Agriculture Committee on Sept. 28th, 2022

[The Chair, Liberal, Kody Blois]

I call this meeting to order.

Welcome to meeting number 28 of the House of Commons Standing Committee on Agriculture and Agri-Food. I'm going to start with a few reminders.

Today's meeting is taking place in a hybrid format. The proceedings will be made available via the House of Commons website. Just so you are aware, the webcast will always show the person speaking, as opposed to the entirety of the committee. Screenshots are not permitted, and, of course, following the health guidelines according to the Board of Internal Economy is required.

Pursuant to Standing Order 108(2) and the motion adopted by the committee on Monday, May 30, 2022, the committee is resuming its study of global food insecurity. This is something that we've been studying since June, and we're turning to a domestic focus.

I'd like to welcome the witnesses to our panel right now. We have three different witnesses in the room.

I see Mr. Perron's hand, and I want to let him know that there were sound checks done ahead of time for interpretation services. Mr. Lemaire failed his technical test, but all of the other witnesses passed. He had to travel at the last minute and forgot the headset that was issued by the House of Commons. He is in the second panel. If the interpretation services are not adequate and the earbuds he has do not work, he unfortunately will not be able to participate. Everyone else did go through that service.

I want to start with the panellists who are here.

On the screen, we have Dr. Evan Fraser, who is the director of Arrell Food Institute at the University of Guelph. He is joining us by video conference.

From Cereals Canada, we have Mark Walker, vice-president of markets and trades. Mr. Walker joins us today in person in Ottawa. It's great to see you, Mr. Walker.

We also have, from the Global Institute for Food Security, Dr. Steve Webb, who is the chief executive officer. He is here via video conference from Saskatoon. Dr. Webb, it's great to see you. I had the opportunity to join you in April in Saskatoon, and I certainly appreciate the work that you do.

We're going to give five minutes for opening statements. We are a little time-constrained today because of the votes, so we're going to move as quickly as possible.

I'm going to start with Dr. Evan Fraser.

You have up to five minutes.

[Dr. Evan Fraser, Director, Arrell Food Institute, University of Guelph, As an Individual]

Thank you. What a great opportunity.

In these brief comments, I'd like to lay out four points for you to ensure that Canada uses advanced agri-food technologies to both expand exports, which was the question I was asked to ponder, and at the same time be a global leader in what we're calling the “digital agriculture revolution”, which is a way of addressing climate change. We're looking for some win-wins here.

First is the obvious: We have to invest in our infrastructure more. Today, as we know, the Prairies are almost a unique resource globally in terms of their ability to produce grains and oilseeds as well as plants and animal-based proteins. That capacity goes through the Rocky Mountains on a very small number of train lines, and every few years that service is disrupted.

Just last week, I was on a panel with the vice-president of operations for the Port of Vancouver, and he discussed how the bottlenecks are spreading even now as we speak. The fragility of our trading system harms our ability to be that breadbasket for the world that Canada aspires to be, and we need to make our transportation infrastructure more of a focus.

The second point is to create financial incentives to reward farmers who adopt greenhouse gas mitigating management practices and then market ourselves to world markets as sustainable agriculture. By embracing what some of us are calling regenerative agriculture, meaning encouraging farmers to use more complicated crop rotations that take greenhouse gases out of the atmosphere, and by using smart tractors that are very, very efficient with fertilizer, agriculture can become a source of the climate solution as opposed to a source of greenhouse gas emissions. Doing that will allow us to build a global sustainability brand that will be a trade advantage in an increasingly climate-concerned world.

Without giving too much away, on October 25, my institute, the Arrell Food Institute, together with the CEO's office at Royal Bank and the Boston Consulting Group, is releasing the first of a series of reports that tackle that issue. The punchline of these reports is that we need a federal carbon pricing mechanism that captures agriculture, sends the signals to farmers to do the right thing and gives us a basis on which to build a sustainable trade brand.

Third, if we want to produce the food, we have to train the right people, and this requires us to address the labour shortage. This means we have to train people, encourage young people to come into agriculture and rebrand agriculture away from the idea that it involves a straw hat and a red barn and towards the understanding that the farmer of the future is as likely to wear a lab coat as she or he is to drive a tractor. Agriculture is part of the innovation economy, and we need investment in our curriculum of skills that we train people with. If Canada wants to expand our exports in the long term, we need a technologically savvy workforce who are ready to drive innovation.

