been a loss of jobs and added value, and we also feel we're subject to trade and border risks as our live animals cross. We know we've seen trade action on live hogs. Probably every 10 to 12 years, we see something, whether it's MCOOL or anti-dumping, you name it. There are certainly going to be a lot of eyes on the presidential election next week to see how that plays out. Certainly, discussion around Bill C-282 and some of these things gives us pretty big concerns.

What has happened now is that a number of us primary producers—15—have joined together and purchased a small plant just outside of Arthur, Ontario, called Domingos Meat Packers. Domingos Meat Packers was a small provincial plant harvesting 1,900 hogs a week. We now have that business running up to 3,000 hogs a week. We are in the process of pushing dirt, pouring concrete, laying down footings and building a new federal plant just outside of Arthur, Ontario. The goal of this new federal plant will be to harvest, at its capacity, 12,000 hogs a week on a single shift. That, plus the small provincial plant, will bring us to a total of 15,000 a week. We have made a significant investment.

I'm the son of an immigrant farmer. I have a couple of sons farming with me. My wife and I are fortunate to have six grandchildren. God willing, a couple of them will stick around. However, this whole strategy is about sustainability, integrating our business and making sure we're relevant in years to come. Collectively, we put down $25 million of hard capital. We're in the process of drumming up more cash to put in, and we have leveraged Farm Credit Canada for a sizable loan. All of this is to invest in a new $60-million facility that will add value to our pork, reduce our transportation costs by $13 million and reduce our border risk. We're going to add 300 direct jobs in the area of Waterloo and create another 20 management positions. We are feeling pretty grateful and blessed that we can move ahead with a project like this, that we have been able to leverage some good people at Farm Credit Canada, and that we have a good place in Ontario to grow.

We still have a few more priorities that need some attention. We probably won't be able to get those done near-term. We're wondering if there are ways and means we can work together to build, perhaps, a water treatment plant, which would help us reduce the need for water and recycle water. We're looking at things like truck washes to minimize disease risk and enhance our biosecurity. We're in the process of setting up a training centre. We're likely going to need to invest about $500,000 to train people over the next three years, so there's a lot going on.

Anyway, I don't know how much time I have used. Everyone talks very fast at these meetings. It's pretty impressive. I'll just say that, if there are any questions afterwards, I will be happy to entertain them. I could talk about this all day.

Again, thanks for welcoming me here and letting me share this opportunity we're working on.

[The Chair, Liberal, Kody Blois]

That was very well done, Mr. Dykstra. It was four minutes and 53 seconds, so it's right on time. You fit right in here. It's great to have your testimony.

Colleagues, we are going to turn to questions. Four six-minute rounds are about 24 minutes. I will probably allow for one round and a truncated second round for any follow-up questions we didn't get to, in order to be fair to our colleagues in the larger parties.

I'm going to start with Mr. Barlow from the Conservatives for six minutes.

[John Barlow, Conservative, Foothills, AB]

Thanks, Mr. Chair.

I'm going to be splitting my time with Mr. Epp.

I want to start with Mr. Currie.

You mentioned the PMRA. We had CropLife here on the previous panel, and I didn't have time to ask another question, but I'm going to ask it of you. Over the next five years, $80 million has been allocated to the PMRA. We certainly heard how the PMRA is increasing the registration fees for plant protection products by 250% and about the impact that's going to have on Canadian farmers. Do you have an idea of where that $80 million is being spent, and is there some consultation happening with the CFA?

[Keith Currie]

The answer is no. I don't know where that money is being spent.

What we have found increasingly with governments in general is a lack of consultation on just about everything, this included.

I think that, as we go forward, it's not about where we're going but about how we get there and how we get there together. Certainly, if the PMRA could be a little more transparent on all this coming about, I'm sure we could find a pathway that would be effective for all parties involved. However, this kind of increase in fees is only going to come back to the producers I represent. At the end of the day, they're going to have to pay this because these costs are not going to be borne by the companies that are applying for these new products that are coming on board.

I don't understand where the fees are coming from, and I don't understand where the money is being spent.

[John Barlow, Conservative, Foothills, AB]

One example would be with lambda-cyhalothrin. That is one important crop protection product on which it seems the PMRA knows it made a mistake with regard to how that reassessment was done.

