Agriculture Committee on June 9th, 2022

[The Chair, Liberal, Kody Blois]

Thank you very much, Minister, and thank you Mr. Epp for the question.

We're going to go to Mr. Lewis again for just one question, please.

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

Thank you, Chair.

Thank you, Minister Solskyi. I really appreciate your time and dedication.

We've discussed here and elsewhere that the war is having a devastating effect on everyone, including farmers. We've heard that farmers are short of diesel. Some are scared to plow their fields for fear that they are mined. Those who are not fighting on the front lines are facing their own challenges on the farms.

Just to sum up some of the things we've heard, there are the lack of supplies, the price of existing supplies, the lack of work force, the reduced number of livestock and crops planted, and also storage capacity issues. We did hear from the deputy director-general of the United Nations Food and Agriculture Organization that in Ukraine, small farmers produce an overwhelming amount of the food. It's the small producers in your country.

Here in Canada, we represent farmers in our ridings. As we meet with you, you're representing the voices of farmers for all of Ukraine, so I thought it might be fitting to end by having you paint a picture for all of us. Expand on the challenges for the average small farm in Ukraine and on their determination to keep feeding Ukrainians and, indeed, feeding the world in the face of those challenges.

In other words, I want to give you an opportunity to share with us your pride in Ukrainian farmers.

Thank you.

[Mykola Solskyi]

[Witness spoke in Ukrainian, interpreted as follows:]

Indeed, we are very proud of our Ukrainian farmers. They haven't given up. They're working hard every day. Seventy-five per cent of the lands have been planted and they're being laboured on. We see that they're sometimes working just a few hundred metres from where the bombings are.

The small farms are under 100 hectares. According to European standards, these are large farms, but according to Ukrainian standards, these are small farms.

We have received a promise of assistance from the European Union. There will be a compensation per hectare because our farmers are working in more difficult conditions than others. They have less access to loans from banks, etc. These farmers will receive assistance in August and September from the European Union.

[The Chair, Liberal, Kody Blois]

Thank you very much, Mr. Louis.

Thank you, Minister.

That concludes our first panel.

Minister, let me say this from the bottom of my heart and indeed from all the colleagues, as you've already heard, and from others who aren't here: We stand with you. Thank you so much for taking the time to be here with us to provide that important testimony. Our commitment to you is that our study will provide recommendations to our government on how best we could help.

I heard during your testimony that you will indeed be engaging with our honourable minister, Marie-Claude Bibeau. We look forward to supporting her and supporting the government on how best we can help you and your people. As you mentioned, we're very proud of your heroic and brave farmers.

We'll leave it at that. We'll let you enjoy your night and thank you so much for being here.

[Applause]

[Mykola Solskyi]

[Witness spoke in Ukrainian, interpreted as follows:]

Thank you, distinguished Chair. Thank you, committee members, and thank you to the entire Canadian people.

[The Chair, Liberal, Kody Blois]

Colleagues, don't go far. We have officials from Global Affairs Canada who are already on the line. Normally, I say wait two or three minutes. I'm saying now it will about 30 seconds, so please just stay where you are.

If you want to grab a quick coffee, go ahead now, but we're going to suspend for about 90 seconds and we'll be right back.

[The Chair, Liberal, Kody Blois]

Colleagues, thank you so much. As I mentioned, we're turning around very quickly.

For our second hour of the panel, from the Department of Foreign Affairs, Trade and Development, we have Peter MacDougall, assistant deputy minister, global issues and development.

Mr. MacDougall, welcome. Thank you for being here. We sincerely apologize for the delay. That is the nature of procedure in the House of Commons sometimes, but thank you for your willingness to stay.

We also have Tara Denham, the director general of the Ukraine strategic action team.

You have up to five minutes for opening remarks and then we're going to proceed with questions.

We obviously heard from Minister Solskyi just today. It was powerful testimony. We know that you will be watching this entire issue closely. I'm going to turn it over to you for opening remarks and then we'll get to questions.

Mr. MacDougall.

[Peter MacDougall, Assistant Deputy Minister, Global Issues and Development, Department of Foreign Affairs, Trade and Development]

Thank you very much, Mr. Chair.

Your study on global food insecurity is timely, because the world is truly in the midst of a serious food crisis.

After decades of steady decline, the trend when it comes to the global hunger problem has reversed since 2015, primarily due to climate change, conflicts, the COVID‑19 pandemic and economic downturns.

In 2020, before Russia invaded Ukraine, food insecurity had already reached record levels. An estimated 800 million people are hungry. Russia's invasion of Ukraine dramatically exacerbated the situation and is proving to be the biggest shock to the global food system since the 2008-09 food crisis. According to the World Bank, an additional 40 million people around the world are at risk of hunger as a result of the invasion.

