Agriculture Committee on June 9th, 2022

[Richard Lehoux, Conservative, Beauce, QC]

Thank you, Mr. Chair.

Mr. Minister, thank you very much for being with us this afternoon. As my colleagues have said, our hearts are with you.

We know that of the commodities in storage, wheat is the most important, and it has a limited shelf life. What will happen if you fail to build the temporary storage warehouses? Wheat does have a maximum shelf life, after all.

[Mykola Solskyi]

[Witness spoke in Ukrainian, interpreted as follows:]

Sometimes the situation is critical. If we do keep this grain even in temporary storage facilities, we understand that, depending on the type of grain, we would have only a year, or two at the most. We hope to use this time in order to improve the work of the ports and obtain some improvement on transportation towards Europe. We will need several months in order to achieve this.

If we do not have enough storage facilities, obviously this will be a problem, in particular for maize. Maize can be kept for a long time, but we still may have a problem next year if we do not manage to preserve the harvest of this year. A lot of it will be left rotting in the fields.

[Richard Lehoux, Conservative, Beauce, QC]

Thank you, Mr. Minister.

You stated earlier that Russia is currently targeting agricultural facilities much more. This includes everything from port infrastructure to road and rail networks. If this continues, there's going to be significant damage and it will be more difficult to rebuild in a shorter timeframe.

What impact will this have on global grain supply? Some are suggesting that a famine is possible. How do you perceive the situation in Ukraine?

[Mykola Solskyi]

[Witness spoke in Ukrainian, interpreted as follows:]

Distinguished committee member, when we were speaking with an FAO representative a month ago, here's what we said. If we're talking about wheat in Ukraine, we're talking about three harvests simultaneously, because we're unable to export the harvest of last year. That's year one.

We don't know how to do the harvest this year and how to export it. In addition to that, half of the winter wheat is in occupied territories. That's the second one.

The third harvest in August is when we put in winter wheat for the following year. Here's what we see. The farmers will have to decrease the amount of winter wheat they sow, or they will plant more rapeseed, as there's more of a market for this. There are fewer tonnes per hectare, and it's easier to transport.

It would not be surprising that, if we see no improvement with the ports, wheat in Arabic countries will cost $600 or $700 per tonne, and this would lead to large problems. That is a very high price for wheat. These countries have no budget for wheat. Egypt and other countries are still removed from the war. They're hoping that, in two or three months, the situation will change. Maybe there will be some sort of agreement and they can survive on existing stocks, but, unfortunately, that will not happen. Their hopes, I'm afraid, will be dashed.

In July and August we will see emotions in Arabic, Asian and African countries reaching their peak, because the offer of grain, of wheat, will be very low, and the USDA will have to correct it.

[The Chair, Liberal, Kody Blois]

Thank you, Mr. Lehoux and Mr. Minister.

Ms. Taylor Roy, you now have the floor for five minutes.

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

Thank you very much, Mr. Chair.

Thank you, Minister Solskyi, for being here with us. I know you're terribly busy, and I appreciate your taking the time at this late hour. What I would like to do, although I have several specific questions, is to ask you, because you're here, and we can better—

[Mykola Solskyi]

I'm sorry; can I ask for a translator?

[The Chair, Liberal, Kody Blois]

I'm just going to stop the clock, Ms. Taylor Roy. We will make sure we have that sorted away. I will look to the clerk.

[Mykola Solskyi]

[Witness spoke in Ukrainian]

Please continue.

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

Is it working now, Kody?

[The Chair, Liberal, Kody Blois]

It is. We're back, Ms. Taylor Roy, so over to you.

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

Thank you.

Like all of my colleagues here have said, we are standing in complete solidarity with you.

What I would like to do is give you an opportunity, because we are here to listen to you so that we know better how to support Ukraine in the agricultural sector and your farm workers on our own and in concert with your other allies. I want to give you the opportunity to say to us things you think are important for us to hear on how we can help and what the most pressing issues are that we can help with.

[Mykola Solskyi]

[Witness spoke in Ukrainian, interpreted as follows:]

Thank you.