Fourth, and finally, my last point is that we need to invest in the tools of what some of us call the “digital agriculture revolution”. The same tools that gave us smart phones and are transforming medicine are finding their way into barns and food processing facilities as controlled environment agriculture, vertical farming, and robotic harvesters and milkers, allowing us to boost production while reducing inputs, along with more efficient processing facilities and smart packaging. That's just a tip of the iceberg of what technology can unlock for us.

I think Canada needs to be at the head of this wave of innovation. We should do this by creating ag-tech innovation zones, giving particular areas preferential tax and immigration status, land-use planning permissions and competitive utility rates, thus germinating a Canadian Silicone Valley for food.

There's a lot of good stuff already going on in the world and in our country. A quick example of a public-private partnership that is run by the Weston Family Foundation is a homegrown innovation challenge designed to spark innovative thinking on these technologies in our country.

To close, there are four points: expanding our transportation infrastructure, creating carbon markets and a global sustainability brand, training the next generation to be technologically savvy users of this digital agriculture revolution and creating ag-tech innovation zones.

These four strategies would allow us to grow exports in the long term and also allow us to reach that vision that the advisory council for economic growth, the Barton report, gave us in 2016, which is that Canada should be the world's trusted supplier of safe and sustainable food in the 21st century.

With that, I'd like to thank you and open the floor for questions, or whatever you want, Mr. Chair.

[The Chair, Liberal, Kody Blois]

Thank you, Mr. Fraser.

You're actually below time, and that was very well done.

We're now going to turn to Mr. Walker. You have up to five minutes.

We will get the chance for questions after we're done with all our panels.

[Mark Walker, Vice-President, Markets and Trade, Cereals Canada]

Thank you, Mr. Chair and members of the committee. Thank you for having me here today.

My name is Mark Walker, and I'm the vice-president of markets and trade at Cereals Canada.

Cereals Canada is a national industry association for wheat, durum, barley and oats in Canada. Our membership includes a full value chain, from farmers to crop development companies to grain handlers and exporters.

Our members are focused on the benefits of export-led growth, facilitated by access to diverse global markets. Canadian cereals are a staple food export to every corner of the world. In the last half decade, Canadian wheat exports have reached over 80 countries. In an average year, Canadian farmers plant 35 million acres of cereals, resulting in 27 million tonnes of exports and over $9 billion in export revenue.

For generations, Canadian farmers have grown crops that feed the world. While global populations have grown, the demand for food has grown with them. Canada's cereal growers have risen to this challenge by embracing innovative practices while increasing our country's ability to produce for ourselves and for export. Improved seed varieties have led to greater yields across our industry, and new crop production technologies have allowed producers to grow their crops more efficiently while reducing their environmental footprint.

In the 1980s, wheat yields averaged 27 bushels per acre across 27 million seeded acres. While seeded acres of wheat have fallen to 15 million, our yields have increased to over 50 bushels per acre. The precision and success with which growers farm today is a testament to decades of enabling regulations, investment in research and a willingness to innovate. Government's role in this progress has been notable and is greatly appreciated.

As our industry undertakes to manage growing seasons increasingly characterized by drought, excess moisture and a volatile climate, all while seeking to ensure consistent production for export, we would highlight the continued role that government has to play in this space.

We believe export success begins at home, with Canadian production of sustainable food. Farmers need access to science-based regulations to support the productivity, reliability and quality of Canadian exports. A trade environment that facilitates the production and export of Canadian agriculture products is key to strengthening Canada's contribution to global food security in the coming years.

Outside of our borders, industry and government can also work together on market development and market access initiatives to cultivate opportunities for growth and diversification across more than 80 markets that purchase Canadian cereals.

Cereals Canada houses a dedicated team of experts focused on market maintenance, market development, market access and trade policy. Our team of experts tirelessly represents the Canadian cereals industry across the world to our international customers and international domestic governments to ensure that Canadian cereals make their way to global markets in the most efficient way possible. Where barriers arise, we proactively seek solutions.

Agriculture and Agri-Food Canada's AgriMarketing program, which we have successfully subscribed to for over a decade, plays a key role in this work. As we diversify our international markets for wheat, barley and oats, we will continue to look to this incredibly important program to build on our successes and advance global food security.