The Ukrainian minister said how important fertilizer is; this is also a crucial issue. Russia's exports account for 14% of the world's fertilizer exports, and 25 countries are heavily reliant on fertilizer from Russia and Belarus. This, combined with rising fuel prices, has led to significant fertilizer price inflation. Between April 2020 and March 2022, global fertilizer prices rose 220%, their highest two-year increase since 2008.

According to a warning from the African Development Bank, the continent's food production could fall by 20% because African farmers have to pay 300% more for the fertilizers they import.

Together Russia and Ukraine represent about 15% of global cereal exports. Countries face immediate risk due to the disruptions that occurred after the invasion. Many of these countries are already acutely food insecure, like Yemen, Mauritania, Madagascar and many others.

However, beyond the disruption of supplies, the Russian invasion of Ukraine has had a major impact on food prices. Food price inflation is now the major concern as world food prices have reached historic highs, exceeding all previous food crises stretching back to the 1970s. In March global food prices hit the highest level on record. They were 30% higher than they were in January and over 60% higher than they were prior to the start of the pandemic.

The World Bank estimates that each percentage point increase in food prices means that we have 10 million more people in extreme poverty worldwide. Food insecurity and malnutrition are reaching untenable levels in regions and countries such as the Sahel, Yemen, Sudan, and Haiti.

Rising food prices could also trigger a new wave of political instability, and the minister noted that the recent unrest and demonstrations in Sri Lanka, Pakistan, Tunisia, Sudan, Iraq and Peru are linked in part to the worsening food crisis.

Russia bears particular responsibility for the global food security crisis. It has attacked one of the breadbaskets of the world, destroying Ukraine's capacity to supply the world with key agricultural commodities such as wheat, sunflower oil, sunflower seeds and barley. Before the war, Ukraine exported 95% of its grain via the Black Sea. Russia is blockading Ukraine's ports from being able to export grains and other goods and is also shelling the rail lines that are being used to reach alternate ports in Romania and elsewhere.

Russia is also restricting access to its own agricultural commodities and fertilizers. The Russian invasion has underscored the need to ensure that Canada and other donors not only provide short-term humanitarian assistance to respond to this crisis but that we also need to enhance our efforts to make food systems more resilient in the face of climate change, conflict and other shocks.

In 2021 Canada's support for sustainable agriculture and food systems reached its highest level in decades. This increase was driven by large-scale investments in agriculture and food systems through our climate finance program, working with organizations such as the FAO and the International Fund for Agricultural Development.

The current crisis has put food security at the top of international discussions. We are coordinating within the G7 and other multilateral fora to ensure a coherent and coordinated response with other partners.

Thank you, Mr. Chair.

[The Chair, Liberal, Kody Blois]

Thank you very much, Mr. MacDougall.

I don't have any other speakers.

Ms. Denham, I think you're here to answer questions. Thank you. I see you nodding.

So I will proceed right to questions.

We're going to start with the Conservative Party.

Mr. Falk, it's over to you for six minutes.

[Ted Falk, Conservative, Provencher, MB]

Thank you, Mr. Chair.

Thank you, to the officials, for stretching your day out for us and providing us with this useful testimony.

Earlier in the week we heard from a member of Parliament of Ukraine, Yulia Klymenko, that she believed there was a plan to create this food shortage and crisis, and that the plan would see massive migration from northern African countries, Asian countries and Arab countries into the European area in an attempt to politically destabilize that area by overwhelming their social system. You seem to suggest that this is maybe something you would agree with, Mr. MacDougall. Is that correct?

[Peter MacDougall]

I think what I would agree with is that one of the potential consequences of the conflict, the blockading of the Ukrainian ports and Russia's own actions in limiting its exports of fertilizer and its grains, is that it can have destabilizing effects in all parts of the world, particularly, as the minister mentioned, in a number of African and Arab states, where there's a high level of dependence on both Russian and Ukrainian grain.

[Ted Falk, Conservative, Provencher, MB]

Okay.

This question may be better answered by Ms. Denham. We talk a lot about Ukraine being the breadbasket and we recognize that they're a major grain producer, but they also have a vibrant livestock slaughtering/processing value-added industry. Do you have any comment on how that industry is faring during this difficult time?

[Peter MacDougall]

I don't know if Tara will be able to answer that, but I will let her take a shot at it.

[Ted Falk, Conservative, Provencher, MB]

You're welcome to answer it as well, Mr. MacDougall, whoever is best suited.

[Peter MacDougall]

I cannot answer it.