Maybe it's not very specific, but the most efficient resolution of the situation in the agriculture sector of Ukraine is to bring this war to an end. We see that Russia doesn't want to do that and we are forced, and we are ready, to fight to the finish this war.

In order for Ukrainian farmers to continue their work so that the ships can come into ports, and to stabilize food prices, we need stability. We need to be able to know the future, and it's not possible to have this forecasting without bringing the war to an end.

That's why I am not talking about tractors. I am appealing to you to do everything possible to help us bring this war to an end.

In regard to the agricultural sector, it is a matter, of course, of storage facilities. We see how critical it is and it will be. We know that Canada is one of the leaders in the agricultural sector and in agricultural technologies. Actually, part of the agricultural sector in Ukraine is very similar to the agricultural sectors in the U.S.A. and Canada. We have similar agricultural cultures that we grow, so in that sense we are close and the size of the farms, the technologies that are being used, are similar and Ukrainian farmers have experience using these technologies.

In terms of storage of grain, this is something that we need, especially now that we cannot export the grain, so after armaments, that would be the next most important thing.

[The Chair, Liberal, Kody Blois]

Ms. Taylor Roy, you're on mute and we have about 45 seconds, maybe a little over a minute.

Maybe we could have a very quick question and a quick response from the minister just so we can try to stay on time.

Thank you.

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

Thank you.

Thank you for that, and we understand that the most important thing is ending the war and securing the future of Ukraine, for Ukraine and for all of us.

You mentioned displaced persons as well and the need to try to help them to find employment. Could you just elaborate a little bit on that?

[Mykola Solskyi]

[Witness spoke in Ukrainian, interpreted as follows:]

Yes, of course.

What we see in our agricultural sector in Ukraine, if we look at the number of people employed in agriculture and compare it with the area of agricultural land, we have very few people. There are not enough people working in agriculture, mainly because they are growing corn, rapeseed for oil, and sunflowers.

After the disintegration of the former Soviet Union, there was an approach to grow what were the easiest cultures to grow, so certain areas in agriculture are underdeveloped currently. I think this is what we can focus on and we can employ many more people. It's been developing, but at a very slow pace, so we would like to see it intensified because I think many people would like to be involved in that. There is a lot of agricultural land to be involved in this type of agricultural production and it's one of the fastest and least expensive ways to create new jobs if we compare it with other types of agricultural production.

Of course, we also need new agricultural technology. Canada is a leader in some areas, for example, in fruit orchards and how to grow and expand them. We have agricultural lands that are similar to ones in Canada so we could hopefully use your experience. We are actually already purchasing a number of intake materials from Canada, so we think we will be forwarding to the Canadian government our ideas and propositions of what kind of help from Canada we could receive in order for us to employ more people in Ukraine in the agricultural sector.

This way we're hoping to decrease the number of displaced people who are travelling abroad from Ukraine.

[The Chair, Liberal, Kody Blois]

Thank you very much, Minister.

Thank you, Ms. Taylor Roy.

Now, we are going to move to the Bloc Québécois and the NDP portion. These are shorter portions of two and a half minutes, so I would request, Mr. Perron and Mr. MacGregor, a relatively short question. I'll try to hold it to two and a half minutes. We've been a bit flexible, but please.

Over to you.

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

Mr. Minister, I'd like to go back to export capabilities.

According to what you said earlier, you will be able to export 30 million tonnes of your 60 million tonnes, but you're concerned about a grain shortage in the countries that usually receive your grain. Could you elaborate on that?

Do you fear that food supply issues are to come in the various zones of Ukraine or in the occupied zones of Ukraine, or are you not very concerned about this since you are an exporter?

[Mykola Solskyi]

[Witness spoke in Ukrainian, interpreted as follows:]

If you're talking about basic food supplies, they're fine. They have enough grains stored from last year's harvest, when this territory was still ours and not under occupation.