In addition to our markets and trade team, Cereals Canada's technical team of experts works with international customers to ensure that they get the most and best use from Canadian cereals. Canadian wheat is used as an “improver” wheat around the world. Blending Canadian wheat with lower-protein, lower-quality alternatives improves the function and use when making food products for customers. In an environment of rising food costs and supply disruptions, our experts are working with international customers on how to use Canadian wheat to its maximum value.

Using our equipment and expertise, our teams work with customers to streamline various processes within their production systems. For example, through our understanding of the requirements of various customers, our pilot mill in downtown Winnipeg has helped reduce the number of milling cycles required to produce the flour for our customers' end-use products, saving resources and increasing affordability.

Earlier this month, members of the same team provided a workshop at the African Milling School in Kenya to help train millers from across Africa on best practices when using Canadian wheat. Last week, we hosted a group of North African durum millers for conversations about this year's harvest to outline quality expectations for use in their mills. Several years ago, we undertook a significant knowledge transfer exercise, helping to open a technical facility in Morocco focused on durum wheat, milling and couscous production.

Increasingly, our conversations with global customers highlight concerns regarding the tightening supplies of wheat and the role that our organization can play in meeting those challenges. Ultimately, a stronger trade environment, supported by enabling domestic policies, will enhance contributions to global food security while unlocking greater diversification opportunities for the development of the Canadian economy.

Thank you. I look forward to your questions.

[The Chair, Liberal, Kody Blois]

That's two for two.

Thank you very much, Mr. Walker. We're right on time.

Dr. Webb, we'll go over to you for up to five minutes.

[Dr. Steve Webb, Chief Executive Officer, Global Institute for Food Security]

Thank you and good afternoon, Mr. Chair. Thanks for the invitation to be here today.

The Global Institute for Food Security is a government, industry and academic partnership.

I'd like to begin my testimony with a critically important statement: Global food insecurity is global insecurity.

Norman Borlaug noted that you can't build a peaceful world on empty stomachs and human misery. Mr. Chair, at no time has this statement been more poignant than it is now.

Global population is expanding rapidly. We have the challenge of feeding a growing world with limited resources of land, water and nutrients, as well as challenges both natural and entirely self-inflicted, such as Russia's invasion of Ukraine. These all threaten the resiliency of the global food system and our ability to feed the world sustainably.

However, there's a solution to these challenges. In Canada, we are one of a handful of nations that are net producers of food, and we do so in a manner that's economically, environmentally and socially sustainable. We have the food, fuel and fertilizer that the world needs, and our agriculture and food sector is poised to feed a growing world. However, to succeed we need to support the industry with appropriate policies that enable us to take advantage of the opportunities before us.

The previous two witnesses mentioned the Barton report, and they identified the opportunity here. The report's right, so today I'd like to recommend four domestic policy opportunities that can improve Canada's exports on the global stage.

The first is around innovation. We cannot continue to tackle today's and tomorrow's challenges with yesterday's tools and technologies. We need innovation to help deliver the greatest positive impact through our agriculture and food sectors. Unfortunately, Canada's innovation input does not produce the returns on investments that we should expect.

The most recent Conference Board of Canada report ranks our nation as eighth in investments but 23rd in outcomes achieved. We need to remedy this situation by creating a coherent, integrated, national innovation strategy. Innovation is a team sport, and we can no longer focus on revamping one part of the system without consideration of all areas involved.

The next policy recommendation is to drive major capital investments into infrastructure. We can't recommend a policy to improve Canadian exports without addressing the infrastructure to support this, such as rural wireless connectivity, ports and rail systems. Investments in our infrastructure will ensure that Canada remains competitive and regains its reputation as a reliable supplier. Canada must own this.

The third policy recommendation is around regulatory modernization through the creation of a transparent, predictable, science-based, interactive and enabling regulatory framework. Our agriculture and food sectors are impacted by regulatory complexity and bottlenecks that limit producer and consumer access to the latest proven innovations. A highly functional regulatory framework is a competitive advantage for Canada. It builds trust, both here domestically as well as internationally. We know this can be done, but it shouldn't take a crisis for things to work. Let's lay the building blocks now for modernizing our regulatory system to embrace a science-based approach that supports innovation.