Thank you, Mr. Chair.

[Tara Denham, Director General, Ukraine Strategic Action Team, Department of Foreign Affairs, Trade and Development]

Thank you.

Again, I'm not able to answer it in detail. What I can say is that in our bilateral development assistance, we do provide support to some of the dairy processing facilities and some of the smaller farmers. But I can't speak in detail to that particular question.

[Ted Falk, Conservative, Provencher, MB]

What are some practical things that you, as a department, have thought we can do to alleviate some of the strain caused by this food crisis in Ukraine?

[Peter MacDougall]

Let me take that and respond from a couple of perspectives.

First, in terms of our response globally, we have disbursed more than $500 million in humanitarian assistance, the vast majority of that food assistance to countries around the world, many of which you mentioned. We also have invested several hundred million dollars—and there's more to come later in the year—in food systems around the world. Specifically in Ukraine, we have, since the start of the conflict, contributed $245 million to our humanitarian response to Ukraine. The vast majority of the funds have flowed to Ukraine. Nearly $100 million of that is direct food assistance and cash support. Other aspects of it will support Ukrainian refugees in neighbouring countries.

Tara, you may wish to add to that.

[Tara Denham]

Sure, if I may, I will add a bit more to Peter's answer.

We have a long history of a bilateral development program with Ukraine, and so we already have the connections and funding going to local organizations.

One of the first actions we took was to provide as much flexibility in that programming as we could so that any of the organizations working within Ukraine could adapt and change their project activities, and be flexible and respond to the needs.

In terms of some of the concrete activities that have happened—I did mention this quickly in my last answer—six dairy co-operatives are actually supported, which are helping to procure the forage and collect and process milk. That's being funded by Canada. We have also supported the distribution of potato seeds to over 2,600 farmers in western Ukraine to help them seed and support their access to the smaller plots of land. We're also supporting a dairy processing co-operative. That is another one that is being significantly funded by Canada.

[Ted Falk, Conservative, Provencher, MB]

Can I interrupt you for just a moment? I just want to get this on the record, and I think I'm fast running out of time.

My parents, like those of Mr. Epp, and my grandparents all came from southern Ukraine as well. We have an organization there called Mennonite Centre in a town called Molochansk. I had a report this last week in church from the executive director, who was in attendance here in Canada. She said that—which is consistent with the report we just got from Minister Solskyi—that the Russian people are working with food distribution organizations to a degree to allow a compassionate response to individuals who are in the occupied area.

Is that your understanding, as well?

[Tara Denham]

That's my understanding. There are a lot of organizations, and Ukrainians are supporting and working with a number of the entities that are in Ukraine. Of course, there are a lot of Ukrainians who have stayed in Ukraine to provide support. The areas that I was speaking to were where we're providing the Government of Canada funding, but you're absolutely correct that there would be many other national entities and civil society organizations. It's a very vibrant community in Ukraine.

[The Chair, Liberal, Kody Blois]

Thank you, Mr. Falk. You're right on time at six minutes.

Thank you, Ms. Denham.

I'd also like to recognize that Ms. Lianne Rood is replacing Mr. Barlow.

Welcome back to the committee. You were here in the 43rd parliament, and you're certainly no stranger to agriculture, so welcome.

We're going to Mr. Turnbull for six minutes.

[Ryan Turnbull, Liberal, Whitby, ON]

Thanks, Chair.

Thanks to our panellists today. What a great meeting.

I want to start with a question.

I know, Mr. MacDougall, that you started your opening remarks by listing some of the countries that were impacted. This morning, we had the opportunity to hear from Beth Bechdol, deputy director-general at the FAO, and she listed some information about hot-spot zones that were the most food insecure.

I'm wondering if you could fill us in on the countries whose food supply is the most impacted by Russia's illegal war on Ukraine.

[Peter MacDougall]

There are layers of vulnerability that various countries have, but certainly the ones that are at acute risk, either because of a shortage of food or a shortage of fertilizers and increasing prices in both cases, are countries like Egypt, Yemen, Lebanon, Mali, South Sudan and Ethiopia. There are others, of course, but those are the ones that we are most concerned about, because, in many cases, they already had existing challenges and underlying conflicts or climate change issues which, when you add the Russia-Ukraine consequences, put them in quite dire conditions.

[Ryan Turnbull, Liberal, Whitby, ON]

Thank you for that.

In terms of the coherent and coordinated response that I think you referred to, are there multilateral discussions going on to have a collaborative approach to helping feed or supply those countries?

I would ask, based on Canada's being such an agricultural superpower in many respects and producing so much itself, if there is a chance for Canada to step up production and help to serve some of these countries that are in need.