I think we heard this from our previous witness, but I want to ask you as well. With this increase in fees and this additional funding, we would be 10 times more expensive than our closest competitor and trading partner, the United States, making us that much more uncompetitive. Are you seeing any better service for this increase in fees or these additional government dollars that have been given to the PMRA?

[Keith Currie]

Certainly, CropLife would be better able to speak to the actual service on the ground. However, from what I'm seeing and hearing from my members, the answer is that the service has not changed.

I think it leads into what was mentioned in the previous session. I know there's a private member's bill, Bill C-359, that's been going through the House. It would lean heavily on our trusted partners around the world to help us expedite some of these products that we don't have but potentially could have because our partners are using them. Again, this is a competitive disadvantage.

These are the kinds of things that, through discussions, we hope you could talk about with folks like those at the PMRA in order to make life easier for us on the ground: to be more competitive, to be more productive and to be more efficient.

[John Barlow, Conservative, Foothills, AB]

Yes, it's a good thing we have good ideas like Bill C-359. That should be a government bill, but unfortunately a government member had to do it as a private member's bill.

With regard to another issue, we do have a study perhaps coming up in the next little while. We've been talking about interswitching, but there's an important date coming up when the railways are relinquishing responsibility for rail crossings that are on private property and farmland. Can you just give us a quick assessment of the impact that this could have on your members—certainly as Canadian farmers—having to take the responsibility for the upgrading of these crossings?

[Keith Currie]

My understanding is that the premise around these crossings is primarily around siting, which makes sense from a safety aspect. However, we've had members—particularly in Ontario, where it seems to be a bigger issue than in other provinces, but not exclusively in Ontario—having to potentially spend up to half a million dollars to upgrade crossings. I don't know what farm operation has half a million dollars sitting in its back pocket to upgrade a crossing.

Somewhere along the line, the rules got changed, because the railways were always responsible for these upgrades and for maintaining these crossings. It will be very expensive for those who have rail lines going across their properties, and if they can't afford to pay it, it would literally be cutting farm operations in half.

[John Barlow, Conservative, Foothills, AB]

Thank you, Mr. Currie.

I'm sure those costs will be insurmountable, but farmers can't pass on those costs to anyone.

I'm going to relinquish the rest of my time to Mr. Epp.

[Dave Epp, Conservative, Chatham-Kent—Leamington, ON]

I'll be very quick, and I'll stay on the subject of railways, to start.

Ontario has been told that the two major railways will no longer respect the Ontario Drainage Act. Are you hearing that across Canada—that they're also pulling out of other drainage aspects in other parts of the country?

[Keith Currie]

We're looking into the cross-Canada part. We certainly are well aware of what's going on here in Ontario with respect to drainage and how they are pulling out of that. Even though things in the act were changed 20 years ago or something, it's just news to us now, so we are looking into the broader aspect of it across Canada.

[Dave Epp, Conservative, Chatham-Kent—Leamington, ON]

Thank you.

I will switch gears and go to Bill C-280.

I'm going to invite comment from the CFA and our friends from Quebec, the fruit and vegetable growers.

Do you know the position of the Canadian Bankers Association with respect to Bill C-280? Have you seen or heard anything, or have you met with them? Are they supportive of Bill C-280? Are they opposed to Bill C-280? Have you seen a public statement?

[Keith Currie]

I can't say that I've seen a public statement, but I've heard they're not in favour of it. They seem to feel it's going to impose some kind of undue financial stress, when the reality is.... I mean, it's a program we had some 20-odd years ago that is looking to be reintroduced. It will give some financial assurance to producers, especially in your area, which is large in horticulture production. When they send a product to market, they're going to get paid for it in the event of a buyer's insolvency or non-payment.

[Dave Epp, Conservative, Chatham-Kent—Leamington, ON]

I want to give a second to our friends from Quebec.

Do you have a comment on Bill C-280, as well?

[The Chair, Liberal, Kody Blois]

Go very quickly, because we are at time.

I don't know if that made it through, Mr. Epp.

I will acknowledge this for our friends from Quebec and the CFA: This committee shares the concern about the importance of passing Bill C-280. We've written a letter to the Senate saying, “Get on with it”, especially with a vote of 320 to 1 in the House. It has clear and uniform support in the democratically elected House of Commons. We share that concern.

Thank you, Mr. Epp.