The last policy recommendation I'd like to highlight relates to sustainability. Canada is one of the world's most sustainable producers of food. We need to be proud of the strides we have made and how far we've come.

On changes in agronomic practices, Dr. Fraser mentioned regenerative agriculture, such as no-till practices. Variable rate fertilizer application in western Canada, and in particular in Saskatchewan, has resulted in 22% more land being used in annual production, with the elimination of summer fallow. Remarkably, on a production intensity basis, farmers in western Canada have decreased nitrogen fertilizer use by 28% per bushel per acre over the last 30 years.

When we consider policy changes such as recent discussions to reduce fertilizer emissions, and by extension usage, we must consider the unintended consequences of such policies. Not doing so will paint an inaccurate picture of how sustainable Canadian agriculture is and will lead to public mistrust of our resilient and sustainable agriculture system. This will in turn negatively impact export opportunities. We need to lead the way on this. Canada should not be following.

One last point I'd like to leave with the committee is that we need to bring all parties to the table together to address these challenges. GIFS model of industry, government and academia partnership embraces the best of all three of the stakeholders needed to advance innovation. We need to capture the wisdom of the room with all of the stakeholders.

As I wrap up, I'd like to thank you, Mr. Chair, and members of the House committee, for the invitation and the opportunity to share my thoughts with you today. I look forward to questions.

Thank you.

[The Chair, Liberal, Kody Blois]

That's three for three. Well done to our witnesses for timing.

[Dr. Steve Webb, Chief Executive Officer, Global Institute for Food Security]

Colleagues, because there was some delay with the votes, we have about 45 minutes per panel. The way I'm going to do this is that each party will get a first six-minute round and then we will allow two and a half minutes for the Liberals and the Conservatives each on the second round.

Mr. Barlow, you're going to lead off for the Conservatives.

[John Barlow, Foothills, CPC]

Thank you very much, Mr. Chair.

Thanks to our witnesses. I appreciate your patience as we sort of get back to normal with votes. Unfortunately, that does delay committees sometimes.

For Dr. Webb first, I appreciate your comments about the need for science-based decision-making and a science-based regulatory regime. In your opinion, would the fertilizer emissions reduction policy be a decision or a policy that's based on sound science? If not, why?

[Dr. Steven Webb]

I would like to say that the intention of the policy is right, in the context of reducing emissions. However, the approach is only being looked at in the context of the emissions standard.

We need to take that holistic production intensity approach to ensure that we have a policy framework that delivers economic, environmental and social outcomes that lead to sustainability. Again, if you look at the results that I've mentioned—the 22% increase in land in production as well as the 28% reduction in nitrogen use per bushel per acre—these are data points that can inform policy to ensure that we have the one that creates the most competitive environment for Canada in the global marketplace.

[John Barlow]

To that point, I appreciate that you mentioned that our producers have already reduced fertilizer use by 28% in many parts of the country.

You talked about the narrative around this. If reducing emissions is indeed our goal, which is very laudable, would it not have been more beneficial in the narrative, and certainly to our producers, to say to other countries around the world that if they need to reduce emissions, why not take a look at what Canada is doing? We are the gold standard. We have already reduced fertilizer, so take a look at our innovation and our technology and learn from our practices here in Canada. Would following our standard not have been a more successful approach to reducing emissions in other countries?

[Dr. Steven Webb]

That is the opportunity for Canada to lead the way and to provide and share those innovations.

Today all of the witnesses who are appearing in front of this committee are members of the National Index on Agri-Food Performance. That index is a coalition of over 100 organizations, which includes federal government departments as well as provincial departments, industry players large and small, and all of the producer groups. Evan and I are part of the index from the not-for-profit community. It's a very interesting Canadian solution to benchmarking economic, environmental, social and food integrity opportunities to showcase and highlight them and have Canada lead the way.

We should not be following. We should not be ashamed of the impact that innovation has made in agriculture.

The first time I came to western Canada, I was 14 years old. Almost half the land that I saw was under summer fallow. Now it's not, so thank you.

[John Barlow]

Thanks, Dr. Webb.

I want to turn to Mr. Walker now.

I know you talked about transportation. Eight union contracts with railways expire on December 31. Everything I've heard is that we could have our yields up about 50% compared to last year, which was admittedly a difficult year.