It was sown last year, so they will be able to harvest it this year. They also have enough basic supplies. Obviously, the Russians will also try to introduce some commerce and trade because they are the occupying power and they will be trying to win favour from the local population. It's an obvious truth.

It is difficult for them to do that. It's not going easy for them because they were hoping that they would be well received by the local populations, but what they are faced with is that everyone is very much against the occupation. We can forecast that it will be a difficult situation, but we do not foresee hunger or famine. We do not foresee any of that.

There will be some food shortages of certain fruits, for example, and some vegetables, but it will not be critical if we are talking about a limited time frame.

[The Chair, Liberal, Kody Blois]

Thank you very much, Mr. Minister and Mr. Perron.

Mr. MacGregor, if we could keep it tight, I'd appreciate it.

Thank you.

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

Thank you, Chair.

Minister, very quickly, we know Ukraine is a bread basket for the region and for many countries in Africa and Asia. You said that emotions will run high soon because of the food prices and the lack of exports coming from Ukraine.

Do you have a sense of the damage that is being done to Russia's reputation in that region? Russia has spent decades trying to build a relationship with many of those countries. Is there an understanding now among those countries of the damage that Russia is causing to their future stability and security, especially when they are looking at rising food prices and shortages?

[Mykola Solskyi]

[Witness spoke in Ukrainian, interpreted as follows:]

I can only tell you my personal opinion. It's obvious that every country now, every person in the world, even if they live very far from our region, is paying for this war because they have to pay more for food products. I think that, lately, African countries and all countries in other regions of the world are beginning to understand. Even in Egypt, their tourism, which is historically.... They've always had kind of careful relations with Russia because of the tourism implications, but even that will not prevent them from seeing that now they're paying too high of a price for not speaking out against the war.

What we have seen in the last few weeks is that Russia is beginning to understand this also. That's why we can see that there was a leader from the African Union visiting Russia recently and holding talks. There were statements by Putin that Russia is not against exports of grains from Ukraine, is not preventing anything.

I think he is laying the groundwork for future statements where they will be saying that they are not responsible for the crisis, but that it's Ukrainians together with their western partners who are not able to either organize the exports or don't want to organize exports of grains. I think this is what they are doing. They are laying the groundwork, a foundation for future accusations against Ukraine. Officially, he was making statements that we're not preventing any exports—"Please, go ahead and export"—but how can it be done if you submarines and naval ships there, where there is fighting every day?

[The Chair, Liberal, Kody Blois]

Thank you, Minister. I apologize, I don't mean to cut you short, but we want to get to one final round of questions. It would normally be five minutes, but we don't have that time.

Mr. Epp, I'm going to ask you to ask one tight question, then I'm going to go to Mr. Louis for one tight question, and then unfortunately we're at our time.

Mr. Epp, please, go ahead.

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

Thank you, Minister, for joining us in such difficult times.

I've shared with this group before that this is personal for me as my four grandparents were born in southern Ukraine. Canada and Ukraine are breadbaskets, but my own heritage and where I visited three times has been in the southern part—Zaporizhzhia, Kherson, Melitopol and those regions. It's a vegetable and fruit area, and you've touched on that. Can you tell us about the impact of this on vegetable production for your own people, for Ukraine, and I know some was also exported and manufactured. I know the Chumak company for its ketchup.

Can you tell us more about the situation regarding fruits and vegetables?

[Mykola Solskyi]

[Witness spoke in Ukrainian, interpreted as follows:]

Yes. I can see that you know this particular area of Ukraine, and yes, agricultural production is very widespread there. This area is under occupation now, and because of that, we feel the lack of early vegetables and fruits. We can see that farmers in that region of Ukraine, this season and next season, don't want to deal with vegetables and fruits because this requires bigger investments as opposed to investments in soy or corn, so, temporarily, I think they will not be concentrating on the fruits and vegetables.

Second, these areas require irrigation, watering, and they have special water channels from the Dnieper River. From what we understand, part of these water channels, waterways, are used by Russians as defence lines, defence structures, so it is very difficult and of course hampers agricultural work. There is occupation, not enough water and constant war.