We'll now turn to Ms. Taylor Roy.

You have six minutes.

[Leah Taylor Roy, Liberal, Aurora—Oak Ridges—Richmond Hill, ON]

Thank you, Mr. Chair.

I will be sharing my time with my colleague Mr. Louis.

My question is for Mr. Phil Dykstra.

First, I want to thank you for the project you are part of. I'm sure it's welcome news to Ontario hog farmers and the agri-food sector overall. We know it's going to add value to what we're doing in Canada. Since the closure of Olymel, this has obviously been much needed. I know it's going to add value, and we're going to see reduced emissions through shorter drives. You mentioned the cost of that. It's also about environmental cost and greater food security for Canada. You mentioned the border issues, as well. Vertically integrating like this is something that I think all Canadians think is wise, especially now, when pork is one of the lower-cost animal proteins available. It's very important. We want to support a Canadian gate-to-plate initiative.

I'm wondering if you can talk about what support you have received from the Government of Ontario, and what measures our government could take, in addition to the FCC credit package, to support the development and sustainability of this producer-owned pork-processing plant in Arthur, Ontario.

Also, before I go there, I want to commend you, because I noticed in the prospectus you sent over that you're also focused on net zero and environmental sustainability. Thank you for that.

[Phil Dykstra]

Thanks for the question.

At this point, we are in the process of meeting with MPP Matthew Rae out of Perth—Wellington. We have another scheduled meeting with them to further outline our needs. Probably the biggest needs, from a provincial perspective, are related to infrastructure. We expect we're going to have to spend another $1.5 million to bring up-to-date hydro power into the plant. We would dearly love to eliminate the need to truck in propane, but rather pipe in natural gas. We will be using that. Those are a couple of things we will focus on at the provincial level.

When we talk about being net-zero, we want to reduce our transportation. A lot of our transporters have to leave and go elsewhere to wash their trucks. You're probably also aware of the African swine fever risk—ASF. We are tapping into CFIA funds to work at setting up the old plant to be used for welfare. Should we have an African swine fever outbreak—God help us all if we do—we will have a plant set up that can deal with some of the fallout of that. The truck wash piece would help in managing the risk of disease and moving things beyond our little plant there. That's a big piece.

The next piece, of course, is water treatment. We'd like to put a DAF system in there. We think that would be very beneficial, since a processing plant uses about 300 litres of water per hog per day. We go through a lot of water. If we can recycle and reuse that and not tax the aquifers underneath us, it would also be very beneficial and help our sustainability plan.

[Leah Taylor Roy, Liberal, Aurora—Oak Ridges—Richmond Hill, ON]

Thank you very much, Mr. Dykstra.

We want to ensure that these facilities are environmentally friendly and conserve our water, so those sound like good initiatives as well.

I am now going to pass my time to Mr. Louis.

[Tim Louis, Liberal, Kitchener—Conestoga, ON]

Thank you for that.

Before I get to the questions, I just wanted to mention a study I'd like to do. Hopefully, it has an interest to all of us, specifically my colleagues from southwest Ontario. The spotted lanternfly is an invasive species that poses a significant risk to agriculture. It's been in the United States, and now it's been spotted in southwest Ontario. It can lead to damaged crops, increased production costs and reduced yields.

I would like to put a notice of motion that, given that spotted lanternflies have been detected in Windsor, Ontario, posing a threat to agriculture, the committee invite officials to appear and brief the committee on testing, surveillance efforts and threat mitigation steps being taken to protect Canada's agriculture sector in southwest Ontario, and that one in camera meeting be set aside for the study.

In the interest of time, I won't discuss it now. I just wanted to put that down as a notice, and we can talk about it a bit later.

I will get to the questions.

Ms. Ward, can you expand on how the National Farmers Union is promoting sustainable farming practices among its members? What supports would you like to see increased as we move forward with our policies?

[The Chair, Liberal, Kody Blois]

We have about 45 seconds left, so answer in that time, if you could.

[Katie Ward]

Thank you for the question.

We actually have piloted a series of NFUniversity webinars over the last number of years, inviting ecological speakers and practitioners to exchange knowledge with our producer members. We're very engaged, as a founder of Farmers for Climate Solutions, as well as working on the sustainable agriculture strategy and consulting on that. We're very focused on spreading the word about ecological agriculture and agroecology to our members.