What impact has rail capacity had on our ability to meet some of our goals in terms of trade opportunities and moving goods? Is the industry potentially looking at what could be happening later on this year?

[Mark Walker]

Thank you for your question.

You made some good points about harvest and yields. At the end of the day, Canadian exporters need trade infrastructure that keeps up with capacity to meet growing export demand. We know that for cereals, this year's harvest is going to be 56% larger than last year. Harvest was 80% complete across Canada as of last week. With this in mind, our export sector is certainly eager to work with the railways to ensure that Canadian grain gets to market in a timely and efficient manner.

[John Barlow]

Are there some specific steps that the industry has looked at in terms of rail service? Is there federal policy that we can use to ensure food security not only domestically but to meet demand globally as well?

[Mark Walker]

I'm a markets and trade expert. I do some work on transportation policy, but Cereals Canada is a member of the Canada's Ready coalition. We have a landing page, canadasready.ca, that outlines our asks of government, as well as the railways, moving forward into this critical harvest. I will provide that information to the committee so that it can be included as part of the study.

[John Barlow]

I have time for one last quick question. It's for Dr. Webb as well.

You've talked about infrastructure, ports and rail. Is there something specific on the rail side when we see that these union agreements could be expiring on December 31? What would you like to see there from a federal policy to ensure that rail keeps moving?

[Dr. Steve Webb]

When even the threat of strikes comes up, we've seen that it creates uncertainty in the supply chain. Any way to mitigate labour disruptions would be beneficial to all in the system.

[The Chair, Liberal, Kody Blois]

Thank you, Dr. Webb. Thank you, Mr. Barlow.

[Dr. Steve Webb, Chief Executive Officer, Global Institute for Food Security]

We're going to turn to Mr. Drouin for six minutes.

[Francis Drouin, Glengarry—Prescott—Russell, Lib.]

Great. Thanks very much to the witnesses for being here.

I have a quick question on transportation. Maybe Mr. Walker could comment. I would also like to get Dr. Fraser's opinion, because he's mentioned that transportation is important.

Recently I found out that the delta for a train to be on time is about four hours. If you're four hours before, you're on time. If you're four hours after the time you've set, both companies that are operating in Canada say you're on time. Are they actively trying to work with your members to reduce that delta so that they're on time? How does that compare to the U.S., for instance?

We know there might be strike potential in the U.S. as well. We often hear about CN and CP, but I don't know what's happening in the U.S. If you're talking to some of your counterparts in the U.S., what's the relationship down there with the rail companies?

[Mark Walker]

Rail times are down across the network, by weeks, is my understanding. We have half the capacity we did this year compared to last year. Beyond those statistics, I can't speak to specifics, but certainly I can look to provide that information to the committee.

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

Okay.

Dr. Fraser, I think you mentioned the VP for the Vancouver port authority. What was he or she saying—I don't know who she or he is—in terms of trying to expand the network so that we can get grains out to the marketplace more quickly and on time?

[Dr. Evan Fraser]

Well, he was making a couple of key points last week. It was an event organized between the Canadian embassy in Japan and the Japanese embassy in Canada and the mutual chambers of commerce to discuss better connections between Canada and Japan on agricultural exports.

There were two main points. One was the extraordinary logistical challenges the port authority was having in terms of just physically bringing that volume of stuff into the area and in an environment of extraordinarily constrained labour conditions, and then getting it onto the ships and getting the ships out. He was laying out a series of innovations using technology they had embarked on that was going to try to relieve that bottleneck, but then he made the very obvious point that as you move back up east out of Vancouver and into the Rocky Mountains, you end up with these tiny umbilical links between the Prairies and world markets. The absurdity just struck me—well, not the absurdity, but the fragility of that image of Alberta, Saskatchewan and Manitoba and how all of the food production in this enormous area the size of Europe is going through essentially a small number of rail lines and through a couple of passes. It's just the inherent fragility of the system that we've inherited and that we've allowed to continue. There has to be a way of reducing the bottlenecks that emerge in that system, because, as we just heard, the system buckles. Every couple of years it buckles.

Certainly the article in the Financial Post last week by Jake Edmiston suggests we're into another situation this year of not being able to be that breadbasket that our country should be.

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

Yes, and nobody is expecting us to move mountains, if I can—